Pair of Lawsuits Target Airlines

Hidden-city ticketing case gets class action status; commission loss suit seeks same

Two more lawsuits against the airlines are moving forward in Michigan and New York courts.

A lawsuit accusing Northwest, Delta and US Airways of overcharging passengers by prohibiting hidden-city ticketing was approved to proceed as a class action by a three-judge panel of the U.S. Sixth Circuit Court of Appeals in Detroit. The ruling upheld an earlier decision by the U.S. District Court for the Eastern District of Michigan to certify the lawsuit.

Attorneys Nelson Chase and Norman Volk filed the suit in 1996. They claimed the airlines violated federal antitrust laws by prohibiting hidden-city ticketing. They are seeking $1 billion in damages.

Meanwhile, a New York agency, Power Travel International of Plainview, charged American, Continental, Delta, United and Northwest with breach of contract in connection with the elimination of commissions last March. The carriers also breached an implied covenant of good faith and fair dealings when they dropped base pay to zero and did not give reasonable advance notice, the complaint said.

The agency is seeking to recover commissions and other financial losses incurred because of the last no-notice commission cut, but attorneys for Power Travel said it is arguable the carriers had no right to eliminate travel agency commissions unilaterally, with or without notice.

The agency said it would seek class-action status for the suit.

Meanwhile, the airlines named in the suit filed motions in the U.S. District Court for the Southern District of New York to dismiss it.