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Third_Amended_Class_Action_Complaint

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					           1   KALCHEIM LAW GROUP, P.c.
               Mitch Kalcheim (SBN: 175846)
           2   Amber S. Healy (SBN: 232730)
               2049 Century Park East, Suite 2150
           3   Los Angeles, California 90067
               Telephone: 310-461-1200
           4   Facsimile:   310-461-1201

           5   SHALOV, STONE, BONNER & Rocco LLP
               James P. Bonner, admitted pro hac vice
           6   Susan M. Davies, admittedpro hac vice
               485 Seventh Ave., Suite 1000
           7   New York, New York 10018
               Telephone: 212-239-4340
           8   Facsimile:    212-239-4310
               Attorneys for Plaintiff
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          12                SUPERIOR COURT OF THE STATE OF CALIFORNIA
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          14   NICOLE MONTGOMERY, Individually
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                                                         Case No. BC 335441
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          15   Situated,                                 THIRD AMENDED CLASS ACTION
'"                                                       COMPLAINT
          16                Plaintiff,
          17         vs.

          18   ORBITZ, LLC.; and Does 1-100,             Assigned to the Honorable Carl J. West
                                                         Department 311
          19                Defendant.
          20

          21
          22

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               THIRD AMENDED CLASS ACTION                     1.li\C1l\1cCIVII.UlJRARY\Ull1JrrL\l.ITJOATIOh"iilllJ111 ORllrrl. ~JUl AMENllEU
               COMPLAINT                                      CO~U'lAtNTn()cX
               1                                SUMMARY OF THE CLAIMS

              2           1.   By means of this class action, Plaintiff seeks to redress the unlawful and

              3    deceptive practices employed by Defendant Orbtiz, LLC ("Orbitz" or the "Company") in

              4    connection with its failure to disclose certain mandatory hotel charges. Plaintiff alleges

               5   that Orbitz engaged in tortious unlawful and deceptive business practices in violation of

               6   Business & Professions Code § 17200, et seq., California Civil Code § 1750, et seq. (the

               7   California Consumers Legal Remedies Act) and the contractual rights of consumers.

               8          2.   This class action is brought by Plaintiff individually and as a class action

               9   pursuant to Code Civil Procedure § 382 and California Civil Code § 1781. Plaintiff seeks

              10   to represent two Sub-Classes (collectively, the "Class") consisting of:

              11          Subclass I: All California residents who: (1) from June 22, 2001 through the date
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              15          Ritz Carlton or Mandalay Bay Group brand hotel, motel, resort, or other lodging
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              16          place; (2) were required to pay certain mandatory "Hotel Fees/Taxes" designated

              17          as hotel service, airport, transportation, parking, convenience, energy, safe, safe

              18          warranty, utility, resort, resort services, facility and/or convenience fees, and/or

              19          taxes, such as an occupancy tax, in addition to the price that they contracted to pay

              20          Orbitz; and (3)(a) did not receive notice of the mandatory Hotel Fees/Taxes at the

              21          time they reserved and paid for their accommodation through Orbitz and/or (b)

              22          were misinformed or misled about the nature, purpose, scope, amount, fairness or

              23          ultimate recipient of mandatory Hotel Fees/Taxes due to information they received

              24          at the time of reservation from Orbitz.

              25          Subclass II: All non-residents of California who: (1) during the Class Period

              26          booked a room or other lodging accommodation through Orbitz at a Choice,

              27          Disney, Hyatt, Hilton, Marriott, Starwood, Four Seasons, Ritz Carlton, Kimpton,

              28          Fairmont or Wyndham brand hotel, motel, resort, or other lodging place located in
                      THIRD AMENDED CLASS ACTION
                      COMPLAINT                                 - 1•
       1         the State of California; (2) were required to pay mandatory Hotel Fees/Taxes in

      2          addition to the price that they contracted to pay Orbitz; and (3)(a) did not receive

      3          notice of the mandatory Hotel Fees/Taxes at the time they reserved and paid for

       4         their accommodation through Orbitz and/or (b) were misinformed or misled about

       5         the nature, purpose, scope, amount, fairness or ultimate recipient of mandatory

       6         Hotel Fees/Taxes due to infonnation they received at the time of reservation from

       7         Orbitz.

       8             3.   Plaintiff seeks redress for a corporate scheme of unlawful, deceptive and

       9   wrongful practices by Defendant of failing to disclose all mandatory fees required at

      10   hotels that were booked through Orbitz. Specifically, Plaintiff claims, on behalf of herself

      11   and all others similarly situated, that Defendant maintained an unlawful, inequitable and
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      12   unfair practice of providing misleading hotel room quotes, and induced consumers to
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      13   book and pay for hotel rooms or other lodging accommodations without adequately
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      15             4.   By virtue of its position as one of the leading online travel providers, Orbitz
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      16   had actual and/or constructive knowledge throughout the Class Period that these

      17   additional mandatory Hotel Fees/Taxes existed at certain hotels that are booked through

