MGM Resorts International is heading to court over its resort fees. Technically, MGM Resorts is being sued for violations of the Consumer Protection Procedures Act for misleading and deceptive advertising.
The lawsuit was filed by the non-profit consumer advocacy group Travelers United. The suit provides numerous examples of somewhat confusing marketing and advertising by MGM Resorts.
Resort fees aren’t exclusive to MGM Resorts hotel rooms. Most Las Vegas casino-hotel operators add this fee to the cost of hotel rooms. Oftentimes these fees are not included in advertisements of the pricing of rooms.
Various hotel operators add resort fees to hotel room prices as mandatory charges for services rendered by the hotel.
Misleading advertising from MGM?
The lawsuit points to a variety of misleading advertising surrounding resort fees. The advocacy group first asserts that MGM Resorts misleads all potential customers by noting that the company advertises “false overnight rates to consumers and then adding mandatory resort fees to the room rate at a later point in the booking process.”
A blog post also notes that MGM Resorts “lies to its best customers.” In this case, MGM Resorts’ best customers are M Life Rewards loyalty club members.
MGM Resorts sends offers to guests for complimentary hotel rooms. The marketing presents them as “free rooms” without clearly noting the associated resort fees. M Life Rewards members are charged a resort fee on complimentary rooms even though they’re promoted as a $0 room rate.
Travelers United also says that the resort fees are grouped with taxes in an effort to make the fee appear as though it’s a mandatory charge by the government.
MGM Resorts isn’t the only Las Vegas hotel company to use these tactics. The casino and hotel operator just happens to be the individual company in this lawsuit.
Frequent casino visitors understand that complimentary doesn’t mean free. There’s a cost involved with obtaining complimentary items from a casino operator. Typically, customers are rewarded with complimentary items in exchange for money spent at the property on gambling, food, drink, and spa services.
Not the first resort fee lawsuit
MGM Resorts isn’t the first hotel operator whose misleading advertising around resort fees ended up in a court case. The Attorneys General of the District of Columbia and the state of Nebraska have respectfully brought cases against the Marriott and Hilton hotel chains.
The suits haven’t been successful in the fact that resort fees still exist. However, more attention on the topic could bring legislation that could ban resort fees someday.
This lawsuit seeks to stop MGM Resorts from continuing what Travelers United calls misleading advertising. The advocacy organization is seeking to have MGM Resorts pay punitive damages.
Virgin Hotels Las Vegas will open without resort or parking fees
Most Las Vegas hotels charge resort fees. Some even tack parking fees onto a bill. When Virgin Hotels Las Vegas opens later this month the company won’t charge for either.
On top of these fees, the company won’t charge for wifi access. Anecdotally, prior to most Las Vegas casinos offering free wifi some business travelers would call the resort fee a “wifi fee” since they didn’t use the other offerings.
Virgin Hotels around the world have a brand-wide “No Nickel and Diming” policy. The advertised price is what guests will pay before taxes are added.
The hotel operator is also promising “street priced” minibars in the hotel rooms. Most hotels drastically mark up in-room prices for drinks and snacks. Virgin Hotels Las Vegas will offer these items at typical prices for guests.
The new property opens on March 25.
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