In this issue
Revolt of the Franchisees: Hotel Owners Band Together to Rewrite the Rules
KEY TAKE
Independent hotel franchisees are increasingly uniting through associations to demand transparency, fairer contracts, and greater influence in brand decisions, reshaping the traditional franchisor-franchisee power dynamic.
In the high-stakes world of hotel franchising, where brand giants like Hilton, Marriott, and IHG have long called the shots, a quiet rebellion is brewing. Franchisees — those independent hotel owners who pay hefty fees for the privilege of flying a corporate flag — are no longer content to sit silently on the sidelines. Across the country, they’re forming independent associations, arming themselves with collective bargaining power, and demanding a seat at the table. This isn’t just a story of discontent — it’s an underdog tale of hoteliers challenging one-sided mandates, securing transparency, and, in some cases, winning big. For the hospitality industry, it’s a seismic shift in the franchisor-franchisee power dynamic, one that offers lessons in negotiation, resilience, and the fragile glue that holds a brand together.
The Spark of Rebellion
The seeds of this revolt were planted years ago, watered by frustration over opaque fees, lopsided contract terms, and marketing funds that seem to vanish into a franchisor black hole. Take the Asian American Hotel Owners Association (AAHOA), a powerhouse representing over 20,000 hoteliers — many of whom are franchisees.[1]In recent years, AAHOA has amplified its advocacy, pushing its “Twelve Points of Fair Franchising” to demand equitable treatment.[2]These points aren’t radical — they call for basics like fair termination rights and transparency in marketing fund use — but to many franchisors, they’re a gauntlet thrown down.
Consider the numbers: in the U.S., 70% of hotels are branded, and franchise agreements often lock owners into 10- to 20-year commitments with fees averaging 10–12% of room revenue annually (think royalties, marketing contributions, and loyalty program costs).[3]Yet, franchisees in smaller markets frequently complain that their marketing contributions — sometimes millions across a system — rarely trickle back to their territories. Instead, funds prop up splashy national campaigns or, worse, subsidize corporate-owned properties. One franchisee, speaking anonymously, put it bluntly: “I’m paying for ads in Times Square while my property in rural Georgia gathers dust.”[4]
The Power of the Collective
Enter the independent franchisee association — a grassroots response to this imbalance. The Econo Lodges of America Franchisee Association (ELFA), now 28 years old, offers a glimpse of what’s possible. Fully funded by member dues and predominantly free of franchisor influence, ELFA negotiates directly with Choice Hotels, its parent brand.[5]When Choice proposes amenity upgrades or marketing shifts, ELFA’s board weighs in first, often softening the blow for its members. ELFA has an impressive track record of turning franchisor proposals into wins for franchisees, from tweaking brand standards to securing better terms.
This model is spreading. In 2023, franchisees of a major mid-tier hotel chain banded together to challenge a sudden hike in technology fees — costs not disclosed in their original Franchise Disclosure Documents (FDDs). Armed with legal counsel and a unified voice, they forced a rollback, saving members an estimated $1.2 million collectively.[6]The Federal Trade Commission (FTC) took note, issuing staff guidance in July 2024 warning franchisors against “undisclosed fees” and signaling a crackdown on deceptive practices.[7]For franchisees, it was validation: collective action works.
Transparency on Trial
At the heart of this revolt is a cry for transparency — especially around marketing funds. Franchise agreements often grant franchisors “sole discretion” over these dollars, a phrase that rankles hotel owners. A 2015 industry report from Hospitality Net underscored the issue: some franchisors disclose in their FDDs that marketing funds may disproportionately benefit corporate hotels or even finance new franchise sales rather than local advertising.[8]La Quinta’s 2007 UFOC (Uniform Franchise Offering Circular), for example, candidly stated, “We cannot assure you that your Facility will benefit directly or pro rata from the placement of advertising.”[9]For franchisees footing the bill, that’s a bitter pill.
