Hotel That Charged Guest $350 For A Negative Review Now Facing A Lawsuit From State Attorney General

from the when-has-this-EVER-worked? dept

The American Dream: own your own business... be your own boss... run your reputation into the ground... charge people's credit cards $350 for negative reviews... get sued by the government. Welcome to Nashville, Indiana, home of the Abbey Inn, whose absentee ownership, lack of on-duty staff, and hidden clauses have led to a precipitous decline in brand health, along with the opportunity to defend itself against a lawsuit brought by the state's attorney general.

It all started with hotel guest Katrina Walker's disastrous stay at the Abbey Inn.

The hotel room wasn’t just dirty. It was “a nightmare,” the guest said.

The air smelled like sewage. Hair and dirt covered the bed sheets, as if the linens hadn’t been cleaned after the last guests had left the Abbey Inn & Suites room that Katrina Arthur and her husband were renting in Nashville, Ind in March 2016. The air conditioner and shower in the room didn’t work right, either, Arthur told WRTV.

“We were just wanting to get away and have some alone time,” Arthur told the TV station. “It looked really pretty on the website.”

Walker left a negative review of Abbey Inn after an email from the hotel asked her to submit a review. This was followed by a (bogus) legal threat from someone who should definitely know better.

Attorney Andrew Szakaly, who owns the hotel, wrote a letter to Arthur on April 2, 2016 telling Arthur that her negative review included “false statements” that had caused “irreparable injury” to his business, according to Indiana’s attorney general.

If Arthur didn’t take down the negative review, Szakaly threatened to file a libel lawsuit against her, according to the attorney general’s office.

Andrew Szakaly isn't just an attorney and the now-former owner of the Abbey Inn. At the point this legal threat occurred, Szakaly was also the attorney for the town of Nashville. At this point, he's moved on to become the county's chief deputy prosecutor. He's also not willing to answer questions about the problems at Abbey Inn that occurred while he owned the business. He's also nuked his own site, which had his phone number and email address. But it lives on at the Internet Archive, even if calls and emails are going unanswered.

He will likely have to provide some answers. After sending out the bogus legal threat, Szakaly billed Walker $350 for the negative review, citing a clause in Abbey Inn's guest policy. Walker claims she never saw anything in the copy of the guest policy she received at the hotel. The clause also isn't posted anywhere in the business where guests can view it. It can be found in archived snapshots of the Inn's website -- which has also been nuked following negative press coverage.

Now, Indiana's state attorney general is taking the business to court. The complaint [PDF] (h/t Cyrus Farivar) lists dozens of things the Abbey Inn did wrong, on top of the $350 charge for "disparaging" an already-questionable hotel.

Abbey Inn Suites maintains an overnight phone number for times when an employee is not available on-site to address consumer issues, but signs in each guest room state a consumer must not call overnight phone number unless there is an emergency. The signs further state if a consumer calls the overnight phone number and there was not an emergency, Abbey Inn Suites will charge the consumer in the amount of $100.00.

[...]

During her stay, Ms. Arthur, experienced issues with a sewage smell in her room, issues with water pressure, problems with the air conditioner, and an unkempt room.

Ms. Arthur attempted to notify Abbey Inn Suites management of the issues, but there was no employee on site and her calls to the after-hours phone number went unanswered.

There was no employee at the front desk when Ms. Arthur checked out on March 13, 2016, to whom she could direct a complaint about the issues encountered during her stay.

This last part is especially important because it gives guests no other option but to "violate" the bogus clause in the guest policies that they never see [emphasis added]:

Guests agree that if guests find any problems with our accommodations and fail to provide us the opportunity to address those problems while the guest is with us, and/or refuses our exclusive remedy, but then disparages us in any public manner, we will then be entitled to charge their credit card an additional $350 damage. Should guest refuse to retract any such public statements legal action may be pursued.

The lack of staff makes it all but impossible for issues to be resolved before the guest leaves.

