Ripped From the Headlines: Law & Risk Review

Tyra W. Hilliard, PhD, JD, CMP@DrTyra

What did we expect? What did we get?

2013 Forecast v. Reality

2013 Expectations

Planners optimistic…» No decline in number of meeting» 46% expect larger budgets» 72% expect higher room rates» Shorter booking windows here to

stay

2013 Wants

Planners top 5:» Available meeting space»Willingness to negotiate» Price of space» Price of rooms» Service standards

2013 Seller’s Market

Room Rates, ADR UP» U.S. corporate – up 5.3%˃ NY 10.2% ˃ San Francisco 11%

» But some went down…˃ Washington D.C. Metro (0.7%)˃ New Jersey Shore (0.6%)

2013 Global Market

» Latin America – up 8-14%» Australia – 12%» Asia – 1.8%» Europe a mixed bag˃ Overall 1.1%˃ France 5.%%˃ London 3%

»Middle East down 1.1%

What Would You Do?

» Hurricane Sandy

» Boston Marathon Bombing

» Carnival Triumph

Over lunch, choose one or more of these and discuss how you hope you would (1) be prepared and (2) respond to each of these situations if it happened:

A. A week before a big meeting you were holding/hosting

B. The first day of the big meeting

C. The last day of the big meeting

Click icon to add pictureHurricane Sandy

Boston Marathon Bombing

Carnival TriumphCarnival Triumph

Nightclub Fire

Meteorite

Computer Crash

Norovirus

Travel Insurance

Resources

Force Majeure

The parties' performance under this agreement, in whole or in part, is subject to acts of God, war, government regulation, terrorism, disaster, strikes, civil disorder, curtailment of transportation facilities, or any other emergency beyond the parties' control, making it impossible, illegal, or commercially inadvisable, or which materially affects a party's ability to perform its obligations

Force Majeure Clause

The parties' performance under this agreement, in whole or in part, is subject to acts of God, war, government regulation, terrorism, disaster, strikes, civil disorder, curtailment of transportation facilities, or similar occurrences beyond the parties' control, making it impossible, illegal, or impracticable, or which materially affects a party's ability to perform its obligations…

Contracts don’t save lives, but they can save companies.

Contracts as Shields or Swords

Hotel Closed

» National Hotel in South Beach» July 24, 2013» Failed city fire inspections» Forced to close and dismiss its staff

Hotel Rebranding I

» Comfort Inn in Troutdale, Oregon» Sold and became a Holiday Inn express» Transient travelers were told their reservations

would not be honored

Hotel Rebranding II

» Ritz-Carlton Palm Beach ceased management July 1

» What if you had a contract with the hotel?» What if you only wanted a Ritz-Carlton?

Rebranding Clause

“In the event that the flag or brand of the hotel is changed, Hotel will notify Group within 10 days of becoming aware of this change. Group will then have 10 days to terminate the contract without liability if, in its sole discretion, it deems it necessary.”

Rebranding Clause

“In the event that the flag or brand of the hotel is changed, Hotel will notify Group in writing within 10 days of becoming aware of this change. Group will then have 10 days to terminate the contract without liability if, in its sole discretion, it deems it necessary to do so.”

Cancellations by Group

» Reed Exhibitions - Business Travel Market November 2013, London

» General Services Administration – 2013 GSA Training & Expo – May 14-16, Orlando

» Motivation Show – May 2014, Chicago

Union

» Vegas˃ July 2013 – Culinary and Bartenders unions picket the

Cosmopolitan

˃ June 2013 - Unions launch website for union information: http://www.vegastravelalert.org/

» Hyatt Hotels and UNITE HERE solidify contracts for Hyatt employees in LA, Chicago, San Francisco, and Honolulu through 2018.

» Others…?

Important Issues

» Can Hotel terminate contract due to its own union strikes?

» At what point in time can Group terminate contract if union workers are striking?

Surcharges

» Hotels - $1.95 billion» Airlines - $27 billion

» Consider contract language:

“Neither Group nor its attendees will be responsible for any surcharges or fees not enumerated in the contract (or approved by guest upon check-in.”

Caesar’s Solution

For better or worse…

What to Expect in 2014?

2014

State of the Industry

»Rates to increase, but by how much…?˃ Sellers forecast rates up by 6.5%-7.5%˃ Planners forecast rates up by 4-5%

»Basically…More of the Same

Government Shenanigans

» H.R. 313 Government Spending Accountability Act

» H.R. 2643 Stay in Place, Cut the Waste Act of 2013

» Sequestration ($85 billion spending cuts)

» Government Shutdown

» Travel expenditures under scrutiny

Food Allergies & Restrictions

» Lesley University, Cambridge, MA˃ Successful lawsuit requiring that the university

ensure that students with celiac and other food allergies can fully and equally enjoy the university’s meal plan.

Global Accessibility

» UNWTO Global Code of Ethics for Tourism˃ “Accessibility in tourism is a right and an ethical

obligation, but it is also an important business opportunity”

» Madrid, Spain˃ 6th Accessible Tourism Guide to Madrid˃ 161 hotels, 129 places of interest (including 7

conference and trade fair venues)

https://itunes.apple.com/us/app/aon-worldaware-hd-enterprise/id425089415?mt=8

Tyra W. Hilliard, PhD, JD, CMP@DrTyra

Thank you!