      18   Orbitz, but failed to adequately disclose, and indeed affinnatively disguised the Hotel

      19   Fees/Taxes.

      20             5.   During the Class Period, hundreds of thousands, if not millions, of consumers

      21   incurred Hotel Fees/Taxes because of the false and deceptive disclosures delivered by

      22   Orbitz.

      23             6.     For example, when Plaintiff made her reservation through Orbitz at the

      24   Westin Mission Hills Resort & Spa, Orbitz provided her a firm quoted room rate that

      25   purportedly included all "Taxes & fees." The cost summary for the quote provided an

      26   itemized breakdown of the "Total cost," including the room cost, plus other "Taxes &

      27   fees," and the required "charges at checkout." Plaintiffthen submitted payment for what

      28   she reasonably believed was the total cost for the hotel room, including taxes and fees.
             THIRD AMENDED CLASS ACTION
             COMPLAINT                                    -2 -
                  1          7.   When Plaintiff and Class members agreed to pay Orbitz the "Total cost," and

                 2    submitted payment to Orbitz, they logically and reasonably believed they had paid all

                 3    mandatory charges for the hotel room and would not have to pay any other required

                 4    charges, taxes or fees. However, only after Plaintiff and Class members checked-out were

                  5   they infonned that they had been charged mandatory Hotel Fees/Taxes for each night of

                 6    lodging above and beyond the "total cost" they had previously agreed to pay and actually

                  7   paid Orbitz. In Plaintiffs case the Hotel Fees/Taxes amounted to $14 per day above and

                  8   beyond the "total cost" of the room quoted and guaranteed by, and paid to, Orbitz.

                  9          8.    Generally, Hotel Fees/Taxes run between 5% to 20% of the quoted room rate.

                 10   Despite Orbitz's actual and/or constructive knowledge of the mandatory Hotel

                 11   Fees/Taxes, it failed to disclose these Hotel Fees/Taxes, or even the possibility that these
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                 13   telephone and/or Obitz's web site.
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       <         14          9.    As a direct and proximate result of Defendant's deceptive and wrongful
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                 16   economic damages. Plaintiff therefore brings the common law and statutory claims

                 17   alleged herein to bring a halt to Defendant's deceptive practices and to obtain

                 18   compensation for the losses suffered by Plaintiff and all Class members.

                 19                                    JURISDICTION AND VENUE

                 20           10. This Court has jurisdiction over all causes of action asserted herein pursuant to

                 21   the California Constitution, Article VI, § 10, because this case is a cause not given by

                 22   statute to other trial courts.

                 23           11. This Court has jurisdiction over the Defendant named herein because

                 24   Defendant is either a corporation or association organized under the laws ofthe State of

                 25   California, a foreign corporation or association authorized to do business in California and

                 26   registered with the California Secretary of State, or does sufficient business in California,

                 27   has sufficient minimum contacts with California or otherwise intentionally avails itself of

                 28   the laws and markets of California, through the promotion, sale, marketing and
                        THIRD AMENDED CLASS ACTION
                        COMPLAINT                                 - 3-
          1   distribution of its services in California, to render the exercise ofjurisdiction by the

         2    California courts permissible

         3           12, Venue is proper in this Court because Plaintiff resides in Los Angeles County.

         4    In addition, Defendant has received substantial compensation from California consumers

         5    who reserve rooms and travel through its reservation service.

         6                                           THE PARTIES

          7          13. Plaintiff Nicole Montgomery is a resident of California. On May 20, 2005,

          8   Plaintiff made a hotel reservation through Obrtiz's web site. The reservation was for a

          9   hotel room at the Westin Mission Hills Resort & Spa in Rancho Mirage, California. From

         10   May 21, 2005 to May 22, 2005, Plaintiffwas a guest of the Westin Mission Hills Resort &

         11   Spa.
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0        12          14, Orbitz is a leading online travel company. Orbitz's inventory for booking
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         13   includes tens of thousands oflodging properties worldwide, over 455 airlines and 22
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         15   net income of $146 million and 1,600 employees. According to a December 2007 article
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         16   in Business Week, Orbitz has a 24% share of the U.S. online travel market

         17          15. Each Defendant is sued individually and as an agent, conspirator, aider and

         18   abettor, and/or as a control person for each and every other Defendant, and the liability of

         19   each Defendant arises from the fact that it has engaged in all or part of the unlawful acts,

         20   plans, schemes or transactions complained of herein. The true names of the Defendants

         21   named in this action as Does 1 through 100 are unknown to Plaintiff, who therefore sues

         22   those Defendants by fictitious names, Plaintiff will amend this Complaint to allege the

         23   true names of Does 1 through 100 when Plaintifflearns those names.

