The Oasis Case: Notes on a Conflict that Ends Up in a Lawsuit

Although he continues telling the press that he’s being chased by his secure-businessman image, it’s clear that Juan Jose Hidalgo, president of the Globalia Group, shall be worried these days. The hotel division of his rock-solid tourism empire has turned into a genuine problem since the conflict was sparked off months ago by Pedro Pueyo, a businessman and owner of Oasis establishments, managed by Globalia since 2007.

The alliance between both parties was agreed three years ago. Globalia was interested in growing up in the hotel business, and Travamerica Incorporated, owner of Oasis and whose president is Pedro Pueyo, was looking for an experienced partner to operate and market eleven thousand rooms in the Caribbean. They signed a favorable agreement for both parties and their common project had a fast development.

However, as the media has published, it all seems to indicate that the disagreement began last year. The flu outbreak in Mexico forced Globalia to close down eight of its hotels all over the country. It was when Hidalgo’s group offered Oasis a discount related to the rent on the facilities, but Pueyo turned it down.

The disagreement between them was so tense that the case ended up in court, and while Oasis’ owner was taking the case from courthouse to another, Globalia decided to stop operating its establishments under the Oasis brand, taking on a new brand, Be Live Hotels.

Pueyo blames Globalia of “breach of contract” and argues that his partners “fell into legally wrong actions”, which caused his company “to lose millions of dollars”. But it seems the conflict has reached the top: a judge from the American state of Georgia has imposed as preventive measure for Globalia, on a sentence pronounced on August 5th, the promotion and marketing to be halted for eleven establishments located in Riviera Maya and Cancun, Mexico.

A Lawsuit Taking Some 4 Thousand Rooms Out of the Market
That judge’s sentence goes against Intertravel S.A.R.L; Globalia Corporacion Empresarial, S.A.; Globalia Explotaciones Hoteleras, S.L.U. and Operadora Globalia de Mexico, S. de R.L. de C.V. All of them are subsidiaries of Globalia Group, and it not only bans those companies from continuing the sale of the hotels on trial to clients in the United States, Canada and Europe, but it also applies to tour operators and travel agencies marketing those rooms.

According to the statements of Jesus Almaguer, director of Tourism Promotion Trusteeship in Quintana Roo: “This sentence pulled out of the market the hotels managed by the Spanish company, which operates 3,910 rooms in the state, almost 20 percent of the current capacity in Cancun”. As the local media and international agencies assert, during the next weeks once those rooms stop being offered to the mentioned markets, the facilities will go empty.

Of course, the law action stipulates that if the marketing continues “Oasis’ loss would be outstandingly increased and so the charges pressed against Globalia”. If operators, wholesalers or travel agents sell one of those rooms, which are under preventive measure, it would be a violation of a mandate by the American federal justice.

Is It Time for Negotiation?
That’s what many people are wondering. The Spanish media almost ensures that those who are close to Juan Jose Hidalgo might be urging him to make a decision so as to work out the conflict with Pedro Pueyo before it gets too pricey for Globalia Group. The possibility of a pact looks tricky for both parties, especially now that the conflict has become such a media-hyped case.