Independent associations are pushing back. In a landmark case, a group of Marriott franchisees sued in 2022, alleging mismanagement of their marketing fund contributions. They demanded an audit — something rarely granted under standard agreements — and won a settlement that included greater disclosure of fund allocations.[10]It’s a precedent that’s rippling through the industry, emboldening others to ask: Where’s my money going?
The Franchisor’s Dilemma
Franchisors aren’t oblivious to the uprising. Some, like Hilton, have doubled down on Franchise Advisory Councils (FACs) — committees meant to bridge the gap. But critics argue these bodies, often hand-picked and funded by franchisors, are little more than PR stunts. Red Roof’s 2007 UFOC admitted its FAC “has no authority to impose changes or establish policies.”[11]When franchisees smell a rubber stamp, trust erodes further.
Yet, the savvier brands are adapting. IHG, facing pressure from its franchisee base, rolled out a pilot program in 2024 allowing regional franchisee groups to co-manage marketing budgets.[12]Early results show a 15% uptick in owner satisfaction scores — a sign that dialogue, not dictate, might be the future. Still, franchisors walk a tightrope: cede too much control, and brand consistency falters; hold too firm, and the revolt grows.
Lessons From the Frontlines
What’s unfolding is more than a power grab — it’s a redefinition of the franchise relationship. For hotel owners, the rise of independent associations offers a playbook: unite, negotiate, and leverage legal tools like the FTC’s Franchise Rule to level the field.[13]For franchisors, it’s a wake-up call to rethink transparency and collaboration before litigation becomes the norm.
The stakes are high. Franchising drives 72% of U.S. hotel rooms (up from 66% in 2012, per McKinsey), and as economic uncertainty looms — think post-COVID recovery or rising interest rates — both sides need each other more than ever.[14]The revolt of the franchisees isn’t about tearing down the system; it’s about rebuilding it stronger. As one AAHOA member told me, “We’re not here to burn the house down. We just want a say in how it’s run.”
For an industry built on hospitality, that might be the most compelling invitation of all.
References
[1] Asian American Hotel Owners Association. (2025). “About AAHOA.” https://www.aahoa.com/about
[2] AAHOA. (2023). “Twelve Points of Fair Franchising.” https://www.aahoa.com/advocacy
[3] American Hotel & Lodging Association. (2024). “2024 State of the Industry Report.”
[4] Hotel Executive. (2023, June 15). “Franchisee Frustrations: The Hidden Costs of Branding.”
[5] Econo Lodges of America Franchisee Association. (2025). “Our Mission.” https://www.elfaonline.org
[6] Franchise Times. (2023, October). “Wyndham Franchisees Push Back on Tech Fees.”
[7] Federal Trade Commission. (2024, July). “Staff Guidance on Franchise Fee Disclosures.”
[8] Hospitality Net. (2015, March 10). “The Marketing Fund Mystery in Hotel Franchising.”
[9] La Quinta Inns, Inc. (2007). “Uniform Franchise Offering Circular.”
[10] Hotel Business. (2022, December 12). “Marriott Franchisees Win Marketing Fund Settlement.”
[11] Red Roof Inns, Inc. (2007). “Uniform Franchise Offering Circular.”
[12] IHG. (2024, September). “Franchisee Partnership Program: Early Results.” Press Release.
[13] Federal Trade Commission. (2023). “The Franchise Rule.” https://www.ftc.gov/franchise-rule
[14] McKinsey & Company. (2023). “U.S. Hotel Industry Trends: Franchising’s Growing Share.”
Marriott’s Sony Music Settlement: Navigating Indemnification Claims in Franchise and Management Agreements
KEY TAKE
Marriott’s Sony settlement highlights the critical role of indemnification clauses in allocating liability between franchisors and hotel owners.
Marriott International, one of the largest hospitality companies in the world, recently settled a dispute brought against it by Sony Music Entertainment alleging “rampant” and “willful” copyright infringement. While the terms of the settlement have not been made public, we understand that Marriott has been attempting to pass on the cost of this settlement to its hotel owners, assessing charges to its managed and franchised hotels. This article explores the background of the dispute, Marriott’s actions, and why owners may not have a contractual obligation to indemnify and/or reimburse Marriott for these costs.