         24
         25
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                 THIRD AMENDED CLASS ACTION
                 COMPLAINT                                 -   4-
            I                       THE FACTS AND CIRCUMSTANCES THAT

           2                 SUPPORT A RECOVERY BY PLAINTIFF AND THE CLASS

           3           16. Defendant contracts with tens of thousands, ifnot hundreds of thousands, of

           4    consumers on a daily basis to sell travel services, including, but not limited to, hotel

           5    reservation services. It regularly quotes hotel room rates in various ways, including in

           6    printed advertisements, electronic advertisements, emails.mailers and on the pages of its

           7    Web site.

            8          17.   Throughout the Class Period, Defendant offered consumers binding quotes

            9   for hotel rooms. These quotes were provided in writing, orally, or through electronic

           10   agents by means of a computer display. In each case, Defendant's offer stated thatthe

           11   price quoted by Defendant for the hotel property and dates of stay selected by the
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           13   each case, Defendant's offer stated, in sum or substance, that the quoted "Total cost"
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           15   purchased, and also includes a charge for our services" and excluded only "incidental
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           16   charges, such as room service" and "extra charges [that] may apply for children."          In

           17   each case, Defendant's offer purported to identify any other "charges collected at

           18   checkout" not included in the quoted "Total cost."

           19          18. In many cases, Defendant's offer was false and misleading because the quoted

           20   "Total cost" did not include, and the offer did not otherwise disclose, the substantial non-

           21   incidental, mandatory Hotel Fees/Taxes that Defendant was fully aware would be

           22   collected by the hotel from the consumer at check out. Consumers who accepted

           23   Defendant's offer were required to do so by immediately submitting to Defendant

           24   payment, in full, of the "Total cost" quoted by Defendant. Generally, the contract

           25   provided that the reservation was non-changeable and non-refundable.

           26          19. Consumers who accepted Defendant's offer reasonably believed that they had

           27   paid the full cost for the hotel room they had reserved, including all taxes and mandatory

           28   charges.
                   THIRD AMENDED CLASS ACTION
                   COMPLAINT                                 -5-
          I          20. The contract thus required each consumer to pay up front what was

         2    purportedly the "Total cost" including all "Taxes & fees" for their room for their entire

          3   stay. The contract also purported to disclose to the consumer any additional charges that

         4    would be collected by the hotel at checkout. However, in reality, Class Members had not

          5   paid the Defendant for the full cost of their hotel rooms because they were required to pay

         6    additional non-disclosed mandatory Hotel Fees/Taxes directly to the hotel property upon

          7   checkout.

          8          21.   Orbitz, as one of the leading providers of online travel services, at all times

          9   during the Class Period had close business relationships, including through distribution

         10   agreements and other contractual relationships, with the hotel brands available for

         11   booking through Orbitz. Among other things, Orbitz has a global team of employees
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         12   dedicated to "hotel supplier relations." As a result, Orbitz had actual and/or constructive
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     z   13   notice that certain hotels imposed additional mandatory Hotel Fees/Taxes that Orbitz
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         IS          22. The Hotel Fees/Taxes were imposed on Class Members for each day of their
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         16   stay at a hotel and were not optional or "incidental," but rather were mandatory_

         17   Generally, during the Class Period, Hotel Fees/Taxes ran between 5% to 20% ofthe

         18   quoted room rate.

         19          23. Despite Orbitz's actual and/or constructive lmowledge of the existence of the

         20   Hotel Fees/Taxes charged by many hotels available for booking through Orbitz, it was the

         21   practice of Defendant not to disclose these Hotel Fees/Taxes. Rather, Defendant provided

         22   room rate quotes, accepted non-refundable and non-changeable reservations, and received

         23   payment in full for the purported "Total cost" of reservations without ever disclosing that

         24   the consumer would be required to pay additional mandatory Hotel Fees/Taxes above and

         25   beyond the total cost agreed to. Defendant therefore deceived Class Members by

         26   withholding necessary information, prevented the Class Members from making informed

         27   decisions, and breached its contracts with Class Members.

         28          24. The hotel room rates that Defendant quoted to Class Members were
                THIRD AMENDED CLASS ACTION
                COMPLAINT                                  -6-
        1   inaccurate, unfair, misleading and intentionally deceptive, because the price that the Class

       2    Members were ultimately charged for their hotel rooms was invariably higher than the

       3    amount Class Members contracted with Orbitz to pay.

       4           25. Through its deceptive and unfair practice Defendant was able to quote hotel

        5   rooms at a lower price that purportedly included all charges to be collected by the hotel at

       6    check out, but that did not actually reflect the true cost of the hotel stay including the

        7   mandatory Hotel Fees/Taxes imposed by the lodging property. This unfair price

        8   advantage was of special value to Defendant when consumers use multiple online travel

        9   search engines to compare prices and book travel.

       10          26. Defendant induced consumers to use its lodging reservation services by

       11   misrepresenting the actual cost for lodging and purporting to disclose all charges and
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       12   taxes to be collected by the hotel. Class Members were not notified of the true cost of
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3      13   their hotel rooms until it was too late - at arrival or upon check-out - and long after they
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       15   competitive advantage over other travel web sites and other travel service providers who
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       16   quoted the true price of lodging to consumers, or at a minimum provided adequate

       17   disclosure of Hotel Fees/Taxes. Defendant's practice of not disclosing and affirmatively

       18   disguising Hotel Fees/Taxes has no utility whatsoever and cannot be justified in light of

       19   the substantial harm to consumers.

