Hotwire settles class action lawsuit for $130,000

By Kyla Asbury | Jul 22, 2014

OAKLAND, Calif. (Legal Newsline) - Hotwire has agreed to settle a class action against it alleging the company misled its customers by providing an estimated price for international vehicle rentals that did not include insurance fees or taxes.

Class members made reservations through Hotwire's website while in the United States for car rentals in a foreign country and received a confirmation from Hotwire that included an estimated amount of taxes or fees of $0, according to the settlement document filed June 20 in the U.S. District Court for the Northern District of California.

The settlement requires Hotwire to pay any administration costs exceeding $10,000, plus a total of $130,000, which will be distributed to class members. Attorneys will receive $44,400 in attorneys' fees and costs. Daniel Shahar will receive a service award of $500.

The lawsuit was initially filed in 2012 and claimed Hotwire misinformed consumers about the taxes and fees they would be required to pay when renting cars internationally.

The lawsuit also claimed that Hotwire provided customers with an estimated trip total that left off the taxes and fees the customer would have to pay, indicating that the estimated taxes and fees would be equal to $0, according to the suit.

Hotwire has denied the allegations but agreed to settle the class action lawsuit to avoid the expense and uncertainty of ongoing litigation.

Class members of the lawsuit include persons and entities in the United States who, from Nov. 27, 2008 until the present, made a reservation through the Hotwire website for a car rental in a foreign country and received a confirmation letter from Hotwire that include an estimated amount of taxes or fees equal to or less than $0.

Class members must have been in the United States when using the Hotwire website to make the car rental reservation.

The class has been limited to a specific list of 1,089 transactions by 1,076 persons, as identified in Hotwire's computer system.

The amount distributed to class members will be at least $10 per day of the car rental, according to the settlement documents.

If the settlement receives final approval, payments will automatically be mailed to class members.

Shahar was represented by Cory S. Fein, Michael A. Caddell and Cynthia B. Chapman of Caddell & Chapman.

Hotwire was represented by Rodney G. Strickland Jr., Dale Bish and Jessica L. Snorgrass of Wilson Sonsini Goodrich & Rosati.

U.S. District Court for the Northern District of California case number: 4:12-cv-06027

From Legal Newsline: Kyla Asbury can be reached at classactions@legalnewsline.com.

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