MGM Resorts Sued Over Resort Fees

Travelers United, a non-profit that claims to “represent all travelers,” has sued MGM Resorts over much-loathed resort fees.

On its Web site, Travelers United says this is “a price deception case,” claiming “this is a clear case of false advertising.”

Nobody loves resort fees, but from our experiences with MGM Resorts, the fees are transparent and readily available when booking a room.

So, good luck with this one, lawyers.

No resort fees rally

These showgirls were protesting resort fees. It seemed like a good idea at the time.

We rail against resort fees as much as anyone, but we’re fairly sure this practice isn’t going away because of lawsuits like this.

You can read the Complaint here (.pdf format). The case was filed in the District of Columbia. Still, Vegas-related.

The reasons for hotels charging resort fees are fairly complicated. Sorry, but we don’t have time to explain anything “complicated” because we are very busy and important. We also don’t entirely understand the reasons, but mostly the “busy and important” thing.

The obvious reason hotels charge this fee is to make more money. Yes, we went to public school.

Another reason is so hotels can be competitive on OTAs, or online travel sites. Customers often search for rooms based upon price. As resort fees aren’t included in the official price of a room, those lower priced rooms show up higher in search.

There’s also the motivation of recouping housekeeping and other costs for comped (free) rooms. Yes, hotels charge resort fees on “free” rooms.

In addition, hotels don’t have to pay occupancy tax for resort fees because, technically, it’s not a room charge.

Yeah, it’s all a little slimy.

Hotels say resort fees are for things like spa access and WiFi and, wait for it, local phone calls.

The real problem with resort fees is they’re perceived as a “hidden” fee. The reality is they’re not very hidden because everyone who has ever stayed at a hotel with resort fees knows about them. Which is pretty much everyone that’s ever stayed in a hotel.

Some people are really, really passionate about ending resort fees, like the folks at KillResortFees.com. There, you will learn a lot about this ridiculous practice.

While we appreciate the dislike of resort fees (sometimes called amenities fees or facilities fees), the rage about them has always been a little disproportionate to the level of irk.

In the case of Las Vegas, rooms are incredibly inexpensive compared to other destinations, even with resort fees attached.

If resort fees go away, hotels will just raise their room rates to make up for the lost revenue.

We say just add up the room rate and resort fee and be done with it. It’s the total cost that matters, not what label a charge is given.

Call resort fees something else if you need to. Call them “Frolicking Baby Panda Fees” if you prefer. Pandas are adorable. “It’s the fee that clings to your leg and you can’t shake it off!”

Call them “Happy Ending Fees.” Although, that’s an actual service in Las Vegas, so nevermind.

You know what we mean.

MGM Resorts parking fee

It’s really not about the amount of the fee, it’s how it makes you feel.

The Travelers United suit follows attorneys general in Nebraska and D.C. going after Hilton and Marriott last year.

The agency tasked with monitoring and presumably punishing hotels for deceptive practices, the FTC (Federal Trade Commission), has been fairly useless in resolving this ongoing burr under the collective saddle of travelers.

We’ll keep an eye on the Travelers United lawsuit, as it could bring more attention to the aggravating issue of resort fees.

There are still a few casino resorts in Las Vegas that don’t charge resort fees, but it’s a pretty short list. They include Four Queens, Binion’s and Casino Royale. Virgin Las Vegas announced it will not have resort fees when it opens March 25, 2021.

Until concerns about resort fees are addressed, feel free to direct your ire toward truly annoying things like paper straws, surge pricing and smaller pour sizes.

7 thoughts on “MGM Resorts Sued Over Resort Fees

  1. Boulder Steve

    Not sure about no taxes. They charge the same room tax on the resort fee. If they don”t pay tax yet charge it then thats fraud

    Reply
  2. Jackson

    This lawsuit won’t go anywhere simply because the fees are disclosed.

    The only lawsuit that might work is if a non-resort fee hotel sues hotels with resort fees (or a hotel group like Hilton, Marriott that allows the fees). The non-resort fee hotel could make the claim they are at a competitive disadvantage because search results don’t include the fees in the initial results.

    Of course even if the non-resort fee hotel wins, that doesn’t mean the end of the fees. Websites could simply add the fees to the search results, if they want.

    A more likely scenario would be if a city/county/state sued hotels over what Scott mentions: the fact that hotels aren’t paying the full tax rate on the resort fees. As such, these government entities are losing tax revenue.

    This type of lawsuit would have the same affect as the suits filed by the Attorney’s General of Nebraska and DC. Hotel websites would either need to be customized to comply to each lawsuit (unlikely) or all resort fees would disappear.

    In the end, however, I’m not sure it matters. If resort fees disappear, it’s not like the overall price of a hotel stay is going to drop. In fact, because the guest now has to pay the full tax rate, the price will go up by a couple of cents for every dollar.

    Reply
  3. project design

    Action Jackson….

    Your wrong…..resort fee’s are classical false advertising (example, what does it cost on hotels.com)….a lot more than advertised!

    Reply
    1. Jackson

      You’re wrong. I’ve worked in the hospitality industry for decades. As long as the fee is clearly shown in the pricing prior to the time you click the confirm button, it’s legal.

      But, hey. Clearly, you know more than all the high-price law firms that the various hotel groups have hired over the past few decades since resort fees were created.

      Reply
  4. Vice

    Resort fees are all about not paying commissions to third party booking sites. The third party booking sites pay the commissions for the room rate and not the resort fee. If resort fees are abolished, rates will probably rise to recover the new fully commissionable rates.

    Reply

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