British Airways and LAN Airlines reach settlements in civil case
British Airways has reached a settlement in its civil suit
British Airways and LAN Airlines have reached settlements in a class-action lawsuit brought by Hausfeld LLP against 42 airlines that originated as a result of the U.S. Department of Justice's (DOJ) ongoing price-fixing investigations. British Airways agreed to pay more than $89 million. LAN Cargo, LAN Airlines and the company's affiliate in Brazil, Aerolinhas Brasileiras S.A., settled for a total of $66 million.
With these latest agreements, 11 of the 42 airlines have settled for a total of more than $433 million. Air France-KLM/Martinair and Lufthansa have paid out some of the heftiest fees associated with the class-action suit, doling out $87 and $85 million, respectively. On the other end of the spectrum, American Airlines paid out $5 million in July 2010, and Thai Airways settled for $3.5 million.
For their part, officials at LAN have seen that a problem exists at the company and are working to fix it.
"As part of its permanent commitment to good corporate governance and transparency in its corporate actions, LAN has further reinforced the control mechanisms of its strict compliance program," a spokesman wrote in a news release. "Furthermore, the company has implemented a new code of conduct that will govern all of its employees worldwide."
Michael Hausfeld, chairman on Hausfeld LLP, pointed out that even though the latest settlements represent a big piece of the lawsuit, there is still a long road ahead for claimants. Hausfeld — along with the firms of Labaton Sucharow; Levin, Fishbein, Savran & Berman; and Kaplan Fox & Kilsheimer — is representing clients harmed by the carriers. Hausfeld's UK office is gathering claimants for a civil suit against carriers fined by the European Commission in 2010.
“These two important settlements, returning over $150 million to claimants, represent yet another excellent result for the U.S. class, which is fast approaching half a billion dollars in recoveries from settling defendants," the firm's chairman, Michael Hausfeld, said in a statement. "BA and LAN/ABSA have now taken an important step toward paying damages for their admitted price-fixing conduct. We will continue our efforts to pursue recoveries for the huge number of victims of this cartel both in the U.S. and around the world. It is long overdue that the companies found to have engaged in price-fixing by public enforcement agencies make restitution to all of their victims, everywhere in the world.”
The DOJ hasn't ended its investigation, either. Just last month, EVA Airways pleaded guilty to price fixing and agreed to pay a $13.2 million fine.
