Delhi HC Bans Hotel Associations From Boycotting Oyo Rooms; Says This Revolt Is Illegal
In a twist of events, Delhi High Court has come out in support of Oyo Rooms, and have banned various Hotel Associations from calling a strike against Oyo Rooms.
This is a huge setback for Hotel Association from Kochi, which had revolted against Oyo Rooms, and refused to entertain any new bookings made for 48 hours.
What did Delhi High Court say?
Delhi High Court: Call For Oyo Strike Is Illegal
After Oyo Rooms approached Delhi High Court against Hotelier Welfare Association’s call for boycott, the Bench has supported Oyo Rooms.
In a clear verdict against the Hotel Associations, the vacation Bench of Justice Jayant Nath has said that such boycott calls are illegal, and Hotel Association must stop them.
The Bench said, “It appears that the said act of the defendants is essentially pushing other hoteliers/service providers to act in breach of contract between the plaintiff and its service providers/hoteliers with whom the plaintiff has an appropriate agreement. Such an act prima facie would be illegal.”
In layman terms, this means that the Hotel Associations cannot call for Oyo Room boycott, and if they are under a contract, then they cannot break the contract.
The verdict also observed that since the hotels and Oyo Rooms are under a contract, then the hotel chain/network (that is Oyo Rooms) has full control over the pricing, tariff changes, and other financials, as per the terms of the contracts.
Huge Setback For Hotel Associations
Yesterday, we had reported that the Kerala Hotel and Restaurant Association (KHRA) have called for a boycott of Oyo Rooms, and have refused to accept any new bookings from them for next 48 hours.
This was done in protest of Oyo Rooms reducing the profit margins, and forcing the hotels to pay for the discounts.
Such similar boycotts and revolts were also reported from Mumbai earlier, and other cities.
Now, after the Delhi High Court verdict, the tables have turned, and now, the hotels and their associations cannot call for a nation-wide or city-wide ban/boycott of Oyo Rooms, if they are under the contract.
How will the hotel associations react now?
We will keep you updated, as we receive more informartion.