Las Vegas Resorts Defeat Hotel Price-Fixing Lawsuit in US Appeals Court

Caesars Entertainment, Wynn Resorts, and Treasure Island have scored a major legal victory, as the Ninth Circuit Court of Appeals has upheld the dismissal of a class action lawsuit accusing them of conspiring to inflate hotel room prices through the use of shared software.

The ruling delivers a decisive win for the three defendants and other Las Vegas Strip operators. It could protect them against potentially substantial antitrust damage at a time when visitor numbers are dropping.

Judges Reject Collusion Theory

The case centered on Cendyn’s revenue-management software, which is widely used across the Las Vegas Strip.

The plaintiffs alleged that rival casinos had colluded to overcharge guests by feeding sensitive pricing and occupancy data into the platform, which provides price recommendations. That effectively aligned their room rates, undermining competition.

They appealed after a judge dismissed the lawsuit in May 2024. In the ruling, Chief US District Judge Miranda Du ruled that the defendants were not bound to follow the price suggestions.

The 9th Circuit three-judge panel upheld the decision. It ruled that the plaintiffs did not provide evidence that there was an agreement between the casinos to follow Cendyn’s pricing recommendations. Antitrust law requires proof of a “meeting of the minds” to confirm collusion.

Additionally, the court stated that the defendants’ independent use of the same software did not restrain their abilities to rent hotel rooms.

“Rather than eliminating competition, pricing one’s hotel rooms in a manner calculated to maximize profits is how one competes,” wrote Circuit Judge Carlos Bea, joined by Circuit Judge Ana de Alba and US District Court Judge Jeffrey Brown.

The panel emphasized that each company had the final say over its rates, even if the software’s recommendations yielded a similar outcome.

Atlantic City Case Shows Legal Pattern

The ruling echoes a decision made in October 2024 in New Jersey. A federal judge dismissed a nearly identical lawsuit against casino hotels in Atlantic City, also connected to Cendyn’s software.

In this case, plaintiffs also argued that the shared use of the algorithm led to coordinated rate increases. However, the court found no proof of collusion.

Together, the cases establish a judicial pattern: the use of algorithmic pricing software alone is not enough for antitrust claims, without direct evidence of coordination.

Vegas Resorts Slashing Prices Amid Tourism Slump

Ironically, the allegations of inflated room rates come at a time when Las Vegas hotels face a problem of too many empty rooms.

Las Vegas Convention & Visitors Authority reports that visitor volume fell 11.3% year-over-year in June 2025. Occupancy fell 6.5% compared to June 2024, while average daily hotel rates dropped 6.6% to $163.64.

Service workers have been hit, too. Some say tips have fallen by more than 50%.

Caesars Entertainment CEO Tom Reeg has been unable to pinpoint the reason for the drop. He said that it’s the “kind of normal seasonality that we haven’t seen in a while.”

Meanwhile, Boyd Gaming CEO Keith Smith noted the decrease in room rates during the company’s recent earnings call. Despite that, he stressed that the company is “not going to offer $19 hotel rooms.”

Still, Smith said there are signs of “continued strength in the local economy.” He referred to the strong employment trends in Southern Nevada. Additionally, construction activity worth nearly $11 billion is underway in the Las Vegas Valley.

Some operators are enjoying good fortune. Stephen Cootey, executive vice president, CFO & treasurer at Red Rock Resorts, said that Q2 2025 was “easily the best quarter in our company’s history.”

Others, such as Golden Gate Hotel & Casino in downtown Las Vegas, are not waiting for visitors to return. Instead, they’re shifting strategies to align with consumer demands.

The casino recently announced it will replace all of its live dealer tables with electronic gaming machines. The latter allows faster gameplay and takes less space. That enables the casino to deploy more machines in the same square footage.