The attorney general accuses the business of violating state deceptive practices laws with its non-disparagement clause. The office seeks an injunction and fines of $5,000 per violation. As the complaint points out, the guest policy went far beyond discouraging negative reviews. It also prevented consumers from bringing grievances against the Inn.

The Policy also forces consumers to accept the Defendant's final and binding "exclusive remedy" to resolve any situation or issue, regardless of what that remedy entails and whether it actually resolves the situation or issue to the consumer's satisfaction.

[...]

The Policy not only attempted to limit negative online reviews, thus improperly shielding the Defendant from the consequences of providing consumers with a negative experience or unsatisfactory customer service during their stay, but would also prohibit a consumer from filing a consumer complaint with the Attorney General or Better Business Bureau, filing a lawsuit, or even a police report, as all could be considered a "disparagement"
in a "public manner."

The Abbey Inn's reputation is now destroyed, thanks to a clause inserted by the attorney/owner who also happens to hold a government job as a prosecutor. Hopefully, this all lands in the lap of Brown County Chief Deputy Prosecutor Andrew Szakaly.


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  • icon
    Ninja (profile), 27 Dec 2017 @ 5:08am

    It's good to see it happening. I do hope he goes bankrupt because of his shenanigans. You know, to discourage future wannabe-smartasses.

    reply to this | link to this | view in chronology ]

    • icon
      Stephen T. Stone (profile), 27 Dec 2017 @ 6:02am

      Re:

      Nothing discourages wannabe smartasses. Just look at the average comments section on this site. (Or my own post history, for that matter!)

      reply to this | link to this | view in chronology ]

    • icon
      Eldakka (profile), 28 Dec 2017 @ 7:46pm

      Re:

      Unfortunately, according to the article, Szakaly no longer owns the business. If the business was sold/transferred in its entirety (as the articles imply) then the new owners are the ones who face the possibility of bankruptcy, not Szakaly himself.

      When a business is transferred to a new owner, the new owner takes on all responsibilities for any existing assets and liabilities - financial, legal - of the business.

      reply to this | link to this | view in chronology ]

      • icon
        rkhalloran (profile), 2 Jan 2018 @ 12:19pm

        Re: Re:

        The new owners are Szakaly's daughter/son-in-law... I would guess this is a move to avoid the blowback from the bad publicity around this case while keeping the property "in the family".

        reply to this | link to this | view in chronology ]

  • identicon
    PMW, 27 Dec 2017 @ 6:15am

    Basic Contract Law

    .. this is an unusual but simple contract-law issue that any competent civil judge could quickly resolve. The hotel has no valid claim of "Breach of Contract" because the guest did not understand or accept that specific, obscure clause at issue.

    When a party files a lawsuit claiming a breach of contract, the first question the judge must answer is whether a contract existed between the parties. The complaining party must prove four elements to show that a contract existed:

    1. Offer - One of the parties made a promise to do or refrain from doing some specified action(s) in the future.

    2. Consideration - Something of value was promised in exchange for the specified action or nonaction. Consideration is the value that induces the parties to enter into the contract.


    3. Acceptance - The offer was accepted unambiguously. Acceptance may be expressed through words, deeds or performance as called for in the contract.

    4. Mutuality - The contracting parties had “a meeting of the minds” regarding the agreement. This means the parties understood and agreed to the basic substance and terms of the contract.

    ....When the intention of the parties is unclear, courts look to any custom and usage in a particular business and in a particular locale that might help determine the intention. For oral contracts, courts may determine the intention of the parties by considering the circumstances of the contract’s formation, as well as the course of dealing between the parties. The specific clause at issue here was extremely unusual in the hotel business and a judge would find that any typical hotel guest would be unaware of it... and not contractually bound by it.

    reply to this | link to this | view in chronology ]

    • icon
      That Anonymous Coward (profile), 27 Dec 2017 @ 6:26am

      Re: Basic Contract Law

      Except several states and the FTC say that language is illegal to begin with after the other stories of shitty businesses using these threats & demanding payment from customers for less than glowing reviews.

      reply to this | link to this | view in chronology ]

    • icon
      Roger Strong (profile), 27 Dec 2017 @ 6:54am

      Re: Basic Contract Law

      .. this is an unusual but simple contract-law issue that any competent civil judge could quickly resolve. The hotel has no valid claim of "Breach of Contract" because the guest did not understand or accept that specific, obscure clause at issue.