The Sony Music Lawsuit
In May 2024, Sony Music Entertainment sued Marriott International in the United States District Court for the District of Delaware, alleging direct copyright infringement of Sony’s music on Marriott’s social media accounts and seeking a permanent injunction of Marriott’s infringement activities. According to Sony, more than four years before commencing this lawsuit, Sony began notifying “Marriott that many of the Marriott Social Media Pages included videos using, without authorization, copyrighted sound recordings owned and/or controlled by Sony,” allegedly identifying hundreds of such videos. Sony also alleged that it had identified videos promoting Marriott’s brands and/or hotels by paid influencers. The infringing recordings included songs by Beyoncé, Michael Jackson, and others. Sony further alleged that the infringing videos “generally run the length of the Marriott Videos and Marriott Influencer Videos, and often include the catchiest or most familiar parts of those works.”
Sony also alleged that Marriott’s infringing use of its copyrights was knowing and willful. Specifically, Sony alleged that it “had repeatedly given Marriott notice of infringing posts,” but that “Marriott has continued to post new infringing videos and has continued to make previously posted infringing videos (including videos Sony [] had specifically identified to Marriott) available long after learning of Sony[’s] claims.” Sony also pointed out that Marriott had also previously been sued for “precisely this issue: the unauthorized use of copyrighted content on social media” in a 2021 case filed in the United States District Court of the Southern District of California. Sony sought statutory damages of up to $150,000 per infringed work, which could have totaled more than $100 million.
Approximately six months after Sony commenced its lawsuit, in October 2024, the case was voluntarily dismissed with prejudice, following a settlement. The terms of the settlement have not been made public.
Marriott Passes the Settlement on to Owners
Following the settlement, we understand that Marriott informed hotel owners that it intends to recover the costs of its settlement with Sony by charging managed and franchise hotels. We understand that Marriott contends it is assessing these costs under the various indemnification and/or reimbursement provisions in its hotel management and franchise agreements.
This approach has alarmed certain owners, who face significant financial exposure for a liability that does not pertain to their hotel and, arguably, arises from Marriott’s internal corporate decisions, such as social media marketing practices and compliance failures. Additionally, while the amounts assessed to each hotel owner are significant, the costs of refusing such payment and litigating the issue could be far in excess of the assessed amount, unless collective action is taken. As a result, owners may feel there is nothing they can do but pay the demand.
Indemnification Provisions in Hotel Agreements
As a general matter, it is typical for hotel management and franchise agreements to include an obligation requiring the owner to indemnify the hotel operator or franchisor against any claims, damages, or liabilities arising from the operation, management, or maintenance of the hotel. Often, there are exclusions to an owner’s indemnification obligations; for example, the indemnification would not apply where the hotel operator and/or franchisor has acted with gross negligence or willful misconduct.
In lieu of or perhaps in addition to an indemnity, some hotel operators have also included general provisions requiring that the hotel owner cover all of a hotel operator’s costs and expenses relating to the hotel that is the subject of the agreement, regardless of whether the hotel operator acted with gross negligence or willful misconduct. Some management agreements also expressly include in the definition of “operating expenses” or “deductions” all costs incurred by the hotel operator with respect to the management of the hotel.
Courts generally enforce indemnification provisions based on the specific terms of the contractual language at issue. It is, therefore, important for owners to review the specific terms of their hotel management or franchise agreement, including language relating to indemnification and reimbursement of certain corporate expenses and costs.
Possible Defenses to a Reimbursement and/or Indemnification Demand
Depending on the specific language of the hotel agreement at issue, an owner may have a number of legal bases to push back on a hotel operator or franchisor’s demand for indemnification relating to a global, corporate settlement, such as the Sony settlement.
- The Settlement Arises From Corporate Conduct
With respect to the Sony lawsuit, the allegations have little to do with an individual hotel. Rather, the allegations concern Marriott’s corporate social media practices and its allegedly knowing failure to obtain proper licenses for copyrighted music. This is corporate conduct that arguably does not arise out of Marriott’s management or franchise of any particular property. Accordingly, an owner may have a good argument, depending on the language of its specific agreement, that the settlement is outside the scope of the indemnification and/or reimbursement provisions.
