The City of Atlanta’s lawsuit against Hotels.com and other online travel companies is being sent back to the trial court under a ruling by the Georgia Supreme Court. In a 5-to-2 decision, the high court has thrown out an opinion by the Georgia Court of Appeals and remanded the case with instructions. In 2006, the City sued 17 online companies, which also included Expedia, Travelocity and Orbitz. The City claimed that as sellers of Atlanta hotel rooms, the companies operate as hotels and therefore must collect hotel and occupancy tax from their customers and pay it to the City. The companies moved to dismiss the lawsuit, arguing that the City rushed into court before exhausting certain administrative remedies, as required by state and city laws. The Fulton County trial court agreed and dismissed the City’s complaint, based on the “doctrine of exhaustion.” The Georgia Court of Appeals affirmed the trial court’s dismissal.
But in today’s majority decision, written by Presiding Justice Carol Hunstein, the high court has sent the case back to the Court of Appeals and ordered it to direct the trial court to decide whether the companies are subject to the hotel occupancy tax.
Monday, March 23, 2009
Georgia Supreme Court: Hotels.com, others might have to pay sales tax
From the Georgia Supreme Court's opinion's summary: