Air Freight News

American Airlines says Sabre had monopoly in reservations market

A lawyer for American Airlines Group Inc. urged a jury to award the carrier almost $300 million in overcharges and lost profits, arguing that Sabre Holdings Corp. illegally dominated the market for booking airline tickets.

“There’s one company in this travel business that doesn’t compete,” Paul Yetter told the jurors at the end of a three-week federal trial in Manhattan. “And it’s Sabre.”

Yetter told the panel that Sabre protected its monopoly position by locking up travel agents, tying up the airlines and killing off new competition. American claims it is owed $299.3 million on behalf of US Airways Group Inc., with which it merged in 2013. If it succeeds, it could collect almost $900 million under US antitrust laws, which provide for triple damages.

“The benefits that they’ve gotten from that economic power is high prices, extraordinary profits, and that’s harmed US Airways,” Yetter said.

US Airways sued Sabre in 2011 claiming it charged inflated fees for its computerized reservation services. It alleged that a contract it signed with Sabre illegally reduced competition. It says no competitor in more than 30 years has entered the market to provide a computerized platform to connect airlines and other travel companies to travel agents.

Sabre says it acted lawfully and fairly in a competitive marketplace.

“My client’s being sued for a lot of money,” Patrick Fitzgerald, a lawyer for Sabre, told the jury when it was time for his own closing argument. “People want to take it to the cleaners for a contract that was freely negotiated and performed.”

Fitzgerald told the jurors American had failed to show that Sabre monopolized the market, and that prices went down during the period covered by the suit. He said US Airways hadn’t suffered any antitrust injury.

US Airways won a $5.1 million award in 2016 that was tripled to $15.3 million. That verdict was thrown out in 2019 and sent back for a new trial.

The case is US Airways v. Sabre Holdings, 11-cv-02725, US District Court, Southern District of New York (Manhattan).

Bloomberg
Bloomberg

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© Bloomberg
The author’s opinion are not necessarily the opinions of the American Journal of Transportation (AJOT).

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