Marriott International, Inc.
- Company Name
- Marriott International, Inc.
- Stock Symbol
- Class Period
- November 9, 2016 to November 29, 2018
- Motion Deadline
- January 30, 2019
- Eastern District of New York
The complaint charges Marriott and certain of its officers with violations of the Securities Exchange Act of 1934. Marriott operates, franchises and licenses hotel, residential and timeshare properties worldwide. In September 2016, Marriott completed the acquisition of Starwood Hotels & Resorts Worldwide, Inc. (“Starwood”) for $13 billion.
The complaint alleges that defendants made false and misleading statements and/or failed to disclose adverse information regarding Marriott’s business and operations, including that Marriott’s and Starwood’s systems for storing their customers’ personal data were not secure and that there had been unauthorized access on Starwood’s network since 2014. As a consequence, the personal data of approximately 500 million Starwood guests, including sensitive personal information of approximately 327 million of those guests, may have been exposed to unauthorized parties. As a result of this information being concealed from investors during the Class Period, the price of Marriott shares was artificially inflated to as high as $149 per share.
Then on November 30, 2018, before the market opened, Marriott reported a potential data breach involving the personal information of 500 million Starwood guests. The Company’s press release stated that “Marriott has taken measures to investigate and address a data security incident involving the Starwood guest reservation database. On November 2018, the investigation determined that there was unauthorized access to the database . . . .“ According to the Company, “Marriott learned during the investigation that there had been unauthorized access to the Starwood network since 2014. . . . The company . . . believes [the database] contains information on up to approximately 500 million guests who made a reservation at a Starwood property,” and for “approximately 327 million of these guests, the information includes some combination of name, mailing address, phone number, email address, passport number, . . . date of birth [and] gender.” On this news, the price of Marriott shares fell $6.81 per share, or over 5.5%, to close at $115.03 per share on November 30, 2018.