Pryor Cashman Represents Vornado in $30M Suit Against InterContinental Hotels
Pryor Cashman is representing Vornado Realty Trust, an owner of the Crowne Plaza Times Square, in a $30 million breach of contract suit against Holiday Hospitality, the franchising arm of InterContinental Hotels Group.
At issue in this action, commenced on July 5, 2016, is Holiday’s failure to perform its obligations under its licensing agreement with Vornado; namely its duty to “enhance the public image and reputation [of the hotel]” as an upscale accommodation. The complaint points to “woeful” marketing efforts and the “alarming underperformance” of the hotel brand as the basis for damages, noting that the Crowne Plaza was the only Holiday brand to see a net loss in rooms globally in 2015.
Expounding the damages borne by Vornado, the complaint stated, “rather than promoting and supporting its owner's hotel, the Crowne Plaza brand is an albatross around the neck of the business - dragging with it the property owner's half-billion dollar investment and its profitability. Because owners recognize the detriment of affiliation with the Crowne Plaza brand, there is an anemic pipeline of Crowne Plaza branded hotels in the United States."
Holiday was notified by Vornado in May 2016 that its failure to meet its obligations was tantamount to a breach of the licensing agreement, and a 40-day deadline was established to begin rectifying the problems. However, when none of the requested improvements were made within that period, Vornado informed Holiday it would terminate the agreement.
Partner Todd Soloway, Chair of Pryor Cashman’s Real Estate Litigation and Hotel + Hospitality Groups, leads the representation of Vornado, along with associate Bryan Mohler.
Additional reports of this lawsuit were published by The Real Deal and Hotel Management.
