Flyers Sue Major U.S. Airlines Over Allegations of Price Collusion

Jeff Edwards July 08, 2015

A group of disgruntled flyers, claiming that the largest airlines in the U.S. have conspired to artificially inflate ticket prices, is seeking damages in a federal courtroom.

A Department of Justice (DOJ) probe into possible price collusion among the four largest airlines in the U.S. — American Airlines, United Airlines, Delta Air Lines and Southwest Airlines — has spurred flyers to file lawsuits seeking damages. Bloomberg is reporting that a class-action suit filed on July 1 in a White Plains, N.Y. federal courtroom and a similar suit filed in federal court in Chicago on July 2, are among the first attempts to claim damages on behalf of the flying public.

According to court documents, the lawsuit filed in Chicago claims that the four airlines named in the suit have worked together to systematically gouge passengers. The complaint asserts: “Defendants have, in tandem, raised fares, imposed new and higher fees on travelers and reduced their capacity and service.”

The plaintiffs have asked the court to include in the legal action, any passengers who purchased a ticket from American, United, Delta or Southwest from October of 2012 to the present.

Both complaints note that the four airlines named in the suits represent an 80 percent market share of the U.S. airline industry, thereby making allegations of price-fixing a violation of federal antitrust regulations. Under certain circumstances, plaintiffs that can prove damages caused by anti-competitive practices can be awarded treble compensation or triple their actual damages.

The four airlines have declined to speak to reporters about the pending legal actions, but American CEO Doug Parker penned an unequivocal denial of any inappropriate activity under his watch in a spirited letter to employees on July 4. In the message to the rank and file, Parker declared, “On behalf of your entire leadership team, let me be crystal clear: there has been no illegal behavior on the part of American Airlines.”

[Photo: iStock]