Starwood Hotels & Resorts Worldwide filed a lawsuit earlier this month against Jack Parker Corp., alleging fraudulent loyalty program reimbursement payments.
Starwood Hotels & Resorts Worldwide, Stamford, Connecticut, is seeking to terminate its licensing agreement with Jack Parker Corp. for the 144-room Parker Palm Springs, located in Palm Springs, California, and the 730-room Le Parker Méridien New York, located in New York City, both of which Jack Parker Corp. operates.
In the lawsuit Starwood alleges that Jack Parker Corp. implemented a policy in which fake guests were checked in under the Starwood Preferred Guest loyalty program to receive reimbursements from Starwood totaling US$1 million over the course of three years.
“Starwood seeks to avoid litigation, but the egregiousness of the conduct left us no choice but to take this strong action. Under the direction of high-ranking employees and executives of Parker, hotel employees at Le Parker Méridien New York and Le Parker Méridien Palm Springs engaged in a wide-ranging and long-term fraudulent scheme to inflate occupancy and improperly obtain unearned payments from the Starwood Preferred Guest program totaling over US$1 million. By this action, Starwood is seeking to terminate its license agreements with Parker for these two hotels,” Starwood said in a statement emailed to HOTELS.
Jack Parker Corp., New York City, is not commenting on the open litigation.