A prolonged legal battle claims major online travel firms underpaid Nevada hotel room taxes by millions. The case returned to Clark County District Court, where lawyers debated the extent of evidence plaintiffs can seek under the state’s False Claims Act.
Procedural Hearing on Discovery Motion
Judge Mark Denton heard arguments on a motion to compel discovery responses from companies such as Expedia, Orbitz, Travelocity, Priceline, and Hotels.com. He took the matter under submission without issuing a ruling. A trial is set for 2027.
The lawsuit, initiated in 2020 by communications consultants Sig Rogich and Mark Fierro representing the state, accuses the firms of charging customers taxes on retail room rates while remitting taxes to Nevada based on lower wholesale rates. Plaintiffs allege the companies pocketed the difference.
Key Arguments from Both Sides
Plaintiffs’ attorney Dominic Gentile maintains the False Claims Act imposes liability when a party knowingly submits false or incomplete information to the government, even indirectly. He argues the defense wrongly narrows the case by confusing liability theories with the core statutory claim.
Defense lawyers contend plaintiffs seek to broaden the lawsuit beyond authorized limits and initial disclosures to the Nevada Attorney General. They insist discovery should cover only the relevant period starting around 2015, excluding older or out-of-state documents.
A major dispute centers on accessing ‘discovery sharing’ materials from similar lawsuits in other states. Plaintiffs say these documents reveal national transaction structures and their impact on Nevada tax payments. The defense counters that such materials lack direct relevance and would create excessive collection burdens.
High Stakes for State Revenue
Plaintiffs estimate the dispute involves over $1 billion in contested tax revenue. These funds support key programs like education, tourism promotion via the Las Vegas Convention and Visitors Authority, and various public services.
