Motel 6 to Pay $10M After New Times Story Exposing Collusion with ICE

Can Motel 6 afford to leave the lights on after paying $20 million in settlements? Probably.
Can Motel 6 afford to leave the lights on after paying $20 million in settlements? Probably. Eric Torres for Phoenix New Times
A federal judge has finally approved a settlement for a class action lawsuit against Motel 6 spurred by a Phoenix New Times exposé on the hotel chain's practice of sharing guest information with U.S. Immigration and Customs Enforcement. Under the agreement, Motel 6 will pay $10 million and abide by a three-year decree ensuring that the company will protect the privacy of its guests.

For the next three years, employees at all Motel 6 locations across the United States will be barred from releasing any information on guests to federal immigration authorities unless the feds present a warrant, subpoena, or credible proof that someone is in imminent danger.

In September 2017, a New Times investigation found that some Motel 6 outlets around Phoenix were collaborating with ICE by sharing information on their guests with ICE every day. At least 20 undocumented guests were arrested as a result.

The news prompted multiple lawsuits, promises from Motel 6 that they would discontinue the practice, a deluge of angry comments on Motel 6's social media, and a trending #BoycottMotel6 hashtag. Reporters Joe Flaherty and Antonia Noori Farzan both won the George Polk Award, among several others, for the story.

Four months later, a prominent Latino civil rights organization, the Mexican American Legal Defense and Educational Fund (MALDEF), filed a class action lawsuit against Motel 6 and its parent company, G6 Hospitality, saying the company's practice of sharing guest lists with ICE was "racially discriminatory, unconstitutional, and violates laws that protect privacy rights and the rights of consumers.”

The lawsuit argued that Motel 6 had violated the Fourth Amendment, federal nondiscrimination law, and Arizona laws forbidding deceptive business practices and intrusions of privacy by sharing guest lists with ICE.

By November 2018, Motel 6 agreed to pay a $7.6 million settlement for the suit. The settlement required Motel 6 to compensate guests who were questioned or placed in deportation proceedings by ICE as a result of the company's actions. Unclaimed funds would be allocated to nonprofits that provide legal assistance and scholarships to undocumented immigrants.

Yet the federal judge overseeing the suit said he needed more information on the number of guests affected by Motel 6's practices before approving the settlement.

While that was being negotiated, New Times' reporting on Motel 6 led to another multimillion-dollar settlement in Washington. In April 2019, Washington Attorney General Bob Ferguson announced that the owners of Motel 6 agreed to pay $12 million to customers in Washington as a settlement for a suit brought by his office against the company for providing guest lists to ICE agents from 2015 to 2017.

On Tuesday, the federal judge in the class action case brought by MALDEF approved the renegotiated settlement agreement — and Motel 6 will pay more than the initially agreed upon amount. As part of the agreement, Motel 6 will pay nearly 2,000 claimants payouts ranging from $75 to $200,000. Any unclaimed funds will go to the Florence Immigrant and Refugee Rights Project, the Northwest Immigrant Rights Project, the National Immigration Justice Center, and TheDream.US.

“We are grateful that Motel 6 will change practices and is compensating those harmed,” said Thomas A. Saenz, MALDEF president and general counsel, in a press release. “The substantial settlement should stand as a warning to all other proprietors not to engage in similar conduct.”

The settlement also includes an agreement that Motel 6 will implement and maintain some policy changes at all Motel 6 locations across the United States for the next three years. Under the agreement:

• Motel 6 will be required to maintain a 24-hour hotline to assist employees at Motel 6 when they receive any request for guest information from federal immigration authorities.
• When federal immigration authorities ask for information, Motel 6 employees will refuse to share guest information without a judicially enforceable warrant or subpoena, except if the feds can give a credible reason that someone is in imminent danger.
• If federal immigration authorities do present a subpoena, Motel 6 employees still should not share guest information until the warrants or subpoenas have been sent to Motel 6's legal department or other designated Motel 6 employees who are trained to comply with the policy and can authorize the disclosure of guest information.
• Motel 6 will create an online form for guests to submit a report if he or she believes their information has been wrongfully provided to federal immigration authorities.
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Meg O'Connor was a staff writer for Phoenix New Times from April 2019 to April 2020.