American Airlines Will Pay $45M To Settle Ticket Price-Fixing Lawsuit

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A multidistrict litigation alleging several major airlines engaged in schemes to keep ticket prices high will be ended for American Airlines, which has agreed to pay $45 million to settle the claims.

Lead plaintiffs alleged in the airline price-fixing multidistrict litigation that American, as well as several other major airlines, engaged in antitrust agreements to keep the price of airline tickets high for consumers.

The plaintiffs say that the airlines artificially limited the number of seats available, leading to increased prices and more than $20 billion in profits for the airlines.

American Airlines will be allowed to exit the airline price-fixing multidistrict litigation under the terms of the recent $45 million settlement agreement.

“The settlement amount, which is three times the size of the Southwest Settlement already approved by the court, provides substantial value to the settlement class in light of the attendant risks of continued litigation,” states the American Airlines price-fixing multidistrict litigation settlement agreement. “Not only will the $45 million cash payment provide a monetary benefit to settlement class members, the settlement also preserves their right to recover the entire amount of damages against the non-settling defendants.”

Late last year, Southwest agreed to settle claims against them in the airline price-fixing multidistrict litigation by agreeing to pay $15 million to proposed Class Members.

The other defendants in the airline price-fixing multidistrict litigation are Delta Air Lines and United Airlines. The airline price-fixing multidistrict litigation accuses them of scheming to keep ticket prices high even though fuel and other costs were going down.

In addition to the $45 million payment, American Airlines has agreed to assist the plaintiffs in the airline price-fixing multidistrict litigation in their claims against Delta and United.

“Pursuant to the Settlement Agreement, American will make a cash payment of $45 million and undertake certain actions in connection with Plaintiffs pursing their case, including making available for deposition up to three current American employees or former American employees represented by American’s Counsel, answering questions regarding American’s documents and transactional data, and producing business records and authenticity declarations or affidavits,” states the airline price-fixing multidistrict litigation settlement agreement.

Together, the four airlines make up 80 percent of the commercial flight industry. The airline price-fixing multidistrict litigation alleges that the price-fixing scheme was in addition to higher baggage check fees, netting $21.7 billion in profit for the Big Four in 2015 alone.

After the airline price-fixing multidistrict litigation was filed, the airlines fought back arguing the plaintiffs failed to show any evidence of collusion; however, they lost their bid for dismissal with a federal judge noting that circumstantial evidence, along with parallel conduct, in this case statements by executives about seating, could establish the antitrust claims.

The plaintiffs are represented by co-lead interim class counsel Michael Hausfeld, Hilary K. Scherrer, Jeannine Kenney, Michael P. Lehmann and Bonny E. Sweeney of Hausfeld LLP and Adam J. Zapala and Alexander E. Barnett of Cotchett Pitre & McCarthy LLP.

The American Airlines Price-Fixing Class Action Lawsuit is In re: Domestic Airline Travel Antitrust Litigation, Case No. 1:15-mc-01404, in the U.S. District Court for the District of Columbia.

UPDATE: March 2019, a website has been established for consumers who purchased a domestic airline ticket on American, Delta, Southwest, United, Continental, or US Airways to find out about a pending class action lawsuit. Click here to learn more.