       20                                      PLAINTIFF'S FACTS

       21          27. Plaintiff Nicole Montegomery is a resident of Los Angeles County, California

       22   and is a member of the Class alleged herein.

       23          28. On or about May 20, 2005, Plaintiff reserved a hotel room for personal use for

       24   the night of May 21, 2005 through Orbitz's web site. Plaintiff paid Orbitz in full for the

       25   hotel room at the Westin Mission Hills Resort & Spa, one ofthe hundreds of thousands of

       26   hotels that can be booked and paid for through Orbitz.

       27          29. Orbitz's written offer to Plaintiff stated that the price of the hotel room would

       28   be $214 per night plus "Ta-xes & fees" in the amount of$39.30 for a "Total cost" of
               THIRD AMENDED CLASS ACTION
               COMPLAINT                                 - 7 -
          1   $253.41. Orbitz made two written statements to Plaintiff regarding additional fees and/or

         2    costs associated with the room rate. First, in its offer and receipt, Orbitz stated that the

         3    total cost excluded incidental charges (described as room service). Second, the offer and

         4    receipt had a separately itemized line below the "Total cost" that stated: "charges collected

          5   at checkout:." A blank space followed the colon on this line, reasonably indicating to

         6    Plaintiff that there were no such charges. Orbitz made no other statements to Plaintiff

          7   regarding mandatory Hotel Fees/Taxes. Attached hereto as Exhibit A is a true and

          8   correct copy of the itemized receipt provided to Plaintiff by Orbitz.

          9          30. In order to accept Orbitz's offer and purchase the hotel stay, Plaintiff

         10   immediately remitted to Orbitz payment in the total amount of$253.41.

         11          31. The only disclosures Defendant made to Plaintiff regarding additional fees not
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         12   included in her room rate were that "incidental charges, such as room service, are not
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         13   included in the rate" and "Extra charges may apply for children." Defendant did not
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         15   leading her to believe reasonably that her total room cost was $253.41. In reality, the cost
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         16   of Plaintiffs room was $267.41 because Plaintiff was charged a "Resort Service Fee" of

         17   $14.00 upon checking out of her room. Attached as Exhibit B is a true and correct copy

         18   of the itemized bill presented to Plaintiff by Westin Mission Hills Resort & Spa on May

         19   22,2005.

         20          32. Plaintiff did not learn about the non-disclosed mandatory "Resort Service

         21   Fee" until she checked out of the hotel. But, at that point, the Plaintiff had already paid

         22   Orbitz the "Total cost" of her non-changeable, non-refundable reservation, traveled over a

         23   hundred miles, checked into the hotel property, and stayed at the hotel property.

         24          33. Defendant never disclosed or otherwise informed Plaintiff that the hotel she

         25   had selected to stay at imposed mandatory Hotel Fees/Taxes on all guests. To the

         26   contrary, Defendant's offer and receipt stated that "Taxes & fees" were included in the

         27   "Total cost" of$253.41and indicated that no "charges to be collected at checkout" were

         28   present. Thus, the only additional charges disclosed by Defendant were that optional
                THIRD AMENDED CLASS ACTION
                COMPLAINT                                  - 8-
      I   items such as "room service" or extra charges "for children" may apply.

     2           34. Because Defendant failed to disclose the true cost of lodging when Plaintiff

     3    made her reservation and paid for it, Plaintiff did not and could not have known that the

     4    true rate would be significantly higher than the rate she was quoted, contracted to pay and

      5   paid in full to Orbitz.

     6           35. At no time before, during or after Plaintiff purchased her room did Orbitz

     7    inform her that her room rate would be higher and/or that the amount she had paid Orbitz

      8   did not include mandatory Hotel Fees/Taxes.

      9                              CLASS ACTION ALLEGATIONS

     10          36. This case is brought as a class action pursuant to California Code ofCivil

     II   Procedure § 382. Plaintiff seeks certification of this action as a class action on behalf of
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     12   two sub-classes.
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~    13          37. Subclass I which Plaintiff seeks to represent consists of: All California
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~    14   residents who during the Class Period: (I) booked a room or other lodging
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     15   accommodation through Orbitz at a Choice, Disney, Hyatt, Hilton, Marriott, Starwood,
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     16   Station Casino, Kimpton, Fairmont, Wyndham, Four Seasons, Ritz Carlton or Mandalay

     17   Bay Group brand hotel, motel, resort, or other lodging place; (2) were required to pay

     18   mandatory Hotel Fees/Taxes in addition to the price that they contracted to pay Orbitz;

     19   and (3)(a) did not receive notice of the mandatory Hotel Fees/ Taxes at the time they

     20   reserved and paid for their accommodation through Orbitz and/or (b) were misinformed or

     21   misled about the nature, purpose, scope, amount, fairness or ultimate recipient of

     22   mandatory Hotel Fees/ Taxes due to information they received at the time of reservation

     23   from Orbitz.