      So would any competent civil judge invalidate a shrink-wrap license? The kind you're presented with AFTER the deal is made, AFTER you've opened the software or inkjet cartridge packaging and it's too late to return it?

      Just curious. I never seem to find a definitive answer on that.

      reply to this | link to this | view in chronology ]

      • identicon
        PMW, 27 Dec 2017 @ 7:29am

        Re: Re: Basic Contract Law

        Yes

        If a party to a contract does not have the voluntary oppotunity to unambiguously understand and accept the full terms of a contract offer -- then no valid contract exists and no breach of contract is possible.

        If a retail seller of software (or candy bars or toothpaste) chooses to sell his goods without any valid contract with buyers -- then the only legal requirement upon buyers is to pay the seller's asking price.


        ( the question of competent/honest judges is an entirely different issue)

        reply to this | link to this | view in chronology ]

    • icon
      Dan (profile), 27 Dec 2017 @ 7:00am

      Re: Basic Contract Law

      Well, no, it isn't a matter of contract law at all. The customer's issue with the hotel could be (ignoring any other governing consumer protection statutes), but the customer isn't a party to this case. The state is bringing this case, claiming (correctly, I believe) that its consumer protection statutes have been violated.

      If there were a contract action, I think the hotel would lose, but not for the reason you state. Courts don't really look at whether both parties actually understood all the terms of a contract (how many people read all the fine print on everything they sign?). Rather, that provision would likely be thrown out as unconscionable.

      reply to this | link to this | view in chronology ]

      • identicon
        PMW, 27 Dec 2017 @ 7:45am

        Re: Re: Basic Contract Law

        No, the original action by the hotel against the guest was a threat of breach-of-contract. That is a CONTRACT LAW case.

        That a 3rd party government bureaucrat chose to inject himself into the controversy ... does not alter the fundamental nature of the contract legal case.

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 27 Dec 2017 @ 8:23am

          Re: Re: Re: Basic Contract Law

          That "3rd party government bureaucrat" did exactly his JOB! Protecting consumers from shady business practices. When a contract violates state laws, it's up to the state to intercede. WTF do you think consumer protections laws are there for?

          reply to this | link to this | view in chronology ]

  • icon
    That Anonymous Coward (profile), 27 Dec 2017 @ 6:31am

    IIRC the hotel had gone into the but we sold to new owners who were trying to make improvements but the evil internet is calling in death threats and upsetting her. With her being the former owner/lawyers daughter.

    I still think the AG should find out who they used for CC processing & look for other $350 charges. To get to the point where it smells like an open air sewer, the water isn't working, the ac is busted, & no one bothered to change the linens... requires all kinds of not giving a shit for a while. So I'd be curious how many other people he bullied into removing complaints & dinged for $350.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 27 Dec 2017 @ 7:15am

    I'd also be curious....

    to see how long the city continues to employ him after this.

    Not only has he completely torpedoed the reputation of the hotel he no longer owns, but his own professional reputation.

    Any official work he does for the city will now be viewed through this prism and his competence will be completely thrown into question.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 27 Dec 2017 @ 8:22am

      Re: I'd also be curious....

      His competence rightly should be called into question.

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 27 Dec 2017 @ 9:00am

      Re: I'd also be curious....

      What you need to understand is that cushy, "important" jobs are never, ever held on the basis of any sort of competence, but based on who are you how good a "friend" with. That does not change due to incidents like this - unless the incident is publicized and negative enough to make said person a liability to his "friends". One can only hope that is the case here, but chances are that's not so and nothing changes.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 27 Dec 2017 @ 3:51pm

    The office seeks an injunction and fines of $5,000 per violation.

    Can we please apply MAFIAA pricing to that fine, so it's more like $150,000 per violation instead?

    reply to this | link to this | view in chronology ]


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