Expedia 2014 Annual Report Download - page 41

plaintiff’s common law claims for the recovery of taxes. On October 14, 2014, the court denied the online travel
companies’ motion to dismiss. The case is currently scheduled for trial to begin on September 21, 2015.
Arizona Cities Litigation. Business activity privilege tax assessments were issued in 2013 by 12 Arizona
cities (Apache Junction, Chandler, Flagstaff, Glendale, Mesa, Nogales, Peoria, Phoenix, Prescott, Scottsdale,
Tempe and Tucson) against a number of online travel companies including Expedia, Hotels.com and Hotwire.
The online travel companies petitioned for redetermination of the assessments. On May 28, 2014, the Municipal
Tax Hearing Officer granted the online travel companies’ protests to the assessments and ordered the cities to
abate the assessments. On August 26, 2014, the cities appealed the Hearing Officer’s decision by filing
complaints and notices of appeal against the online travel companies in Arizona Tax Court. (See City of Phoenix,
et al. v. Expedia, Inc., (Case No. TX2014-00471)).
Notices of Audit or Tax Assessments
At various times, the Company has also received notices of audit, or tax assessments from municipalities
and other taxing jurisdictions concerning our possible obligations with respect to state and local hotel occupancy
or related taxes. The states of Arkansas, Colorado, Hawaii, Kentucky, Maine, Maryland, Minnesota, Montana,
New York, South Carolina, Texas and West Virginia; the cities of Phoenix, Scottsdale, Tucson, Peoria, Apache
Junction, Avondale, Chandler, Glendale, Flagstaff, Mesa, Nogales, Prescott and Tempe, Arizona; Jefferson
County, Arkansas; the city of North Little Rock, Arkansas; the cities of Los Angeles, San Diego, San Francisco,
West Hollywood, South Lake Tahoe, Palm Springs, Monterey, Sacramento, Long Beach, Napa, Newport Beach,
Oakland, Irvine, Fresno, La Quinta, Dana Point, Laguna Beach, Riverside, Eureka, La Palma, Twenty-nine
Palms, Laguna Hills, Garden Grove, Corte Madera, Santa Rosa, Manhattan Beach, Huntington Beach, Ojai,
Orange, Sacramento, Sunnyvale, Truckee, Walnut Creek, Bakersfield, Carlsbad, Carson, Cypress, San Bruno,
Lompoc, Mammoth Lakes, Palm Springs, San Jose, Santa Barbara, Bishop, Buena Park, Milpitas, Palmdale,
Santa Rosa, and Pasadena, California; the county of Monterey, California; Greenwood Village, Broomfield,
Durango, Frisco, Glendale, Glenwood Springs, Golden, Greeley, Lafayette, Littleton, Longmont, Loveland,
Silverthorne, Breckenridge, and Denver Colorado; the counties of Miami-Dade and Broward, Florida; the city of
Chicago, Illinois; Lake County, Indiana; the cities of New Orleans and Lafayette Parish, Louisiana; Santa Fe,
New Mexico; New York City, New York; Multnomah County and Portland, Oregon; and Arlington, Texas,
among others, have begun or attempted to pursue formal or informal audits or administrative procedures, or
stated that they may assert claims against us relating to allegedly unpaid state or local hotel occupancy or related
taxes.
Actions Filed by Expedia
Broward County, Florida Litigation. On January 12, 2009, Expedia, Hotels.com, and Hotwire filed separate
actions against Broward County, Florida and the Florida Department of Revenue. Expedia, Inc. et al. v. Broward
County Florida, et. al., Case Nos., 37 2009 CA 000131, 37 2009 CA 000129, and 37 2009 000128 (Second
Judicial Circuit Court, State of Florida, Leon County). The complaints contest the assessments against plaintiffs
on the grounds that plaintiffs are not subject to the tourist development tax, among other claims. On May 13,
2009, the court consolidated all cases brought by the online travel companies for all purposes except trial on any
of Broward County’s counterclaims. On July 13, 2012, the court granted the online travel companies’ motion for
partial summary judgment and motion for summary judgment as to Broward County’s counterclaims and held
that the online travel companies have no obligation to collect and remit hotel occupancy taxes. The court denied
Broward County’s cross motion for summary judgment. Broward County filed a notice of appeal of the trial
court’s decision. On February 12, 2014, the Florida Court of Appeals affirmed the trial court decision in favor of
the online travel companies. This case has been stayed pending the Florida Supreme Court’s decision in the Leon
County, Florida et. al. Litigation.
Indiana State Sales Tax and County Innkeeper Tax Assessments. On March 2, 2009, Travelscape, LLC,
Hotels.com and Hotwire filed petitions in Indiana Tax Court appealing the final determination of the Indiana
State Department of Revenue and seeking to enjoin the collection of the tax. Travelscape, LLC v. Indiana State
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