Federal Trade Commission staff have told Priceline they intend to recommend the agency sue the online travel brand over its disclosures, fees, customer support and billing practices, according to a quarterly report filed this week by Norwalk-based parent company Booking Holdings Inc.
The disclosure in Booking Holdings’ Form 10 appears to be the first public confirmation that Priceline is the target of an FTC consumer protection investigation.
Booking Holdings said FTC staff notified the company in July that they plan to recommend a complaint against Priceline and an unidentified business-to-business affiliate partner, alleging “unfair or deceptive business practices” related to those four areas.
No complaint has been filed. The recommendation is an internal step that must be approved by the commission before the FTC can sue.
Priceline “does not agree with the FTC’s position” and is continuing discussions with the agency, Booking Holdings said. The company warned investors the matter could result in changes to Priceline’s business practices, financial penalties or other costs that could affect its financial results and reputation.
The company did not identify the affiliate partner or specify which practices prompted the investigation.
The disclosure came in the same filing in which Booking Holdings reported second-quarter revenue of $7.35 billion and net income of $1.95 billion, up from $895 million a year earlier. The company operates Booking.com, Priceline, Agoda, KAYAK and OpenTable, and employed about 25,550 people worldwide as of June 30.
The filing also disclosed details about an April data security incident involving Booking.com.
Booking Holdings said Booking.com notified certain data protection authorities after discovering unauthorized third parties had accessed some guests’ booking information. The company said it contained the incident and is cooperating with regulators.
The filing also warns that the breach could lead to regulatory investigations, lawsuits or fines, and that the company could be required to make commitments to regulators, consumers or business partners.
Booking.com began notifying affected customers in April, saying attackers may have accessed names, email addresses, phone numbers and booking details. The company declined at the time to say how many customers were affected.
The company continues to face several regulatory matters overseas, including appeals of a Spanish competition ruling, an order requiring Agoda to change certain business practices in France, investigations in Greece and Hungary, and mass claims filed in the Netherlands.
