Answer:
One legitimate reason why the courts did not preempt the conflicting state law could be that the federal agency's rule did not have the authority to completely override or preempt state law in this particular context. The courts may have considered factors such as the scope of the federal agency's jurisdiction, the specific language and intent of the state law, and any potential conflicts with constitutional principles or other federal laws. The courts may have concluded that, despite the conflict, the state law still served a legitimate purpose and was within the state's authority to regulate hotels.