     24          38. Sub-class II which Plaintiff seeks to represent consists of: All non-residents

     25   of California who during the Class Period: (1) booked a room or other lodging

     26   accommodation through Orbitz at a Choice, Disney, Hyatt, Hilton, Marriott, Starwood,

     27   Four Seasons, Ritz Carlton, Kimpton, Fairmont or Wyndham brand hotel, motel, resort, or

     28   other lodging place located in the State of California; (2) were required to pay mandatory
             THIRD AMENDED CLASS ACTION
             COMPLAINT                                - 9-
          1   Hotel Fees/Taxes, in addition to the price that they contracted to pay Orbitz; and (3)(a)

         2    did not receive notice of the mandatory Hotel Fees/ Taxes at the time they reserved and

         3    paid for their accommodation through Orbitz and/or (b) were misinformed or misled about

         4    the nature, purpose, scope, amount, fairness or ultimate recipient of mandatory Hotel

          5   Fees/ Taxes due to information they received at the time of reservation from Orbitz.

         6           39. Defendant has engaged in a common course of misconduct by maintaining a

          7   practice of misrepresenting actual room rates at many of the hotels that are booked

          8   through Orbitz. Defendant affirmatively fails to disclose all mandatory Hotel Fees/Taxes

          9   when it quotes room rates and accepts full payment for a reservation which is often non-

         10   changeable and non-refundable once booked.

         11          40. Membership in the Class is so numerous that separate joinder of each member
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         12   is impracticable. The number of Class Members is unlmown, but can be readily
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         13   determined from Defendant's records. Plaintiff reasonably estimates that there are
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         15          41. Plaintiff is a member of the Class of victims described herein. She booked
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         16   and paid for lodging through the Defendant and was subjected to Defendant's common

         17   course of conduct.

         18          42. There are numerous and substantial questions of law and fact common to all

         19   Class Members that control this litigation and predominate over any individual issues.

         20   Included within the common questions are:

         21          a) Whether Defendant accepted reservations for hotels at a certain price without

         22             disclosing that additional mandatory Hotel Fees/Taxes would be imposed;

         23          b) Whether Defendant's acceptance of reservations and payment by consumers for

         24             hotels at a certain price constitutes a contract to sell lodging at that price;

         25          c) Whether Defendant breached those contracts by failing to disclose mandatory

         26             Hotel Fees/Taxes in addition to the quoted price;

         27          d) Whether Defendant maintained a corporate policy of not disclosing mandatory

         28              Hotel Fees/Taxes;
                 THIRD AMENDED CLASS ACTION
                 COMPLAINT                                - 10 -
                  1         e) Whether Defendant trained or directed its employees to conceal or not disclose

                 2              mandatory Hotel Fees/Taxes;

                 3          f) Whether Defendant devised and deployed a scheme or artifice to defraud, or

                 4              engaged in a common course of conduct which acted to defraud or deceive

                  5             Plaintiff and the Class;

                 6          g) Whether Defendant deLiberately misrepresented or failed to disclose material

                  7             facts to Plaintiff and Class Members regarding the true cost of the lodging that

                  8             Defendant sold to them;

                  9         h) Whether the non-disclosure of mandatory HoteL Fees/Taxes, separate from and

                 10             in addition to the regular room rate quoted by Defendant to Class Members, is

                 11             unLawfuL;
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                 12         i) Whether the non-disclosure of mandatory Hotel Fees/Taxes, separate from and
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3: ~. ~          13             in addition to the price quoted and agreed to by Class Members, is unfair;
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     ~           14         j) Whether Defendant's non-disclosure of Hotel Fees/Taxes, separate from and in
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                 16             deceitful;

                 17         k) Whether the acts of Defendant violated, inter alia, California Business and

                 18             Professions Code § 17200 and/or any other applicable state, common and

                 19             statutory law;

                 20         I) Whether Plaintiff and the Class have been damaged;

                 21         m) The proper method for calculating the damages suffered by Plaintiff and Class

                 22             Members;

                 23         n) Whether Plaintiff and Class Members are entitled to an award of punitive

                 24             damages against Defendant; and

                 25          0) Whether Plaintiff and Class Members are entitled to declaratory, injunctive

                 26             and/or other equitable relief.

                 27          43. Plaintiffs claims are typical of the claims of the Class, she possesses no

                 28   interests that are antagonistic to the interests of other Class Members, and she has retained
                        THIRD AMENDED CLASS ACTION
                        COMPLAINT                                - 11 -
            1   counsel experienced and competent in the prosecution of consumer fraud class actions and

           2    similar types of complex litigation,

           3           44. Plaintiff seeks injunctive and equitable relief including, but not limited to,

           4    restitution and disgorgement of all protits, compensatory and punitive damages on behalf

            5   of the entire Class because Defendant has acted or refused to act on grounds generally

           6    applicable to the entire Class.

           7           45. A class action is superior to other available methods for the fair and efficient

            8   adjudication of this controversy for at least the following reasons:

            9          a) Given the size of the claims of individual Class Members, as well as the

           10             resources of Orbitz, few, if any, Class Members could afford to seek legal

           11             redress individually for the wrongs alleged herein;
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           13              can determine the claims of each Class Member;
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                           of Class Members, will foster economies of time, effort and expense and will
           15
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           16              ensure unifonnity of decisions; and

           17          d) Without a class action, Class Members will continue to suffer damages,

           18              Defendant's violations of law will proceed without remedy, and Defendant will

           19              continue to reap and retain the substantial proceeds derived from its wrongful

           20              and unlawful conduct.

