Nebraska Attorney General Doug Peterson has filed a lawsuit against Hilton, one of the largest hotel chains in the world, accusing it of deceptive business practices, after what he said was a nationwide investigation involving the attorneys general of all 50 states and Washington, D.C.
Peterson said Hilton engaged in "drip pricing," a practice in which hotels hide part of the nightly rate from consumers by burying it in the fine print later in the booking process. This allegedly allowed Hilton to list its rooms at artificially low rates, Peterson said in his lawsuit, making it harder for consumers to accurately compare the prices of hotel rooms.
"For years, Hilton has misled consumers in Nebraska regarding the true cost of certain Hilton hotel rooms," he said in a press release issued Tuesday. "They failed to heed warnings from the Federal Trade Commission and the mounting complaints from their own customers."
The lawsuit says the FTC warned the hotel industry in Nov. 2012 that drip pricing — not listing additional fees along with the base price of a room — may violate federal consumer protection law. It also says that Hilton was aware of the warning but continued to hide its fees.
A Hilton spokesperson said the company only has resort fees at a select few of its hotels, and that customers are made aware of the charges.
"Resort fees are charged at less than two percent of our properties globally, enable additional value for our guests, and are always fully disclosed when booking through Hilton channels. We have not yet been served the related documents, so will take the opportunity to review these before providing additional comment," the spokesperson said.
Peterson seeks to force Hilton to display all prices for its rooms upfront, pay restitution to customers it allegedly mislead, and pay fines to the government. According to Peterson's press release, Hilton charges hidden fees at 78 properties in the U.S. with fees between $15 and $45 per night. Hilton has about 5,700 hotels worldwide.
The lawsuit says hundreds of Nebraska residents paid hidden resort fees to Hilton since 2012.
Fox News' Tyler Olson contributed to this report.