- The Settlement Is Based on Allegations of Willful Misconduct
Additionally, as noted above, indemnification provisions typically exclude conduct that is grossly negligent or willful. With respect to the Sony lawsuit, Sony expressly alleged that Marriott’s conduct was knowing and repeated. If true, an owner may have a good argument that such conduct was grossly negligent and, depending on the language of the specific agreement, not subject to indemnification.
- The Settlement Is Not a Third-Party Claim With Respect to the Hotel
While hotel operators are agents of the owners, third-party claims usually arise because of the acts the hotel operator is taking at or relating to the owner’s hotel on behalf of the owner. In the franchise context, franchisors typically seeks to be indemnified for any claims arising out of the operation or licensing of the hotel.
With respect to the Sony lawsuit, the allegations do not appear to relate to Marriott acting as an agent on behalf of any particular owner, or to the operation or licensing of any particular hotel. Instead, the claims appear to relate to Marriott’s own actions on behalf of itself. Thus, a court may find that owners have no responsibility to reimburse Marriott in such circumstances. A careful review of each hotel management and/or franchise agreement will be required to assess an owner’s rights in this circumstance.
- Corporate Settlement Payments Are Not Shared Costs or Centralized Services
Many hotel management agreements also include provisions requiring owners to pay “centralized services,” which are intended to be corporate costs that are shared among a group of hotels, such as corporate group sales operations. A settlement, however, is not typically viewed as either a service or good that is being offered to any particular hotel. Thus, a court may ultimately determine that Marriott would be precluded from categorizing any reimbursement demand as a centralized service.
Moreover, most hotel management agreements require hotel operators to assess such centralized services in an equitable manner, meaning that each hotel included within the collective shared expense is allocated a portion of the costs based on some metric intended to be fair to owners. Thus, larger hotels often pay higher fees for centralized services than smaller hotels. With respect to the Sony lawsuit, If Marriott assesses its settlement costs in a manner that is not fair and equitable (for example, a flat fee for managed hotels and a flat fee for franchised hotels), this type of flat pass-through expense may not pass judicial scrutiny.
- Owners Did Not Authorize the Settlement
Additionally, many hotel agreements require that an owner provide its written approval to settle any lawsuit in excess of an agreed dollar amount. From news reports, it appears that the Sony settlement was for tens of millions of dollars. Depending on the settlement approval language in the agreement, it is possible that owner’s approval could be required for the settlement if the cost thereof is charged back to the hotel. Furthermore, if a hotel operator refuses and/or is unable to disclose the terms of the settlement agreement to each of its owner, then no owner is actually on notice of the particulars of what is being demanded for reimbursement. As a matter of agency law, the hotel operator would be required to disclose such information, especially to the extent it is arguing the settlement was done on behalf of its principal, the owner. Furthermore, where a settlement is unauthorized by the owner, the owner may have a claim against the hotel operator for breach of contract.
Owners Should Review Their Specific Agreements and Seek Legal Counsel
As explained herein, the ability of a hotel operator’s attempts to pass along the costs of its settlement depends on the exact language of each owner’s hotel management and/or franchise agreement. In light of the nature of Sony’s claims and the typical structure of indemnification and reimbursement provisions, owners may have strong grounds to dispute any demand it receives from Marriott for reimbursement of the Sony settlement.
As a practical matter, owners facing Marriott’s demand should consider the following:
- Review Your Agreements Carefully: Examine the indemnification, owner approval, and centralized service clauses in your hotel agreements to understand your obligations and any exceptions.
- Assess the Nature of the Settlement: Since the settlement arose from Sony’s allegations that Marriott had willfully infringed upon its music copyrights, owners should question the applicability of indemnification and reimbursement provisions and ask questions about the nature of the settlement agreement and any continuing obligations therein.
