Hilton has terminated its franchise agreement with a Minnesota Hampton Inn after a hidden camera video revealed the hotel was continuing to ban U.S. Department of Homeland Security agents, contradicting the owner’s claims that the issue had been resolved.
The backdrop: The scandal erupted Monday when the DHS posted screenshots on X showing the Hampton Inn Lakeville had canceled reservations for ICE agents.
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The emails from the hotel explicitly stated, “We are not allowing any ICE or immigration agents to stay at our property.”
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Hilton initially distanced itself, issuing a standard statement that the hotel was independently owned and operated and that the actions did not reflect the company’s values.
The plot twist: While the corporate response suggested the matter was settled, conservative commentator Nick Sortor visited the hotel with a hidden camera on Tuesday.
Notable reaction: Billionaire investor and Hilton shareholder Bill Ackman weighed in on X, amplifying the story and adding significant pressure on the corporate parent.
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What he said: Ackman criticized the “discriminatory” actions, calling it a violation of both the law and common sense, and suggested that Hilton needed to take decisive action to protect its brand reputation.
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Why it matters: Ackman’s involvement often signals to corporate boards that a reputational risk has metastasized into a shareholder concern, likely accelerating Hilton’s decision to sever ties.
What they’re saying: Hilton responded to the growing pressure by removing the hotel from its brand system.
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The statement: “The independent hotel owner had assured us that they had fixed this problem… A recent video clearly raises concerns that they are not meeting our standards and values. As such, we are taking immediate action to remove this hotel from our systems.”
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The end game: In a post to X Tuesday morning, Ackman noted the actions were that of a front office manager and not that of the hotel or its owners. Further, the investor noted, “Hilton takes any discriminatory actions by its franchisees with the highest degree of seriousness for obvious reasons. It, however, does not directly control the hiring and firing decisions of personnel at the hotel in question.”
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“Hilton is one of the best managed companies in the world. Its CEO, Chris Nassetta, is one of the most outstanding CEOs in the world. I know that he is highly respected by @realDonaldTrump and the current administration,” Ackman’s post concluded. “Chris became personally involved in this situation from the moment he became aware of it and took immediate action. As a Hilton customer and shareholder, I am comfortable that this situation was handled appropriately and in a timely fashion.”
The bottom line: The swift termination highlights the perils of the franchise model in a polarized political climate, where a local operator’s actions can instantly become a national reputational crisis for the parent brand.
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