Expedia v. Columbus in Hands of Supreme Court

By Zaneta Lowe  - bio | e-mail

COLUMBUS, GA (WTVM) - If you log onto expedia.com to try to book a hotel room in Columbus, the site will only show rooms available in Phenix City.

That's been the case for months as the online travel giant continues a legal battle with Columbus.

On Tuesday, the two sides continued the fight in front of Georgia's highest court.

"This is a money claim, they want money."

Those are the words that E. Kendrick Smith, an attorney for Expedia shouted in the hearing in front of the Georgia Supreme Court.

"The only reason why Expedia is being used is they're big and they're out of state, this is not a new way of doing business," added Smith in his argument to the justices.

But attorneys representing the city of Columbus say it's the wrong way of doing business.

That's why they sued the online travel giant in 2006.  They say when Expedia acts as a "go between" with hotels and consumers, it's collecting tax dollars but not handing the proper amount back over to the city.

The case hasn't even made it to trial, but a permanent injunction stopped the practice.

And that's what lawyers from Expedia want the Georgia Supreme Court to reverse.

"That's what's before this court, is an injunction, wholly inappropriate, wholly unauthorized by law," says Smith.

The case was first up in Tuesday's special session of the court at John Marshall Law School in Atlanta.

And similar to debate in Superior Court, justices asked several questions of both sides to get to the bottom of the issue.

"Expedia, the court below found was actually collecting the tax and as a tax collector, had the obligation to lawfully collect the tax and collect it in the lawful amount and have it somehow transferred to the hotel and to the hands of the taxing authority," explained Bill Norwood, an attorney representing the city of Columbus during his argument.

If justices decide to uphold the lower court ruling, attorneys say it not only affects Columbus, but sets a precedent for the rest of the country.

"It would be applicable all over the state of Georgia both for sales taxes and all the municipal and county taxes, and it would have application all over the country as to any statute that is like ours," says Neal Pope, another attorney with the firm representing Columbus against Expedia.

No decision has come from Tuesday's hearing.