Porter sues Air Canada for $850M

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Old Oct 26, 07, 11:41 am
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Porter sues Air Canada for $850M

I'm hoping a thread about AC being sued constitutes inclusion in this forum.

http://www.canada.com/nationalpost/f...d1c8ba&k=76598

Toronto Island upstart Porter Airlines launched a lawsuit Friday to sever ties between Air Canada and its regional carrier Jazz Air LP, contending the current capacity purchase agreement violates Canadian competition laws. Porter is also seeking $850-million in damages.
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Old Oct 26, 07, 11:58 am
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http://www.newswire.ca/en/releases/a.../26/c8728.html

HALIFAX, Oct. 26 /CNW/ - Jazz Air LP ("Jazz") maintains that the
allegations issued in a news release today by Porter Airlines and its
affiliates are completely without merit and will be vigorously contested in
court.
Jazz continues to seek fair and equal access at the Toronto City Centre
Airport. Porter Airlines continues to launch unfounded allegations against
Jazz in an effort to prevent competition at the Toronto City Centre Airport.
The Toronto Port Authority is also precluding competition at the Toronto
City Centre Airport by controlling commercial activity. This is not their
role. This practice is unprecedented in Canada and poses a threat to the
Canadian aviation industry.
Jazz's business agreement with Air Canada is a standard industry practice
between regional and mainline carriers in North America. Jazz operates flights
on behalf of Air Canada.
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Old Oct 26, 07, 1:06 pm
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Very interesting. They could go on losing money for years if they win this one. Should be interesting to watch this one unfold.
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Old Oct 26, 07, 1:16 pm
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Originally Posted by stinger View Post
Very interesting. They could go on losing money for years if they win this one. Should be interesting to watch this one unfold.


You're a funny goose. Porter just made itself a laughing stock.

By the way, will Carty sue American Airlines because it has the same arrangement with Eagle? Heck, he ought to know, as CFO he oversaw it for years.

Will Porter sue Continental when it gets to Newark. CO operates the same deal with Continental Express?

Totally and transparently frivolous.

By the way, how does a supposedly profitable airline with four aircraft and a monopoly at its home base airport claim any damages from anybody. Even if it claimed that it should be compensated for every empty seat it ever had, it wouldn't be 5% of its claim.
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Old Oct 26, 07, 1:23 pm
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Originally Posted by tcook052 View Post
I'm hoping a thread about AC being sued constitutes inclusion in this forum.

http://www.canada.com/nationalpost/f...d1c8ba&k=76598

Toronto Island upstart Porter Airlines launched a lawsuit Friday to sever ties between Air Canada and its regional carrier Jazz Air LP, contending the current capacity purchase agreement violates Canadian competition laws. Porter is also seeking $850-million in damages.
$850 Million!? A little over-the-top, no? Why not just round it to a nice, even $Billion dollars?! Ridiculous. Guess they were watching Austin Powers movie or something.
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Old Oct 26, 07, 2:14 pm
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They must be really losing money. The agreement was in place when PORTER did up its business plan and investors prospectus, why not go to the competition bureau at that point? I suspect the boys smoked a few too many soggies the other night and one of the lawyers at the table committed his firm to this frivolous action. But then again, PORTER has made more money with suits or threats of suits (about the breached "contract" for the bridge) than flying airplanes. I see this has dropped JAZZ units another 8 today. Maybe PORTER intends to make money shorting JAZZ?!
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Old Oct 26, 07, 2:35 pm
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"In documents filed in the Ontario Superior Court of Justice Friday, Porter claims Air Canada and Jazz conspired to lessen competition in air travel Canada by entering into the agreement, which it alleges unfairly establishes airfare prices, dominance, avoids competition and impedes upon new competitors, including Porter, from entering the market."

Yup. That part is totally strange.

But what of the following paragraph:
"It also alleges that the agreement requires Canadian passengers to enter into an exclusive contract which offer discounts only if Air Canada and Jazz are assured of a substantial percentage of business system-wide."??????

Am I misreading or what the h**l is that? I don't remember ever entering into an exclusive contract with AC or anyone else for that matter...
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Old Oct 26, 07, 2:40 pm
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Originally Posted by respectable_man View Post
But what of the following paragraph:
"It also alleges that the agreement requires Canadian passengers to enter into an exclusive contract which offer discounts only if Air Canada and Jazz are assured of a substantial percentage of business system-wide."??????

Am I misreading or what the h**l is that? I don't remember ever entering into an exclusive contract with AC or anyone else for that matter...
What that is really referring to (as read in another on-line news article) is to CORPORATE transportation agreements with AC, that provide for discounts so long as AC/Jazz are given the vast majority of that companies bookings. Now, perhaps the exclusivity provisions of these sorts of deals are suspect, but they certainly could offer it as a volume only agreement without problems.
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Old Oct 26, 07, 2:42 pm
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Originally Posted by robsawatsky View Post
What that is really referring to (as read in another on-line news article) is to CORPORATE transportation agreements with AC, that provide for discounts so long as AC/Jazz are given the vast majority of that companies bookings. Now, perhaps the exclusivity provisions of these sorts of deals are suspect, but they certainly could offer it as a volume only agreement without problems.
Thanks for the clarification.
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Old Oct 26, 07, 2:46 pm
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Now when Porter finally goes belly-up (before the lawsuit is settled) all the big shot's at Porter have a scapegoat and can walk away without a scratch.
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Old Oct 26, 07, 3:15 pm
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Didn't Jetsgo sue Westjet just before they went bankrupt? Will history repeat itself?
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Old Oct 26, 07, 5:47 pm
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Originally Posted by stinger View Post
Very interesting. They could go on losing money for years if they win this one. Should be interesting to watch this one unfold.
But they won't. The flying rodent will be cooked sooner rather than later judging by this desperate suit. Anyone want to lay bets on how long it is before Carty parachutes out of this mess?

Last edited by LeSabre74; Oct 26, 07 at 5:48 pm Reason: spelling
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Old Oct 26, 07, 5:48 pm
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The only difference I see between circumstances now and when Porter was on the drawing board is the sell off of Jazz by ACE. But given that Porter alleges conspiracy to prevent them from entering the market, I guess they're not basing their case on that fact.

Seems dumb. They lose a lot of credibility as a serious entrant into the market in my eyes.
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Old Oct 26, 07, 6:26 pm
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Originally Posted by LeSabre74 View Post
Anyone want to lay bets on how long it is before Carty parachutes out of this mess?
I read in some of the clippings on VIRGIN AMERICA that Carty is on the board, possible Chair. Didn't he also sign onto an Hawaiian startup?
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Old Oct 26, 07, 10:18 pm
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Originally Posted by Shareholder View Post
Didn't he also sign onto an Hawaiian startup?
You got it, braddah:

http://www.flyertalk.com/forum/showthread.php?t=343509
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