Bloomberg News

China Air Reaches $90 Million Accord in Cargo Antitrust Case

May 08, 2014

China Airlines Ltd. (2610) agreed to pay $90 million to settle a lawsuit that claimed it conspired to fix prices on air cargo shipments, following 21 earlier settlements by other airlines.

The shipping customers who brought the suit asked a federal judge in Brooklyn, New York, yesterday to approve the latest settlement in a case initially brought against more than two dozen carriers worldwide.

The accord with Taoyuan, Taiwan-based China Airlines brings the total value of the settlements in the cases to more than $835 million, lawyers for the customers said.

The latest agreement “brings additional compensation to the many thousands of businesses harmed by this global conspiracy to inflate prices for air-shipping services,” Hollis Salzman, co-lead counsel for the plaintiffs, said in a statement.

In separate criminal probes, 21 air cargo carriers have pleaded guilty to participating in the conspiracy and agreed to criminal fines of more than $1.8 billion, according to the plaintiffs.

Claims in the civil lawsuit in Brooklyn remain outstanding against seven airlines including Air China Ltd. (601111), Air India Ltd., Eva Airways Corp. (2618), Asiana Airlines Inc., Air New Zealand (AIR) Ltd., Nippon Cargo Airlines Co. and Atlas Air Worldwide Holdings Inc. (AAWW:US)’s Polar Air Cargo, Salzman said.

Roscoe Howard, a lawyer for Air New Zealand, declined to comment on the case. Lawyers for the other airlines didn’t immediately return calls seeking comment.

Previous Accords

Previous accords involved airlines including Lufthansa Cargo AG, Societe Air France, Qantas Airways Ltd. and British Airways Plc, according to settlement filings. Of the previous settlements, 18 have received final approval from a judge, according to court documents. Three have received preliminary approval, the complainants said.

Shipping customers sued the airlines in 2006 alleging that they were fixing prices through surcharges related to fuel costs and security following the Sept. 11, 2001, terrorist attacks in the U.S.

In addition to paying $90 million, China Airlines will provide $200,000 for settlement notice and administration costs and will cooperate in the case against the remaining companies, the complainants said.

The case is In Re Air Cargo Shipping Services Antitrust Litigation, 06-md-1775, U.S. District Court, Eastern District of New York (Brooklyn).

To contact the reporter on this story: Christie Smythe in Brooklyn at csmythe1@bloomberg.net

To contact the editors responsible for this story: Michael Hytha at mhytha@bloomberg.net Joe Schneider, Fred Strasser


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