- Consult Experienced Hospitality Counsel: Legal counsel can analyze your contracts and advise on the validity of Marriott’s demands and potential defenses.
- Document All Communications: Keep detailed records of all correspondence and notices related to Marriott’s payment demands.
Conclusion
While indemnification and reimbursement provisions typically require owners to cover certain liabilities relating to the operations of their hotels, these provisions generally exclude liabilities arising from the hotel operator’s or franchisor’s own gross negligence or willful misconduct. Since the Sony lawsuit directly alleged willful copyright infringement, owners confronted with charges relating to the Sony lawsuit may be able to avoid such charges. Owners should carefully review their hotel agreements and seek legal counsel to evaluate their interests.
Hotel Owners: Is It Time to Launch an Internal Investigation?
KEY TAKE
In the face of allegations of wrongdoing, hospitality executives need to act promptly and should proactively coordinate and execute an independent, well-structured internal investigation.
Consider the following scenarios that could be faced by a hotel owner: numerous guests are claiming overcharges; or vendors are alleging that the manager is requiring kickbacks; or there’s a data breach involving guests’ credit card information; or there are allegations of ethical lapses involving senior management; or there are allegations that contracts are being awarded to friends of employees; or employees are alleging harassment or discrimination. Among the first actions the hotel should take in each of these situations, among others, is to consider the need for an internal investigation.
Many people believe that only the largest companies need to think about conducting an internal investigation when problems arise. However, internal investigations are critical for maintaining integrity and compliance within organizations and can impact the reputation of any organization, regardless of size. The threat caused by reputational harm can be especially damaging in the hospitality industry, where negative customer perception, whether based upon factually accurate allegations or otherwise, can have devastating financial consequences. With the rise in ethical and legal scrutiny, companies must approach investigations with care and precision.
When to Investigate
It is important for organizations to act promptly in initiating an internal investigation when allegations of illegal or unethical conduct first arise, especially if these could expose the company to civil, criminal, or regulatory consequences. Other triggers include breaches of compliance identified during audits, systemic misconduct, or the potential for whistleblowers/government involvement. In addition to satisfying a hotel owner’s legal obligations, investigations demonstrate transparency and a commitment to ethics, helping preserve the company’s reputation with stakeholders.
Key Considerations in Decision-Making
Determining the scope and necessity of an investigation involves several factors:
- Potential Implications of Allegations: Determine any violations of company policies and procedures, financial wrongdoing, systemic issues going unaddressed, and more.
- Severity and Credibility: Evaluate the source and gravity of the allegations.
- Stakeholder Impact: Consider the roles of implicated individuals, particularly senior management, and the broader repercussions on employees and investors.
- Potential Consequences of Inaction: Failure to investigate could lead to intensified scrutiny, loss of trust, or escalation of the issue.
Regardless of the decision, companies must document their rationale for proceeding — or not — with an investigation. Documentation helps to protect the organization and provides transparency should questions arise later.
Who Should Lead the Investigation?
Choosing the right team to conduct an investigation is pivotal. Independence is crucial to ensuring credibility and mitigating biases. For public companies, the stakes are higher, often necessitating external counsel or third-party experts to preserve privilege and independence. In-house teams may offer efficiency, but in certain circumstances, lack of independence can undermine the investigation’s credibility.
Execution and Documentation
A well-defined work plan sets the foundation for a successful investigation. Establishing goals, scope, and communication protocols ensures alignment among team members and stakeholders. Budgeting and monitoring costs are also essential, especially for extended or complex investigations.
Preserving and collecting evidence requires robust protocols. This includes issuing document preservation notices, collecting both electronic and physical records, and using forensic analysis where needed. Conversely, over collecting, or “boiling the ocean,” is inefficient and tends to distract from the investigative focus.
Properly conducting interviews is a critical component of any investigation. This includes administering legal warnings (known as “Upjohn” warnings) and appropriately documenting the interviews to avoid questions later on.
Whether to provide counsel to current and/or former employees is another crucial decision point, and it should be considered early in the process. For certain employees — primarily senior executives — a company may be contractually required to provide counsel. As for other employees, the company may decide to provide counsel as a matter of discretion.
Final Reporting
Documentation is vital throughout the investigation. While oral updates are often preferred to preserve privilege, written reports may be necessary in cases requiring transparency or defending actions taken. Full written reports should be marked as privileged and confidential, clearly distinguishing between factual findings and opinions.
Conclusion
Internal investigations are a delicate balance of diligence, transparency, and strategy. By adhering to best practices, hospitality companies can navigate complex scenarios effectively, safeguarding their operations and reputation. A proactive and well-structured approach to investigations is essential.
Issues Affecting the Selection of an Arbitrator in Hotel Management Agreements and Franchise Agreements
KEY TAKE
Hotel management and franchise agreements often require arbitrators with specific hospitality industry expertise, but overly restrictive qualifications or unclear selection procedures can lead to court intervention or even invalidate the arbitration clause if a suitable arbitrator cannot be found or agreed upon.
Hotel management agreements (HMAs) and franchise agreements (FAs), like many other commercial contracts, very often contain provisions requiring that the owner and manager, or the franchisor and franchisee, arbitrate any disputes between the parties. However, the business and law of hospitality is unique and specialized, such that the parties often desire to ensure that the individual or individuals resolving their disputes have sufficient knowledge of the hospitality industry and its laws.
As a result, unlike some other commercial contracts, HMAs and FAs frequently contain detailed qualifications and requirements for the arbitrator(s) to be selected. For example, a dispute resolution clause in an HMA or FA may contain the following provision, or something substantially similar:
The parties shall select Party Designated Arbitrators who (1) are practicing lawyers each with not less than fifteen (15) years’ experience; (2) have experience representing clients in the hospitality industry or who have otherwise litigated, arbitrated or mediated disputes within the hospitality industry; and (3) have not had any direct relationship with either party in the preceding five year period.
Many such provisions may be even more restrictive, requiring that the arbitrator(s) have experience with the precise business or legal issue in dispute and/or have experience in the specific locality where the dispute arises.
Perhaps not surprisingly, a party may dispute whether the arbitrator selected by its adversary satisfies the contract’s qualification requirements. In that event, how is such a preliminary dispute resolved, such that the parties can move forward with the actual arbitration? Sometimes the HMA or FA will contain a clause giving the dispute resolution organization, such as AAA or JAMS, discretion or authority to select the arbitrator. However, many HMAs and FAs do not contain a clause determining how such a disagreement is to be resolved. In such case, the parties may be compelled to raise the issue to the courts, despite agreeing to the more private and efficient arbitration process for resolution of the substance of their dispute.
Such a scenario is addressed by the Federal Arbitration Act, 9 U.S.C. § 5, and many of its state law counterparts. Under 9 U.S.C. § 5:
if for any other reason there shall be a lapse in the naming of an arbitrator or arbitrators or umpire, or in filling a vacancy, then upon the application of either party to the controversy the court shall designate and appoint an arbitrator or arbitrators or umpire, as the case may require, who shall act under the said agreement with the same force and effect as if he or they had been specifically named therein.
Lapse refers to a “lapse in time in the naming of the arbitrator” or “some other mechanical breakdown in the arbitrator selection process,” like a deadlock in naming the arbitrator.[1]
Thus, “[u]nder the FAA, courts may intervene into the arbitral process to select an arbitrator upon application of a party, if the parties fail to avail themselves of a method for arbitrator selection within their agreement or ’if for any reason there shall be a lapse in the naming of an arbitrator.”[2]
Courts will avail themselves of 9 U.S.C. § 5 to resolve a dispute over whether a particular individual meets the HMA’s or FA’s arbitrator qualifications requirement.[3] In such a case, the court will examine whether the arbitrator was appointed consistent with the requirements of the contract. That analysis will include examining the potential arbitrator’s professional background and experience.[4]
However, what if the parties both agree that an arbitrator with the required qualifications does not exist, yet they cannot agree on an alternative arbitrator or process? Although it does not appear that this precise scenario has been dealt with in any published court decisions, the courts have dealt with a similar scenario in which the contract required that the parties use an arbitration organization that no longer exists.
