The European Shippers' Council on Thursday said it has joined the class action in ongoing litigation against air carriers accused of engaging in a price-fixing scheme.
The class action was started some two years ago in the U.S. by a number of airfreight customers against a group of flagship airlines for what they alleged was a violation of U.S. and EU competition laws. The complaint alleged that those airlines conspired to fix prices on costs associated with airfreight worldwide.
If the class action is successful, it would allow buyers of airfreight services to recover compensation from the airline cartel.
The ESC said it decided to join the class action in order to help those European shippers that believe they have a valid claim against the airlines that have allegedly or already proven to have participated in the price-fixing activities.
"The effect of the surcharges illegally agreed and set by some airlines has been to artificially inflate cargo shipment prices to the benefit of those cartel members and to the detriment of the customer which is in clear violation of the law," ESC Secretary General Nicolette van der Jagt said in a statement.
She said the ESC will be communicating to shippers via their representative shippers' councils if they wish to make a claim and to submit their evidence to the ESC in confidence.
The ESC will make this evidence available to the legal counsel handling the case in order to assist the court in determining the appropriate scale and level of damages to be awarded, or alternatively that might be required in any potential out-of-court settlement by those airlines on which the court has not yet ruled.
Class-action proceedings in the United States began in early 2006 against airlines that are alleged to have begun price fixing as early as 2000 with fuel surcharges and after Sept. 11, 2001 with security surcharges, and later still with a war-risk surcharge. The cartel member carriers charged their customers' surcharges calculated in nearly identical ways, thus eliminating competition between them.
Lufthansa has filed for amnesty in the U.S. class actions. It has agreed to an $85 million settlement with the U.S. to cover claims made against it.
It was reported this week that Cargolux has made a $154.9 million provision against potential fines arising from its alleged involvement in a price-fixing. British Airways pleaded guilty and was sentenced to pay a $300 million; Korean Air pleaded guilty and was sentenced to pay a $300 million criminal fine; Qantas Airways pleaded guilty and was sentenced to pay a $61 million criminal fine. Investigations continue in respect of an undisclosed number of other airlines.
The European Commission also is investigating the alleged cooperation.
Peter T. Leach/The JOURNAL of COMMERCE ONLINE
