>Hilton and Starwood settle lawsuit over trade secrets

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>Hilton Worldwide and Starwood have reached an agreement in the unusual – and unusually nasty – feud that pitted two hotel giants against each other over corporate spying.

The unprecedented case started in 2008 when Starwood charged that Hilton – and two former Starwood executives who had joined Hilton’s luxury hotel development team – stole documents to help Hilton develop its own version of Starwood’s successful W hotel chain (Denizen) and rush it to market. A federal investigation was launched in April 2009 into the allegations, at which time Hilton grounded efforts to develop Denizen.

Newly filed court documents show that Hilton and Starwood’s agreement:

  • Bans Hilton until January 2013 from developing a hotel brand that would compete in the same category as Denizen, the W-style hotel that it tried to develop using information.
  • Requires Hilton to make payments to Starwood; no sum is disclosed.
  • Calls for Hilton to be supervised until January 2013 by two federally appointed monitors to, Starwood says, “assure that the conduct that occurred does not occur again.”

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