WEST PALM BEACH, FLORIDA A U.S. bankruptcy court has sided with Innkeepers USA Trust, which sought to bar Best Western International from stripping Best Western West Palm Beach Airport Inn of its flag.
Innkeepers, the Palm Beach, Florida-based hotel REIT that owns the 135-key hotel, filed for bankruptcy in July. Innkeepers argued that losing the Best Western flag would harm its ability to reorganize. Best Western says the hotel is not in compliance with brand standards, including lobby size and exercise facilities, and sought to eliminate the property from its system.
But New York City-based Judge Shelley Chapman ruled that ending the membership agreement would result in Innkeepers being in default on its loans. “I believe the debtors are entitled to more time to determine what they want to do with this agreement,” Chapman said, Bloomberg reports.
Best Western attorneys were dismayed with the ruling, arguing that the property’s failure to meet brand standards damages Best Western’s reputation with guests. “This hotel is in the bottom scores of customer satisfaction. It’s flying a Best Western flag, but it’s not what customers expect,” Best Western lawyer Michael Helms told Chapman.