Class Action Claims Phila. Hilton, Valley Forge Sheraton Must Refund Deposits for Canceled Events Amid Pandemic

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The operator of a Philadelphia Hilton and Valley Forge Sheraton has unlawfully refused to refund deposits paid to the hotels for events that were canceled due to the COVID-19 pandemic and related restrictions in Pennsylvania, a proposed class action alleges.

According to the case out of the Philadelphia County Court of Common Pleas, a couple whose wedding had been scheduled at the Hilton Philadelphia City Avenue for September 2020 has been refused a refund by defendant Wurzak Hotel Group Mark, LLC, who also operates the Sheraton Valley Forge, despite having to move the event to an out-of-state venue with looser restrictions.

The suit says the restrictions in Philadelphia limiting the capacity for indoor events were not lifted until May 31, 2021, “more than eight (8) months after Plaintiffs’ original planned wedding date.”

Though the defendant’s special event contract states that the agreement may be terminated and deposits refunded if the hotel cancels an event “for reasons beyond its control,” including “government restrictions,” the contract “unjust[ly]” does not allow consumers to terminate the contract “for the very same reasons,” the lawsuit contests, comparing the agreement to a “Heads I win—tails you lose” arrangement.

“The Defendant in this case presumably has taken the position that it may indefinitely postpone a celebration or business event which the customer may no longer want to host while not ‘terminating’ the Agreement and therefore is not obligated to return the money,” the complaint reads.

By refusing to refund fees and deposits for canceled events, the defendant has unlawfully profited at the expense of consumers, the lawsuit alleges.

The plaintiffs, according to the case, entered into a contract with the defendant to hold their wedding reception at the Hilton Philadelphia City Avenue on September 9, 2020. Per the case, the banquet event order contract, which was signed in September 2018, provided for the plaintiffs to occupy five of the hotel’s ballrooms for a minimum of 175 guests. The plaintiffs claim to have paid a total of $10,000 in deposits for the event.

According to the case, restrictions placed on large social gatherings in Philadelphia County due to the COVID-19 pandemic were still in place as of July 17, 2020, at which time the plaintiffs say they requested and were refused a refund of their deposits and fees. Hilton’s director of catering/food & beverage operations allegedly refused the refund, remaining “hopeful” that Philadelphia would transition to the “green phase” and allow indoor gatherings of up to 250 people by September 2020.

Per the suit, the plaintiffs were told there were no refunds and that they could reschedule their event for another date after restrictions were lifted.

Although the plaintiffs ultimately held their wedding at another venue in Delaware, where the restrictions on indoor gatherings were loosened at the beginning of September 2020, restrictions in Philadelphia were not lifted until late May 2021, the case relays.

The suit argues that although the defendant’s management indicated to the plaintiffs that no refunds were available, their event contract states that the hotel operator may terminate the contract and refund any deposits if it is unable to hold up its obligations due to “any reasons beyond its control, including . . . government requisitions, [or] restrictions or regulations on travel.”

Per the case, the defendant’s contracts are “partial and not equitable” given they provide the defendant with the “unilateral option” to return deposits in the event that the hotel operator is unable to fulfill its obligation while denying the other parties that same option. It is “inequitable and unconscionable” for the defendant to retain consumers’ deposits and expect them to postpone their events while maintaining the exclusive right to terminate their contracts, the lawsuit contends.

“On occasion, Plaintiffs, Class members and others do and did have to move on with their lives and businesses do and did have to cancel their special events at some point,” the complaint argues. “This is not uncommon even in non-pandemic times. These individuals and entities cannot be required to indefinitely postpone or rescheduled [sic] these events.”

The lawsuit looks to cover anyone who entered into a “Banquet Event Order Contract” or similar special event contract at the Hilton Philadelphia City Avenue or Sheraton Valley Forge and paid deposits or made payments on account for an event booked on or before March 6, 2020 and who requested and was denied a refund of their payments before Governor Tom Wolf’s proclamation of disaster emergency was lifted.

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