The Law & The Planner
Keeping 'Attendee Rustlers' at Bay
How to identify and avoid fraudulent housing services
by Jonathan T. Howe, Esq.January 1, 2013
Jonathan T. Howe, Esq.
A senior partner of the Chicago, St. Louis and Washington, D.C., law firm of Howe & Hutton Ltd., specializing in meetings and hospitality law. E-mail questions to him at meetings-
Takeaways • The moment you learn a pirate company is trying to steal attendees away from your room block, communicate with all potential participants to warn them of the interloper.
• Not only should your contract state that you will be credited for rooms booked outside your block, but it should also say that you will get credit for any outside catering that can be linked back to your event and offset your F&B requirements.
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One issue that often plagues meeting professionals is fulfilling room block requirements. Challenges can arise not because people aren't attending events, but because they have been rustled away by nefarious organizations that grab your participants' bookings and keep them out of the block.
Pure Fraud Several years ago, a spurt of incidents occurred in which attendees were contacted by organizations claiming to be the official housing bureau for an event or to have the best rates for hotels in the block. This problem is popping up again.
We recently learned about an exhibitor at a major citywide program who thought he had bought hotel rooms at a substantially reduced rate and found upon arrival that no reservation existed. What's more, to get those outrageously low rates, he had been required to make full payment in advance.
Now, a red flag should have gone up when the exhibitor was asked to pay immediately by check or credit card. This is a sneaky detail: The time frame was at least 90 days before the event, meaning the check already would have cleared or a credit card charge probably would have been paid before the exhibitor discovered that the hotel had no record of the reservation. And challenging that charge would result in a flat denial at worst or an extended controversy at best.
So how do you help your attendees avoid the rustlers? Let them know early and often who the official housing agency is, and warn them in capital letters to be wary of any other organizations claiming to be in charge of hotel reservations or saying they can offer a better deal. Alerting the host hotel and all potential attendees of the existence of a pirate helps cut them off at the pass.
If the meeting host's intellectual property -- such as a trade name or trademark -- is used without authorization to mislead potential attendees, additional legal remedies are available. We have gone after interlopers for infringing on the meeting and the host in this manner. When a registered trademark is involved, sometimes you can recover court costs in addition to an injunction and damages.
Not So Shady Sometimes the hotel is the rustler, going after your exhibitors, sponsors or attendees who might require catering and/or a large number of rooms. Special deals are offered, cutting out the meeting host.
Protect yourself in your contract with the hotel by spelling out how your organization will get credit for any such bookings, including credit for any catering (such as sponsors or exhibitors who book a hospitality suite and order refreshments) so it will count toward your F&B requirements.
Get It In Writing By whatever means rooms are booked outside your block, your contract must state that you will be credited for them, and your bookkeeping should be thorough enough to prove the attendees were part of your block. This helps to maintain the integrity of your room block and rate, minimizing the incentive for the hotel to go after your group on its own and helping you avoid attrition fees.