Expedia 2015 Annual Report Download - page 36

Part I. Item 2. Properties
We lease approximately 2.9 million square feet of office space worldwide, pursuant to leases with
expiration dates through December 2026.
We lease approximately 510,000 square feet for our headquarters in Bellevue, Washington, pursuant to
leases with expiration dates through October 2018.We also lease approximately 890,000 square feet of office
space for our domestic operations in various other cities and locations pursuant to leases with expiration dates
through December 2022.
We also lease approximately 1.5 million square feet of office space for our international operations in
various cities and locations pursuant to leases with expiration dates through December 2026.
In addition to our leased space, on April 30, 2015, we acquired our future corporate headquarters for $229
million, consisting of multiple office and lab buildings located in Seattle, Washington. The build out of the
headquarters is expected to be significant as we convert lab facilities into office space. We expect employees to
be moved to the new location during 2019.
Part I. Item 3. Legal Proceedings
In the ordinary course of business, Expedia and its subsidiaries are parties to legal proceedings and claims
involving property, personal injury, contract, alleged infringement of third-party intellectual property rights and
other claims. The amounts that may be recovered in such matters may be subject to insurance coverage.
Rules of the SEC require the description of material pending legal proceedings, other than ordinary, routine
litigation incident to the registrant’s business, and advise that proceedings ordinarily need not be described if
they primarily involve damages claims for amounts (exclusive of interest and costs) not individually exceeding
10% of the current assets of the registrant and its subsidiaries on a consolidated basis. In the judgment of
management, none of the pending litigation matters that the Company and its subsidiaries are defending,
including those described below, involves or is likely to involve amounts of that magnitude. The litigation
matters described below involve issues or claims that may be of particular interest to our stockholders, regardless
of whether any of these matters may be material to our financial position or results of operations based upon the
standard set forth in the SEC’s rules.
Litigation Relating to Occupancy and Other Taxes
A number of jurisdictions in the United States have filed lawsuits against online travel companies, including
Expedia companies, such as Hotels.com, Expedia, Hotwire, Orbitz and HomeAway, claiming that such travel
companies have failed to collect and/or pay taxes (e.g., occupancy taxes, excise taxes, sales taxes, etc.), as well as
related claims such as unjust enrichment, restitution, interest, and penalties. In addition, we may file complaints
contesting tax assessments made by states, counties and municipalities seeking to obligate online travel
companies, including certain Expedia companies, to collect and remit certain taxes, either retroactively or
prospectively, or both. Moreover, certain jurisdictions may require us to pay tax assessments prior to contesting
any such assessments. This requirement is commonly referred to as “pay-to-play.” Payment of these amounts is
not an admission that we believe we are subject to such taxes and, even when such payments are made, we
continue to defend our position vigorously.
Actions Filed by Individual States, Cities and Counties
City of Los Angeles Litigation. On December 30, 2004, the city of Los Angeles filed a purported class action
in California state court against a number of online travel companies, including certain Expedia companies. City
of Los Angeles, California, on Behalf of Itself and All Others Similarly Situated v. Hotels.com, L.P. et al.,
No. BC326693 (Superior Court, Los Angeles County). On April 18, 2013, the trial court held that the online
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