Remember Barbara Smidt? She purchased a Cancun vacation package on Cyber Monday through Fresh Trips, a website promoted by Travelzoo. After she paid for her trip, she discovered that Fresh Trips was not delivering on the deal — and she would have to find other, much more expensive accommodations to complete the trip.
There’s both good and bad news to report. And a whole lot of moving parts.
Let’s start with the bad: Smidt hasn’t seen a dime of her money yet. She has opened a dispute with her credit card company, and with any luck, they’ll see what happened here (or rather what didn’t happen) and issue a permanent credit to her account for the money paid to Fresh Trips.
And now on to the good news: Smidt had a great trip to Cancun, where she stayed at the Royal Sands. Of course, she paid traditional rates for the all-inclusive stay, and on top of what she had already paid to Fresh Trips. But she enjoyed her vacation.
Now there’s nothing like a good lawsuit between two businesses to shine a flashlight on the cockroaches and watch them scatter. On Feb. 26, Travelzoo filed a lawsuit against Fresh Trips and its principal officers in New York state court, confirming in a very public way its displeasure over the handling of the Cyber Monday deal gone bad.
The Travelzoo lawsuit makes eight claims and seeks more than $600,000 in damages, primarily for breach of contract, trademark infringement and damage to its reputation. Notably, Travelzoo’s complaint says that, “To date, Travelzoo has received zero compensation for publishing the promotion.”
Additionally, Travelzoo asserts that it, not Fresh Trips, “worked around-the-clock and went to extraordinary lengths attempting to address the concerns of its customers.”
Travelzoo further states that the actions and omissions of Fresh Trips have resulted in substantial costs and reputational damage to Travelzoo. It specifically claims Fresh Trips ignored its requests to remove its name from the Fresh Trips website, instead calling the two companies “partners.”
Travelzoo didn’t much care for Fresh Trips’ “false assurances” to customers, specifically citing some of the bizarre statements we highlighted in our own coverage of the case:
As several affected travelers were voicing concerns on third-party websites and social media, Fresh Trips continued to falsely reassure travelers that their concerns would be satisfied, which made things worse. For example, Fresh Trips created a separate tab on its webpage publicly pronouncing:
Despite what you’ve read on TripAdvisor and other social media – OUR COMPANY IS VERY REAL and there’s no scam here!
Please be patient with us and we will ensure you are 100% taken care of – thank you!
Fresh Trips also issued a press release apologizing for the “mistake” that they had made with the Royal Resorts, which is located https://fresh-trips.com/formal-apology-royalresorts/.
Fresh Trips again falsely reassured customers that “everyone who booked through them will be taken care of and compensated if displaced or moved.” According to Fresh Trips’ public pronouncements: “We also want to reassure all guests who booked through us that they will be accommodated to their satisfaction.” Defendant Fresh Trips’ apology is attached as Exhibit C.
As it turned out, however, Fresh Trips was not taking care of the travelers or compensating them for its “mistake.” Instead, while Fresh Trips was making such representations publicly to perpetuate its scheme, it was Travelzoo who was working around the clock to respond to concerned consumers who did not receive booking confirmations and who did not receive any compensation from Fresh Trips or any of the other Defendants.
Our review of Smidt’s case is consistent with Travelzoo’s complaint: Fresh Trips advertised a deal, accepted money from customers, failed to deliver on the deal and then took steps to falsely assure customers they would be handled in turn. In that respect, both Travelzoo and customers have potential claims against Fresh Trips.
It also appears that Travelzoo was trying, desperately, to help the real victims in all of this — the customers left with nothing to show for their purchase. Travelzoo’s President Michael Stitt did respond to my email inquiries, and Travelzoo’s customer service manager did follow up with our consumer, Smidt. In Smidt’s case, the offer of help was too little, too late.
Travelzoo’s complaint doesn’t only lament the damage done to its own business. The lawsuit claims Fresh Trips made use of Travelzoo to make “false representations” to consumers, and “knowingly left many travelers without a promised hotel booking.”
“Even worse,” Travelzoo complains, “Defendants’ scheme caused travelers to be stranded in Mexico without accommodation.”
Yes, it’s bad. And unfortunately, this doesn’t bode well for Smidt and others similarly situated. Defending a lawsuit costs money, and obviously, so does losing a lawsuit. Money that Fresh Trips won’t have to pay back customers like Smidt.
But is Travelzoo the victim it would like us to believe? I have a lot of experience studying cases where things go horribly wrong. And if there’s one common denominator in all of them, it’s that there is never a single lapse in judgment, but many.
I don’t want to suggest that heads should roll at Travelzoo, but a close review of the problems leading to this debacle is warranted. After all, Travelzoo is a membership site that claims to carefully vet the offers published on its site, going so far as to say, “we never recommend a deal that we wouldn’t book ourselves.” So whatever transpired leading up to the advertisement of this deal deserves a careful examination by the powers that be at Travelzoo. Ignoring the problems behind this mess and placing blame exclusively on Fresh Trips will only lead to recurrences of this type.
And while Travelzoo might weather this storm, it needs to up its game if it intends to keep its loyal customer base.
We’ll continue to monitor this litigation as it unfolds. Fresh Trips will undoubtedly file blanket denials in its answer to the complaint, but if the case survives the initial phases, more light will be shed on this unfortunate scam.
And because our focus is always on the consumer, we’ll let you know how Smidt’s case concludes.