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Puttin' Off the Ritz

Ritz-Carlton Link with Bali Resort to End March 31st Following Landmark U.S. Court Decision Against Marriott.


Bali News: Puttin' Off the Ritz
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(1/25/2009)

In a sudden, if not unsurprising, announcement, the Ritz-Carlton will be withdrawing its brand and ceasing management of its very successful 368-key kuxury resort at Jimbaran Bay in Bali.

In an email to the travel industry sent on Thursday, November 20, 2008, by a senior sales executive of the property, it was announced that effective March 31, 2009, "the Ritz-Carlton Hotel Company will no longer be managing The Ritz-Carlton Bali Resort and Spa." After that date the Ritz-Carlton brand, name, trademarks and logo may not be used in reference to the property.

The hotel's customers and marketing partners holding bookings after that date have been advised that while their reservations will be honored, the management of the hotel and its services will have no connection with Ritz-Carlton.

While rumors are rife on what company might step into the vacant management role at the Resort, no formal announcement on that subject has been made to date.

The momentous announcement is almost certainly tied to a landmark ruling by a U.S. Federal Court earlier this year finding on behalf of KMS, the Indonesian owners of the Resort, in their suit against Marriott - the owners of the Ritz-Carlton brand. After a 14-day trial, Maryland jurors ruled that the 2006 opening of the Bulgari Resort, Bali - operated by Bulgari Spa with Marriott, represented a breach of a "non-competing" clause agreed between Ritz-Carlton with the Indonesian owners of the Bali property.

A subsequent ruling in the case by the Maryland Courts in April 2008 granted the Indonesian's owners request for declaratory relief and opened the way for Karang Mas Sejahtera (KMS) to, at its option, terminate its relationship with Ritz-Carlton.

The suit awarded US$10 million dollars in damages and legal expenses to the Indonesian owners to be paid by Marriott.

Outside the legal wrangling surrounding the case, many members of the travel community are sad to see an end to what is generally regarded as the very professional management of the Resort which enjoys one of the highest rates and average occupancies in Bali.

Stay tuned for future developments, including details of the new managers for soon-to-be-former Ritz-Carlton Bali, Resort & Spa.

Related Article

[U.S. Jury Awards US$10 M to Ritz-Carlton Bali Owners ]

[Further Developments in Ritz-Carlton Case]


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