Price Fixing by United Airways and Virgin Atlantic

planeAugust 8, 2006, Green & Noblin, P.C. filed an antitrust class action against United Airlines, Inc.; British Airways, PLC; and Virgin Atlantic Airways Limited seeking damages on behalf of all individuals victimized by price fixing on air passenger tickets for international flights, such as trips between London’s Heathrow Airport and U.S. airports such as San Francisco International, Los Angeles International, New York’s LaGuardia International or Chicago’s O’Hare International. The complaint alleges that starting in 2004, the airlines conspired to set and artificially raise certain fees such as surcharges for fuel.

Green & Noblin, P.C.’s lawsuit alleges that United Airlines, British Airways and Virgin Atlantic colluded and conspired to uniformly set and raise certain surcharges to avoid competitive pricing. Seeking to soften the blow of market driven competition for passenger business, the airlines are using the guise of rising oil prices to mask a price fixing scheme for fuel surcharges; however, the relationship between increasing fuel costs and the airlines’ fuel surcharges is tenuous. Green & Noblin, P.C.’s lawsuit alleges that the airlines’ uniform fuel surcharges and lockstep raises do not reflect the airlines’ actual fuel costs per flight because each airline has a different purchasing strategy for fuel.

British Airways first began charging airline passengers a fuel surcharge in 2004, and shortly thereafter other airlines such as United Airlines and Virgin Atlantic implemented a similar fee. Since the implementation, the airlines have exhibited a pattern of raising the fees in lockstep, but out of synch with their actual fuel costs. For example, in April 2006, British Airways increased its fuel surcharges for long-haul flights by as much as $64 on each one way ticket. At about the same time, Virgin Atlantic began charging $64 for each one way ticket. Although United’s fuel surcharges vary by flight and from day to day, the surcharge on a one-way ticket between New York and London, a route serviced by British Airways and Virgin Atlantic, is about $67.

The airlines’ illegal activity is believed to target individuals and corporations purchasing one-way or round trip tickets for flights primarily between London’s Heathrow Airport and cities in the United States such as New York, Chicago, Los Angeles or San Francisco, but may exist for other long haul flights as well. The allegations of illegal price fixing are also being investigated by U.S. Department of Justice and the United Kingdom’s Office of Fair Trading.

If you purchased a one-way or round trip ticket for an international flight and believe you were a victim of this cartel, please call Green & Noblin, P.C., at (415) 477-6700 or by clicking here to discuss your rights.