           21

           22
           23
           24

           25
           26

           27
           28
                  THIRD AMENDED CLASS ACTION
                  COMPLAINT                                - 12 -
                                                   FIRST CAUSE OF ACTION
                 1                              (Violation of California Business and
                2                            Professions Code 17200 and 17500, et seq.)
                             46. Plaintiff hereby incorporates by reference each ofthe preceding paragraphs as
                3
                     though fully set forth herein.
                4
                             47. California Business and Professions Code § 17200 prohibits acts of unfair
                5
                     competition, which include any "unlawful, unfair or fraudulent business practice..."
                6
                             48. Defendant has violated California Business and Profession Code § 17200's
                 7
                     prohibition against engaging in unlawful, unfair or fraudulent business practices by, inter
                 8

                 9
                     alia:
                                   a) providing Class Members with deceptive infonnation concerning the
                10
                     actual amounts they would be required to pay for hotel rooms; and
                11
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                                    b) engaging in the foregoing acts in order to obtain windfall profits at the
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                     expense of Plaintiff and the Class.
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                15
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                             50. Orbitz promoted its website as a place where consumers could "[f]ind cheap
                16
                     hotel rooms, discount luxury hotels and all-inclusive resorts." Moreover, Orbitz
                17
                     "guaranteed" that its hotel rates were "the lowest hotel rates online."
                18
                             51. Defendant was unjustly enriched because consumers paid it "in full," for their
                19
                     lodging reservations, reasonably relying upon Orbitz's representations that the price
                20
                     quoted by Orbitz and paid for by Plaintiff and all Class Members included "Taxes & fees,"
                21
                     was the "total cost," including all checkout charges and that only "incidental charges, such
                22
                     as room service" would be added to the "total cost." In reality substantial Hotel Fees/Taxes
                23
                     were added to the purported "total cost" paid by Plaintiff and Class Members.
                24
                             52. Pursuant to California Business and Professions Code § 17203, Plaintiff and
                25
                     the Class she seeks to represent are therefore entitled to: (a) an Order requiring Defendant
                26
                     to cease the acts of unfair competition alleged herein; (b) an Order enjoining Defendant
                27
                     from continuing to utilize its deceptive scheme; (c) full restitution and disgorgement by
                28
                        THIRD AMENDED CLASS ACTION
                        COMPLAINT                                - 13 -
           1   Defendant of all profits received by Defendant as a result of its wrongful practices; (d)

          2    interest at the highest rate allowable by law; and (e) the payment of their attorneys' fees

          3    pursuant to, inter alia, California Code ofCivil Procedure § 1021.5.

          4
                                           SECOND CAUSE OF ACTION
          5                              (Violation ofConsurners Legal Remedies Act)
          6           53. Plaintiff, individually and on behalf of all others similarly situated, hereby

          7    incorporates by reference the allegations contained in the foregoing paragraphs as if fully

           8   set forth herein.

           9          54. This cause of action is brought pursuant to the California Consumer Legal

          10   Remedies Act, California Civil Code §§1750, et seq., (the "CLRA").

          11          55. This action may be maintained as a class action under § 1781 of the CLRA for
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          12   the reasons set forth above.
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iii. l=   14   meaning ofCLRA § § 1761(d) and 1770(a) in that Plaintiff and all of the members ofthe
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          15
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          16   or household purposes.

          17          57. Orbitz violated § 1770(a)(9) of the CLRA through its acts and practices which

          18   resulted in the sale of goods, specifically, hotel rooms, at prices different from, and higher
               than, those advertised and agreed to.
          19
                      58. Orbitz violated § 1770(a)(14) of the CLRA, through its use of deceptive
          20
               representations.
          21
                      59. In violation of§1770(a)(18) of the CLRA, Orbitz's acts and practices
          22
               constitute representations that Orbitz had the right to negotiate the final terms, including
          23
               all mandatory Hotel Fees/Taxes for hotel accommodations.
          24
                      60. Pursuant to §1780(a)(2) of the CLRA, Plaintiff seeks an order enjoining the
          25
               above-described wrongful acts and practices of Orbitz, including, but not limited to, an
          26
               order enjoining Orbitz from the methods, acts and practices detailed in this Complaint.
          27
                      61. As authorized by statute and in compliance with the provisions ofCLRA
          28
                  THIRD AMENDED CLASS ACTION
                  COMPLAINT                                - 14 -
       1   §1782, Plaintiff, on June 21, 2005, and again on September 1, 2005, gave notice to Orbitz

      2    of her intention to file an action for monetary damages under CLRA § 1750, et seq.,

      3    unless Orbitz correct, repair, replace, or otherwise rectify the Consumer fraud resulting

      4    from its conduct. Defendant has refused to correct, and/or otherwise rectify the consumer

      5    fraud resulting from its conduct. Plaintiff and the Class are therefore entitled to the
           following relief from Defendant: compensatory damages in an amount to be determined at
      6
           trial; an order enjoining Orbitz from continuing its practice of failing to disclose
       7
           mandatory Hotel Fees/Taxes and affinnatively disguising the actual room ratefor hotels
       8
           available for booking through Orbitz; an Order providing Plaintiff and the Class with
       9
           restitution for the Hotel Fees/Taxes improperly imposed upon them; punitive damages in
      10
           an amount to be determined at trial; costs and attorneys' fees; and such other relief as the
      11
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      15          62. Plaintiff hereby incorporates by reference each of the preceding paragraphs as
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      16   though fully set forth herein.

