Ontario Superior Court rejects class action lawsuit against online travel giants

They were sued for advertisements that mislead consumers to make premature booking decisions

Ontario Superior Court rejects class action lawsuit against online travel giants

The Ontario Superior Court of Justice has ruled against a group of plaintiffs, comprising mainly police officers, who appealed a decision that sought class action certification against leading figures in the online accommodation booking sector.

The defendants in the case include Expedia Group, Booking Holdings Inc., Booking.Com B.V., and Trivago. The plaintiffs accused these companies of engaging in deceptive advertising practices and violating consumer protection laws.

In their legal challenge, the plaintiffs argued that the defendants' advertising tactics misled consumers, leading them to make premature booking decisions, and inflicted economic damage on the broader marketplace. They did not, however, claim compensatory damages for individual losses, focusing instead on disgorgement, nominal damages, and punitive damages as potential remedies.

Echoing the initial judgment, the Superior Court upheld the motion judge's decision, effectively dismissing the appeal. The court concurred that the remedies sought by the plaintiffs—disgorgement, nominal damages, and punitive damages—do not align with the provisions of consumer protection statutes applicable to the case. The court pointed out a critical flaw in the plaintiffs' arguments—the absence of a direct link between any harm suffered due to the defendants' actions and the agreements entered into by consumers, a connection necessary for invoking remedies under s. 18(2) of the Consumer Protection Act.

The court also scrutinized the plaintiffs' plea for punitive damages, underscoring the insufficiency of alleging mere statutory breaches to warrant such an award. Without evidence of conduct that is malicious, oppressive, or significantly deviates from accepted standards of decency, the court found no basis for punitive damages. Furthermore, the court noted the plaintiffs' failure to demonstrate any compensatory harm that would justify class action certification, underscoring the absence of individual losses and challenging the pursuit of punitive damages as an isolated remedy.

In its decision, the court reinforced the stringent criteria for class action certification. It limited the scope of remedies available under consumer protection legislation, particularly in cases alleging unfair practices by online service providers.

The court also highlighted the judiciary's cautious stance on awarding disgorgement and punitive damages, emphasizing that such remedies are reserved for instances of egregious misconduct and where a clear causal relationship between the defendant's actions and the plaintiff's harm is evident. Ultimately, the court dismissed the appeal and clarified the legal landscape for consumer protection, digital advertising practices, and the prerequisites for class action lawsuits.

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