The nearly two-year legal battle over breach of contract between an eLong subsidiary, eLong Information, and an affiliate of Qunar, Beijing Qunar, ended when the Beijing Municipal High Court dismissed Qunar’s appeal and upheld the First-Instance Judgment on June 29, 2015.
The court held Beijing Qunar to be in breach of contract for its early termination of the Affiliation Agreement and rejected Qunar's claim that eLong had breached the Affiliation Agreement.
Both parties are ordered to resume their PRC domestic agency hotel inventory cooperation under the terms of the Affiliation Agreement.
Beijing Qunar must compensate eLong Information RMB52,335,396 (US$8.4 million) for the period from September 6, 2013 - September 30, 2014, as stipulated in the Affiliation Agreement.
Beijing Qunar must also to pay eLong Information an advertising credit of RMB27 per room night if it failed to meet the room night target of 450,000 PRC domestic hotel room nights per quarter plus RMB227,599 (US$37 thousand) in legal fees, and apportioned court fees between the parties.
However, eLong Information must pay RMB8,127,402 (approximately US$1.3 million) in commissions to Beijing Qunar for room nights sold under the Affiliation Agreement during the period from July 1, 2013 through September 5, 2013, prior to Beijing Qunar's breach of contract.
The case began in 2013 when eLong Information brought Beijing Qunar to court for improperly terminating a three-year hotel inventory redistribution agreement.
The Beijing First Intermediate Court issued a judgment on December 26, 2014 which was appealed unsuccessfully by Qunar.
Even with a clear victory in court, eLong vowed it will take all necessary and appropriate actions if Beijing Qunar fails to perform the on Final Judgment.
For its part, Qunar was unfazed by the decision and in a statement released on July 1 it said: “In the three months ended December 31, 2014, the company has already recorded in its financial results a one-time loss provision relating to this lawsuit. The company does not believe that the Final Judgment will have any material impact on its future business, results of operations or financial condition.”
Read eLong press release
Read Qunar press release
