NAD was in the process of deciding whether Priceline’s claim that customers could save “half off” or “up to half off” of hotel prices compared to Expedia and Hotels.com was misleading, when Expedia filed a Lanham Act false advertising suit. (NAD had previously resolved a different dispute involving the same parties.) NAD closed the case because the dispute at issue was now the subject of pending litigation, but expressed its willingness to reopen the case and render a decision should the court remand the case to NAD. Priceline filed a motion to stay and submitted a declaration from NAD noting it “believed it would be beneficial to share with the parties the analysis it would have conducted had procedural considerations not required an administrative closing.”
While the Court (Western District of Washington) concluded it had the power to order the requested stay, it would only do so if there would be “some advantage in terms of efficiency or fairness.” The Court concluded there would be neither in this case finding:
“nor is it this Court’s role to safeguard the relevance and effectiveness of an industry self-regulatory body. If NAD’s rules allow a challenger to ‘opt out’ of the NAD process by filing a duplicative court action, the obvious remedy would be to amend the rules if the industry agrees that this is not an optimal use of the parties’ or the organization’s time and resources. This Court will not provide a ‘fix’ or attempt to send any sort of ‘message’ to other participants in the NAD process based on the limited information before it.”
Will we see a rule change from the NARB? Stay tuned.
