Airline Travel Companies Hit With Inflated Ticket Price Class Action

Last week, the plaintiffs in an antitrust class action lawsuit accusing air travel ticket companies of contributing to an increase in ticket prices argued that the Airline Deregulation Act does not bar their claims.

Lead plaintiffs initiated the airline antitrust class action in 2015 alleging that global distribution systems conspired to charge excess fees for airline tickets after the federal government deregulated airlines under the Airline Deregulation Act in 2006.

Global distribution systems act as a link between private airlines and ticket sellers. The plaintiffs alleged that the various global distribution systems entered into contracts that required major airlines to make all their fares available on the systems and prevented the airlines from using discounted ticket sites. The plaintiffs further alleged that the global distribution systems then used these contracts as leverage to charge extra fees, discourage competition, and drive up the cost of air travel.

The global distribution systems companies argued that the Airline Deregulation Act barred the plaintiffs’ claims in the airline antitrust class action lawsuit. The companies stated that the Act should preempt the class action and the plaintiffs cannot establish that they were harmed by the agreements over ticket sales between the airlines and the global distribution system companies.

The class action plaintiffs filed a motion with the court arguing that the global distribution companies should not be let off the hook by the Airline Deregulation Act. In their motion, the plaintiffs alleged that the companies act as ticket distributors who are “intermediaries” between airlines and ticket purchasers and thus not entitled to protection under the Airline Deregulation Act.

“[T]he Supreme Court, the Second Circuit and the overwhelming majority of other courts have never extended [Airline Deregulation Act] preemption to claims that would impose state law on anyone but an air carrier,” said the plaintiffs in their motion.

The class action plaintiffs also argued that there is a clear connection between the alleged conspiracy to charge extra fees and inflate air travel ticket prices and the harm suffered by air travel ticket purchasers. “The causal nexus between defendants’ conspiracy and inflated airfares is traceable and obvious,” said the plaintiffs in their motion.

The plaintiffs also countered the global distribution systems companies’ argument that the class action’s claims were filed too late and are barred by the statute of limitations. The plaintiffs alleged that information supporting their claims in the class action was only brought to light in 2015.

The plaintiffs are represented by Heins Mills & Olson PLC, Grant & Eisenhofer PA, Lite DePalma Greenberg LLC, Girard Gibbs LLP, Barrack Rodos & Bacine, Freed Kanner London & Millen LLC, Joseph Saveri Law Firm Inc., Hagens Berman Sobol Shapiro LLP, Berger & Montague PC, Freedman Boyd Hollander Goldberg Urias & Ward PA, Fine Kaplan and Black RPC, Karon LLC, Shulman Law, Spector Roseman Kodroff & Willis PC and Andrew J. McGuinness.

The Airline Antitrust/Inflated Airline Ticket Price Class Action Lawsuit is Gordon et al. v. Amadeus IT Group SA et al., Case No. 1:15-cv-05457, in the U.S. District Court for the Southern District of New York.

UPDATE: February 2018, an antitrust class action settlement has been reached that will require Travelport to change its business practices in ways that may lead to lower airfares. Click here for more information.