City Of Rome, Georgia, Et Al. V. Hotels.com, L.p., Et Al., Civ. Action No. 4: 05-cv-249-hlm (n.d Ga., May 8, 2006)

The Court denied Defendant’s (hereafter "Hotels.com")motion to dismiss this claim, in which Plaintiff (hereafter "the City") argued that Hotels.com failed to remit excise taxes collected from motel guests in connection with their purchase of hotel accommodations. However, the Court also dismissed the City’s claim to recover sales taxes allegedly due as a result of Hotel.com’s sales of hotel accommodations, holding that such claims could only be pursued by the Georgia Revenue Commissioner, who was not a party to this suit. Plaintiffs, Georgia cities and counties, brought this lawsuit pursuant to 28 U.S.C.A. § 1332 against Defendants, various online travel companies (Hotels.com, L.P., et al.). The City alleged that the companies underpaid Georgia local option sales taxes and county or municipal hotel excise taxes. Hotels.com filed a motion to dismiss the City's excise tax claims. The Court denied the motion, allowing portions of the City’s claim to proceed. However, the Court dismissed the City’s claim to recover sales taxes allegedly due as a result of Hotels.com's sales of hotel accommodations. Accordingly, the Court held that such claims could only be pursued by the Georgia Revenue Commissioner, who was not a party to this suit and had not yet made a determination that any such taxes had been improperly withheld by Hotels.com.

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