      17          63. As detailed above, Orbitz sells travel services to consumers by telephone and

      18   through its web site located at www.orbitz.com. Many ofOrbtiz's transactions are

      19   automated transactions as defined in the Uniform Electronic Transactions Acts, California
           Civil Code § 1633.14(a)(1). Orbitz's website constitutes an "electronic agent" as defined
      20
           in California Civil Code §1633(f).
      21
                  64. Plaintiff and Members of the Class entered into express and implied in fact
      22
           contracts with Orbitz by telephone and through Orbitz's web site. In each instance, Orbitz
      23
           offered to sell, and the Class Member agreed to buy, lodging at a specific hotel property
      24
           on a specified night or nights for a specified "total cost" that included itemized "taxes &
      25
           fees" and excluded only "incidental charges, such as room service." For example, through
      26
           an electronic agent, Orbitz offered to sell Plaintiff a hotel room at the Westin Mission
      27
           Hills Resort & Spa in Rancho Mirage, California for a one night stay commencing on
      28
             THIRD AMENDED CLASS ACTION
             COMPLAINT
           1   May 21, 2005, for $214.11 plus $39.30 in "Taxes & fees" for a "Total Cost" of$253.41

          2    with no other charges to be collected at checkout.

          3           65. Plaintiff and Class Members accepted Orbitz's offer, and fully performed their

          4    obligations under the contract, by remitting to Orbitz the full amount of the "total cost"

           5   specified in Orbitz's offer. For example, on May 20, 2005, Plaintiff accepted Orbits's
               above-described offer by paying the amount of$253.4l via credit card information that
          6
               was electronically submitted to Orbitz's electronic agent. Orbitz promptly charged
           7
               Plaintiffs credit card the agreed to amount of$253.41. Upon electronically remitting her
           8
               full payment to Orbitz, Plaintiff received a booking confinnation number from Orbitz.
           9
               Her confinnation number was C34l225228.
          10
                      66. The price at which Defendant agreed to sell Plaintiff and each of the Class
          11
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          16
               and collected from Plaintiffs and Class Members in excess of the price that Plaintiff and
          17
               the Class Members had agreed to pay Orbitz for their hotel rooms. For example, Plaintiff
          18
               was charged a $14.00 "Resort Service Fee" over and above the $253.41 she paid to Orbitz
          19
               for her one night stay at Westin Mission Hills Resort & Spa in Rancho Mirage, California.
          20
                      68. As a result of the foregoing, Plaintiff and Class Members suffered injury and
          21
               are entitled to compensatory damages in an amount to be proven at trial.
          22
          23
                                            FOURTH CAUSE OF ACTION
                                                (Fraud and Deceit)
          24
                      69. Plaintiff hereby incorporates by reference each of the preceding paragraphs as
          25   though fully set forth herein.
          26          70. In order to maintain and/or increase its sales and profits, both directly and
          27   indirectly, by failing to disclose the actual price of lodging, Defendant, through its
          28
                 THIRD AMENDED CLASS ACTION
                 COMPLAINT                                - 16 -
       1   reservation system, advertising, promotional campaigns and marketing, has by the use of

      2    false statements and/or material omissions of fact, intentionally misrepresented that hotel

      3    rooms at particular hotels would be provided to Plaintiff and the Class Members at a price

      4    certain.

       5          71. Through its reservation system, advertisements and/or promotional materials,

       6   Defendant uniformly misrepresented and mischaracterized the price of hotel rooms by
           failing to disclose all mandatOly Hotel Fees/Taxes to Plaintiff and the Class Members.
       7
                  72. Defendant's statements, misrepresentations and/or omissions were material in
       8
           that there was a substantial likelihood that a reasonable consumer would have considered
       9
           them important and would have relied upon them in choosing hotel accommodations and
      10
           in deciding whether to enter into contracts with Defendant. Indeed, the Hotel FeeslTaxes
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      16
           made them in reckless disregard for their truth or falsity. Defendant knew such
      17
           infonnation was material to Plaintiff and Class Members, and knew or was reckless in not
      18
           knowing that the information was not disclosed.
      19
                  74. Defendant intended that the misrepresentations and omissions of fact be relied
      20
           upon by Plaintiff and the Class in choosing to book the particular hotel through
      21
           Defendant, rather than one of its competitors. Orbitz promoted its web site as a place
      22
           where consumers could "[f]ind cheap hotel rooms, discount luxury hotels and all-inclusive
      23
           resorts." Moreover, Orbitz "guaranteed" that its hotel rates were "the lowest hotel rates
      24
           online."
      25
                  75. Plaintiff and Class Members were unaware of the falsity of Defendant's
      26
           representations and omissions of material facts until they were eventually informed by the
      27
           individual hotels. Plaintiff and the Class Members reasonably relied on Defendant's
      28
              THIRD AMENDED CLASS ACTION
              COMPLAINT                               -   17 -
            1   misrepresentations and omissions to their detriment by: a) making reservation through

           2    Orbitz; b) paying Orbitz in full for the reservations; and c) traveling, hundreds or

           3    thousands of miles to, and staying at, the hotels reserved through Orbitz.

