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Hotel Lawyer on the fiduciary, contractual and agency duties of hotel brokers – Host Hotels & Resorts LP v. Molinaro Koger litigation

15 August 2011

Hotel Lawyer on brokers, agents fiduciary duty and charges of trust betrayed as laid out in the high-profile lawsuit of Host Hotels & Resorts against Robert T. Koger (personally) and his brokerage firm Molinaro Koger, Inc.

I was recently interviewed by Jason Freed of HotelNewsNow (a division of Smith Travel Research) about three high profile lawsuits in the hospitality industry. One of these cases was Host Hotels & Resorts v. Robert T. Koger. In this litigation, Host Hotels & Resorts sued a number of defendants, including Rob Koger and his firm, Molinaro Koger, for breach of fiduciary duties, breach of contract, fraud and other serious claims.

Lawsuits between sellers and brokers are not particularly common in the hospitality industry. And lawsuits alleging fraud are even less common.

One of the reasons I enjoy working in the hospitality industry is the optimism, openness and collegiality that exists throughout the hospitality community. Developers, owners, operators, lenders, brokers, lawyers, consultants, advisors, trade media — we all depend upon each other. Although I am a rigorous advocate for my client’s position in negotiations, there is an understanding, including with those on the “other side”, that we are working together for the success of making the deal or completing the project.

Anyone in this industry will tell you that a serious charge of violating the fiduciary duties a professional owes to his client is troubling. But a claim of fraud goes a step further. And personally naming a high-profile industry leader is really an attention-getter, particularly by an institutional player like Host Hotels.

As I told Jason in the interview about this lawsuit: “These are serious allegations. A lot of facts were put into the complaint, such as who called who and who did what. You have very specific, detailed, factual allegations.” This lawsuit does not look like it was filed to get discovery and run a fishing expedition. It looks like someone already has the goods.

Still, at this time, they remain allegations in a complaint. How this lawsuit will play out is anyone’s guess, but many will be watching. If you would like a copy of the complaint, let me know and I will email it to you.

Click here to read Jason Freed’s article Checking in on high profile lawsuits on HotelNewsNow.

Click here to read my commentary on M Waikiki’s Edition litigation against Marriott and Ian Schrager.

Click here to read my commentary on Hotel Lawyer on the importance of brands — intellectual property rights and what they mean.

This is Jim Butler, author of and hotel lawyer, signing off. We’ve done more than $87 billion of hotel transactions and have developed innovative solutions to unlock value from hotels. Who’s your hotel lawyer?

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