Rough week for Marriott includes angering China and a family lawsuit gone public

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It's been a trying week for Marriott International, marked by family infighting gone public and a rebuke by China over a survey gone wrong.

On Thursday, Marriott International CEO Arne Sorenson in a statement was forced into a mea culpa regarding a wrongly worded survey in China that listed Tibet, a region of China, and Taiwan, an island China claims as its own, as separate countries. The survey also reportedly listed Hong Kong and Macau as separate, but they are territories ruled by China. 

The mistake drew the ire of the Chinese government, compelling Sorenson to come out with a statement that read in part: "Marriott International respects and supports the sovereignty and territorial integrity of China. Unfortunately, twice this week, we had incidents that suggested the opposite: First, by incorrectly labelling certain regions within China, including Tibet, as countries in a drop-down menu on a survey we sent out to our loyalty members; and second, in the careless “like” by an associate of a tweet that incorrectly suggested our support of this position. Nothing could be further from the truth: we don’t support anyone who subverts the sovereignty and territorial integrity of China and we do not intend in any way to encourage or incite any such people or groups. We recognize the severity of the situation and sincerely apologize."

As The New York Times pointed out, the error by Marriott is a recurrent one made by companies that do business in the China. "A simple website drop-down menu labeled 'countries' can inadvertently bestow the nation label on places like Taiwan and Hong Kong," the Times wrote. 

Still, the blunder by Marriott has stoked outrage, with China responding to the slight by reportedly shutting down Marriott’s Chinese website and its Chinese app for a week. Social media in China fumed over Marriott's blunder... "They are earning our people’s money and yet they are thinking of splitting our motherland,” one user on Chinese social media platform Weibo wrote. 

Sorenson's statement continued: "As soon as we became aware of the issue with the survey, we worked to take it down and make the necessary corrections. We also reviewed the other areas on our websites and apps where this type of functionality might exist to make sure the labeling is correct. In China, at the request of the Government, we have taken down our Chinese websites and apps to conduct a full review and audit. We also quickly un-“liked” the tweet and posted a statement of apology on Twitter."

Marriott has a lot at stake in China, where, according to Lodging Econometrics, it has 270 hotels open totaling 96,774 rooms. Marriott's pipeline in China currently stands at 272 projects totaling 76,595 rooms.

Family Feud

As if the China gaffe wasn't enough, Marriott—specifically the Marriott family—was back in the public eye over an explosive lawsuit that has all the local D.C. media abuzz. (Marriott's headquarters are in Bethesda, Md.) The lawsuit, which came to light back in October, was brought by John Marriott III, the son of Marriott Chairman Bill Marriott, against his father alleging that Bill Marriott "disowned him, cut him off from his trust fund, drove him out of the family business, and is attempting to push him into financial ruin, all triggered by John’s 2015 divorce against the wishes of his devout Mormon parents," as the Washingtonian put it. 

The Marriott family, which has always maintained a very wholesome public image, are devout Mormons, a religion that strongly discourages divorce. The entire drama is sensational, marked by counterclaims by Bill Marriott over his son's alleged drug use. In a motion to dismiss the lawsuit, Bill Marriott claims John’s allegations are false, and that his son’s drug and alcohol abuse is to blame for the family rift.

John Marriott, in a series of interviews with the Washingtonian, described what he says were a "series of punishments from his father, arising from his divorce—including allegations that he was forced off of Marriott International’s board, and forced out as CEO of another family hotel business called JWM Family Enterprises." Bill Marriott disputed this in their counterclaim, alleging that John’s own “damaging behaviors stemming from his addictions are the cause of any professional consequences.”

John was the CEO of JWM Family Enterprises, another Marriott family business, but was forced out. Bill Marriott and his brother, Richard, John's uncle, allege that “John went missing for weeks" and was unreachable. Bill and Richard then say "John was offered a set of terms under which he could remain as CEO of JWM, but he declined. The terms included submitting to random drug testing and being in the office or on business travel Monday through Friday.

In October, John Marriott said the last thing he wanted to do was sue his dad and uncle.