WASHINGTON, D.C.— In light of recent lawsuits, Marriott International met on Oct. 10 with the bulk of its hotel owners and franchisees that have large or multiple properties to explain how it charges those properties for its management services. Marriott said it began disclosing the information in an effort to be more communicative after several owners filed lawsuits against the giant hotel-management company, accusing it of mismanagement and racketeering, the Washington Post reported. The meetings began in the past few months, Marriott said. The company is facing four lawsuits that include allegations that the hotelier accepted kickbacks or rebates from vendors when ordering supplies and didnt properly disclose accounting charges for things such as customer-loyalty programs. Marriott has denied the allegations and has said the costs and fees are disclosed in management contracts with owners. The lawsuits have “heightened concerns and interests among a broad group of owners and franchisees,” Joyce said. The economic downturn and its accompanying slowdown in travel, especially business travel, has driven owners to put increasing pressure on managers to show where their money is being spent. In an Oct. 7 letter to owners and franchisees, William Shaw, Marriotts president and COO, and Stephen Joyce, evp of owner and franchise services, said that its “centralized business model is complex.” The company said it will create new Web-based software to give owners detailed accounting information. This is the first time, owners said, that they will have such access to bills and charges. Marriott said the software will be available early next year. In the information to owners, Marriott also explained the workings of Avendra LLC, a joint venture between Marriott and several other hotel companies that orders goods and supplies for hotels. In some of the lawsuits, Avendras operations have figured prominently and the company itself has been named as a co-defendant. Marriott said it owns “less than 50%” of Avendra and lost $1 million on the venture last year. Among its partners in the venture are Hyatt Hotels Corp. of Chicago, Six Continents PLC in London, Fairmont Hotels & Resorts Inc., and ClubCorp USA Inc. Last year, Avendra took in about $20 million in cash rebates for Marriott hotels. About $8 million of that went back to Marriott, which passed it on to owners, Joyce said. Avendra kept the rest for its expenses. SOURCE: Washington Post