Texas Reaches Settlement With Booking Holdings in Junk Fee Case

Booking Holdings, which also owns Priceline.com and Kayak, was accused of engaging in “drip pricing,” a tactic where mandatory charges such as resort, amenity, destination, and utility fees were grouped under a single taxes and fees line item only at checkout. Paxton said this practice misled consumers by making advertised prices appear cheaper than they really were, creating what he described as a “bait and switch” advantage over competitors.

Per Reuters, the settlement requires Booking to change its pricing disclosures so that fees are presented to customers upfront. While the specific terms of the agreement were not immediately available, Paxton noted that the state had previously reached similar resolutions in 2023 with Choice Hotels, Hilton, and Marriott.

Related: Booking Slams EU Antitrust Decision as Speculative and Flawed

Booking, headquartered in Norwalk, Connecticut, denied any wrongdoing in the case. The company stated that it remains committed to transparency and emphasized that resort fees are generally set and retained by the hotels themselves. It added that its approach aligns with recent efforts by the Federal Trade Commission (FTC) to standardize how prices are displayed.

According to Reuters, the crackdown on so-called “junk fees” has been a policy focus in recent years. Former U.S. President Joe Biden had pushed for stronger oversight of fees that increase consumer costs without delivering clear benefits. In December, the FTC finalized its Junk Fees Rule, requiring hotels, ticketing platforms, and vacation rental operators to disclose total prices upfront.

However, the rule faced dissent within the agency. FTC Chairman Andrew Ferguson opposed the measure, arguing that with Biden leaving office, decisions on new regulations should be left to the incoming Trump administration.

Source: Reuters