           4           76. As a result of Defendant's false representations and failures to disclose the

            5   true facts, Plaintiff and the Class Members have suffered injury entitling them to
                compensatory and punitive damages in an amount to be proven at trial.
            6

            7
                                                 FIFTH CAUSE OF ACTION
            8                                    (Negligent Misrepresentation)
            9          77. Plaintiff hereby incorporates by reference each of the preceding paragraphs as

           10   though fully set forth herein.

           11          78. In the course and scope of its business, through its reservation system,
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           15   provided. Defendant's statements, representations and/or omissions were material in that
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           16   there was a substantial likelihood that a reasonable consumer would have considered them

           17   important and would have relied upon them in choosing hotel accommodations and in

           18   deciding whether to enter into contracts with Defendant. Indeed, the Hotel Fees/Taxes

           19   often ran between 5% to 20% in addition to the quoted room rate.

           20          79. At the time Defendant made these misrepresentations and omissions of fact as

           21   alleged throughout this Complaint, it had no reasonable grounds for believing them to be

           22   true. Orbitz failed to exercise reasonable care or competence in providing information or

           23   communicating to Plaintiff and the Class Members accurate information regarding the

           24   actual price of hotel rooms purchased through Orbitz, including mandatory Hotel

           25   Fees/Taxes.

           26          80. Defendant intended that the representations and omissions of fact be relied

           27   upon by Plaintiff and the Class in choosing to book the particular hotel through

           28   Defendant, rather than one of its competitors. Orbitz promoted its web site as a place
                  THIRD AMENDED CLASS ACTION
                  COMPLAINT                                 - 18 -
       1   where consumers could "[f]ind cheap hotel rooms, discount luxury hotels and all-inclusive

      2    resorts." Moreover, Orbitz "guaranteed" that its hotel rates were "the lowest hotel rates

      3    online."

      4           81. Plaintiff and Class Members were unaware ofthe falsity of Defendant's

      5    representations and omissions of material facts until they were eventually informed by the

       6   individual hotels. Plaintiff and the Class Members reasonably relied on Defendant's

       7   misrepresentations and omissions to their detriment by: a) making reservation through

       8   Orbitz; b) paying Orbitz in full for the reservations; and c) traveling, hundreds or

       9   thousands of miles to, and staying at, the hotels reserved through Orbitz.

      10          82. By reason of the foregoing, Plaintiff and Class Members have been harmed

      11   and are entitled to compensatory damages in an amount to be established at trial.
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      12                                     PRAYER FOR RELIEF
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      13          WHEREFORE, Plaintiff, on behalf of herself and members of the Class defined
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      15          A.     An order certifying that this action may be maintained as a class action;
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      16          B.     Compensatory damages in an amount to be proven at trial, including any

      17   damages as may be provided for by statute;

      18          C.     Punitive damages;

      19          D.     Restitution and disgorgement ofthe unlawful profits collected by the

      20   Defendant;

      21          E.     An order requiring the disgorgement of and/or imposing a constructive trust

      22   upon the ill-gotten gains derived from Defendant's deceptive scheme;

      23          F.     An order providing for declaratory and/or injunctive relief:

      24                 (1)    declaring that Defendant must provide clear disclosure of all

      25                 mandatory Hotel Fees/Taxes imposed on consumers in connection with

      26                 room reservations;

      27                 (2)    enjoining Defendant from continuing the deceptive practices alleged

      28                 herein; and
              THIRD AMENDED CLASS ACTION
              COMPLAINT                               ·19·
           I                    (3)    granting other extraordinary equitable andlor injunctive relief as

           2                    permitted by law, including specific performance, reformation and

           3                    imposition of a constructive trust;

           4          G.        Prejudgment and post judgment interest at the prevailing legal rate;

           5          H.        Plaintiffs attorneys' fees and costs of suit; and

           6          I.        Such other and further relief as the Court may deem necessary and

           7   appropriate.

           8                                           JURY DEMAND

           9          Plaintiff, on behalf of herself and all others similarly situated, hereby demands a

          10   trial by jury.

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          12   DATED:           February 11,2008                        KALCHEIM LAW GROUP, P.C.


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          16

          17
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          19
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          21

          22
          23
          24
          25
          26
          27

          28
                 THIRD AMENDED CLASS ACTION
                 COMPLAINT                                   -   20 -

				
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