Back-tax payout pending from online travel company lawsuit
by Diane Wagner, staff writer
Dec 04, 2012 | 2062 views | 0 0 comments | 6 6 recommendations | email to a friend | print
Georgia cities and counties could learn by the end of the year how much in back taxes they’ll be getting from a class action lawsuit against online travel companies.

“We’ve gotten the data in and the accountants are going over it. There are thousands of hotels and addresses, so we have to create our own summary,” said Andy Davis of the Rome law firm Brinson, Askew, Berry, Richardson, Siegler and Davis.

Rome, Cartersville and Hart County filed the suit in 2005, contending companies such as Hotels.com and Expedia should be paying hotel-motel tax on the retail rate they charge their customers rather than the wholesale rate they pay for the rooms.

U.S. District Court Judge Harold L. Murphy granted class action status in 2011 to all local governments in the state that levy the taxes. In March 2012, he ruled the companies were liable for the difference, from May 16, 2011 onward.

Davis, whose firm is handling the case, said Murphy rejected a claim for back taxes to the date the lawsuit was filed but the ruling is being appealed.

“The brief is due Friday in the 11th Circuit,” he said.

The travel companies have deposited a lump sum plus 7-percent interest in an incremental tax fund the law firm has set up, but the proceeds won’t be distributed until the claims are sorted out.

“We hope to have it done by the end of the month,” he said.

The lump sum amount was not available Monday, but Davis said the funds — paid up through Oct. 31 — are expected to grow.

Under the class action settlement the travel companies will continue paying local governments the tax on the wholesale room rates and pay the difference into the incremental fund for distribution.

Davis said the law firm will be administering the fund through Dec. 31, 2020, unless the companies change their business model.
Comments
(0)
Comments-icon Post a Comment
No Comments Yet
Postings are not edited and are the responsibility of the author. You agree not to post comments that are abusive, threatening or obscene. Postings may be removed at our discretion.