“In determining the applicability of Section 5 of the FAA when an arbitrator is unavailable, courts have focused on whether the designation of the arbitrator was ‘integral’ to the arbitration provision or was merely an ancillary consideration.”[5] Where the designation of the arbitrator is in fact “integral” to the arbitration provision, the courts will not appoint an arbitrator and the parties will not be required to arbitrate.[6]
In this situation, the court could resolve the issue in a couple of ways. First, the court might decide to set alternative conditions for the selection of the arbitrator, such as expanding the geographical scope of the arbitrator’s required experience, or otherwise guide the parties on the selection of an arbitrator. The court acting in this manner is consistent with the “[t]he congressional purpose of the FAA [which] is to move the parties to an arbitral dispute out of court and into arbitration as quickly and easily as possible.”[7]
Alternatively, the court could determine that the qualifications contained in the HMA or FA for the arbitrator are an “integral” part of the agreement and that the court will not rewrite the parties’ contract.[8] In that case, the court could determine that the arbitration provision in the agreement is not binding and that the parties need not arbitrate.
In sum, parties should carefully consider the list of qualifications for the arbitrators to be selected to resolve any disputes. To the extent that the parties impose detailed and extensive requirements, the parties may also want to consider addressing the scenario in which a qualified arbitrator cannot be located or agreed upon. Otherwise, the parties will be left to address the issue with the courts, which has the possibility of resulting in the non-enforcement of the arbitration clause in its entirety.
[1] In re Salomon Inc. Shareholders’ Derivative Litig., 68 F.3d 554, 560 (2d Cir. 1995).
[2] Safety Nat. Cas. Corp. v. Certain Underwriters at Lloyd’s London, 2011 WL 3610411, *1 (M.D. La. Aug. 16, 2011) (citing Gulf Guaranty Life Insurance v. Connecticut General Life Insurance, 304 F.3d 476 (5th Cir. 2002)).
[3] See B/E Aerospace, Inc. v. Jet Aviation St. Louis, Inc., 2011 WL 2852857 (S.D.N.Y. July 1, 2011); Jefferson-Pilot Life Ins. Co. v. LeafRe Reinsurance Co., 2000 WL 1724661 (N.D. Ill. Nov. 20, 2000).
[4] See B/E Aerospace, Inc., 2011 WL 2852857.
[5] Khan v. Dell Inc., 669 F.3d 350, 354 (3d Cir. 2012).
[6] Id., at 357. See also Green v. U.S. Cash Advance Illinois, LLC, 724 F.3d 787, 792-93 (7th Cir. 2013).
[7] Moses H. Cone Memorial Hospital v. Mercury Construction Corp., 460 U.S. 1, 22 (1982). See Safety Nat. Cas. Corp., 2011 WL 3610411, *2 (ordering that “all umpire candidates possess the requisite experience in worker’s compensation reinsurance,” despite the fact that not all of the contracts at issue required such qualifications).
[8] Universal Reinsurance Corp. v. Allstate Insurance Co., 16 F.3d 125, 128 (7th Cir. 1994) (holding the parties to the letter of their arbitrator selection clause because “the parties themselves have dictated the outcome in this situation, and absent compelling circumstances, it is not our province to rewrite their agreement.”)
U.S. Hotels Faced Profitability Squeeze in 2024 Amid Rising Costs and Environmental Disruptions (a HotStats Profit Matters report)
KEY TAKE
Despite revenue growth, 2024 proved to be a challenging year for U.S. hotels, making it the only global market to experience a decline in Gross Operating Profit per Available Room (GOPPAR). Rising labor costs outpaced revenue growth every month of the year, squeezing margins across all segments of the brand scale. Midscale and economy hotels showed the greatest resilience, managing to achieve a positive flex despite a contraction in top-line revenue. However, for full-service and luxury properties, profitability pressures intensified as operating costs climbed amid revenue decelerations.
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