Connecticut Attorney General Challenges Competitor Contacts

On April 1, 2010, the Connecticut Attorney General's Office announced an agreement with the La Quinta hotel group to cease contacts with competitors that the Connecticut Attorney General, Richard Blumenthal, characterized as "a wake-up call to the entire hotel industry -- signaling that call-arounds to set room prices are illegal and must be stopped." Under the settlement, La Quinta agreed to end "call-arounds," an alleged industry practice by which competing hotels in a particular geographic area exchanged current room rate and occupancy information, which the AG asserted could be used to fix prices.

The agreement with La Quinta characterized the practice of "call-arounds" as prevalent in the hotel industry and a potentially serious antitrust concern. The AG asserted that by sharing this rate and occupancy information, participating hotels were able to raise or stabilize the rates charged for their hotel rooms.