Italianaviator
Well-Known Member
Did anybody see Delta Airlines stock tank today? down 11% Probably because of this lawsuit.
http://www.courthousenews.com/2009/05/27/Class_Claims_Airlines_Colluded_in_Bag_Fee.htm
Class Claims Airlines Colluded in Bag Fee
By JACQUELINE J. HOLNESS
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ATLANTA (CN) - A federal class action claims Delta Air Lines and AirTran Airways colluded to charge first-bag fees. Both airlines, which are each other's principal competitors, began charging a $15 first bag fee in fall 2008.
Before then, "competition between Delta and AirTran prevented either airline from charging a first-bag fee for fear of losing sales to the other," say named plaintiffs Brent Avery and David Watson.
Earlier that year, Delta Air Lines acquired Northwest Airlines, which charges a $15 first-bag fee. Delta then was asked whether it would charge a fee as well to match Northwest's practices. "Considering that AirTran did not impose a similar fee on consumers, Delta stated that it had 'no plans' to charge consumers a first bag fee,'" according to the complaint.
But the class claims "an agreement between the two airlines was reached in the fall of 2008, after AirTran offered, and Delta accepted, an invitation to collude."
The invitation allegedly was extended during an AirTran conference call. AirTran's CEO Robert Fornaro "stated that AirTran wanted to implement a firs- bag fee, that AirTran had invested in the technological capability to quickly implement the fee and that AirTran would implement the fee if Delta acted first," the complaint states.
Nine days later Delta issued a press release, stating the fee would be implemented. The next day, AirTran "issued a public statement that reassured Delta that AirTran would follow through on its promise to match Delta's fee," according to the complaint.
AirTran Holdings is also named as a defendant in this case. The plaintiffs are represented by Cale Conley with Conley Griggs.
What does collude actually mean? I know that the airlines can't act like a cartel and conspire before hand to raise prices or enact fees, but I have never heard the word collude used before.
http://www.courthousenews.com/2009/05/27/Class_Claims_Airlines_Colluded_in_Bag_Fee.htm
Class Claims Airlines Colluded in Bag Fee
By JACQUELINE J. HOLNESS
<script type="text/javascript" src="http://w.sharethis.com/button/sharethis.js#publisher=42240697-4801-421a-9d96-cac79aed84c4&type=website&post_services=facebook%2Cdigg%2Cdelicious%2Cybuzz%2Ctwitter%2Cstumbleupon%2Creddit%2Ctechnorati%2Cmixx%2Cblogger%2Ctypepad%2Cwordpress%2Cgoogle_bmarks%2Cwindows_live%2Cmyspace%2Cfark%2Cbus_exchange%2Cpropeller%2Cnewsvine%2Clinkedin"></script>ShareThis
Before then, "competition between Delta and AirTran prevented either airline from charging a first-bag fee for fear of losing sales to the other," say named plaintiffs Brent Avery and David Watson.
Earlier that year, Delta Air Lines acquired Northwest Airlines, which charges a $15 first-bag fee. Delta then was asked whether it would charge a fee as well to match Northwest's practices. "Considering that AirTran did not impose a similar fee on consumers, Delta stated that it had 'no plans' to charge consumers a first bag fee,'" according to the complaint.
But the class claims "an agreement between the two airlines was reached in the fall of 2008, after AirTran offered, and Delta accepted, an invitation to collude."
The invitation allegedly was extended during an AirTran conference call. AirTran's CEO Robert Fornaro "stated that AirTran wanted to implement a firs- bag fee, that AirTran had invested in the technological capability to quickly implement the fee and that AirTran would implement the fee if Delta acted first," the complaint states.
Nine days later Delta issued a press release, stating the fee would be implemented. The next day, AirTran "issued a public statement that reassured Delta that AirTran would follow through on its promise to match Delta's fee," according to the complaint.
AirTran Holdings is also named as a defendant in this case. The plaintiffs are represented by Cale Conley with Conley Griggs.
What does collude actually mean? I know that the airlines can't act like a cartel and conspire before hand to raise prices or enact fees, but I have never heard the word collude used before.
anic: