Gogo In-Flight Internet Monopoly Class Action Allowed to Continue

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A federal judge on Thursday rejected Gogo Inc.’ motion to dismiss an antitrust class action lawsuit against the in-flight Internet provider, saying that even if the company doesn’t have 85-percent market saturation as the plaintiff contends, he has still established enough documentation indicating that a potential monopoly on airplane WiFi exists.

Gogo sought to dismiss the class action lawsuit based on the argument that lead plaintiff James Stewart “failed to allege a plausible claim for relief” because the allegations do not specifically add up to the “85 percent” number Stewart came up with in the complaint. In a Jan. 30 ruling, however, Judge Edward M. Chen found that while there were questions of fact regarding the math used by Stewart, they do not preclude the case from moving forward.

The Gogo Internet monopoly class action lawsuit alleges that through “a series of long-term exclusive contracts with the major domestic airlines in the United States,” Gogo has effectively created a monopoly by heightening the barrier to entry for competitors and causing artificially inflated pricing. The class action notes that major airlines — including American, Delta, and US Air — had their fleets entirely or nearly entirely locked up by Gogo’s contract, providing the possibility that Gogo had tied up a major portion of the market.

According to Ninth Circuit Court of Appeals precedent, it must only be plausible that the market share is roughly 45-70 percent.

Judge Chen ruled that Gogo’s argument that contracts for Gogo in-flight Internet service were relatively easy to break, leading to fluidity in the market, were belied by SEC filing’s stating that the company had filed a lawsuit citing breach of contract when an airline attempted to do so.

The Gogo Internet class action lawsuits notes that the contracts for the service locked up carriers for 10 years, although at the time, the market saturation was 90 percent. However, even with the number ratcheted down, it met the standard for Judge Chen to allow it the antitrust case to proceed on the grounds for plausibility.

The plaintiffs are represented by class action lawyers Azra Z. Mehdi of The Mehdi Firm PC and Roy A. Katriel of the Katriel Law Firm.

The Gogo In-Flight Internet Monopoly Class Action Lawsuit is James Stewart, et al. v. Gogo Inc., Case No. 12-cv-05164, U.S. District Court, Northern District of California.