United and American Reach Settlements in Air Cargo Class-Action Lawsuit

United Airlines and American Airlines disclosed settlements Wednesday in a class-action lawsuit stemming from an investigation into alleged price collusion among carriers in the air cargo industry.

Unlike Lufthansa AG, which said Monday it would pay $85 million (euro67.05 million) to settle pending lawsuits in the case, both U.S. carriers said they are not required to make any payments.

The settlements could close the books on their obligations in the case barring further findings. Officials at both American and United, the largest two U.S. airlines, said that if the Justice Department later brings charges against them as a result of its investigation, the settlements would be off.

More than a dozen airlines have been the subject of an investigation initiated by U.S. and European Union officials into suspected price-fixing in the air cargo industry on surcharges for fuel, security and insurance.

Investigators were quoted earlier this year as saying the surcharges apparently originated among European carriers, with U.S. companies then setting their own charges in line with competitors. For carriers to be hit with criminal charges, prosecutors would have to show they were actively conspiring, not just following others' price increases.

Justice Department spokesman Gina Tallamona said the investigation is ongoing but declined to give details.

Tim Smith, a spokesman for Fort Worth, Texas-based American, a unit of AMR Corp., said the carrier had been swept into an investigation that appeared centered on European airlines.

"We do have a settlement with some of the plaintiffs, subject to court approval," he said. "It requires no payment at all by American, and we have been told we are not a target of the investigation."

American would not be forced to change its cargo-pricing policies, Smith said. As part of the settlement, it promised to provide information to the shippers who filed the suits.

United, a unit of UAL Corp., pledged to continue to cooperate with the plaintiffs as part of the agreement.

"We are pleased to have reached an agreement with a majority of plaintiffs that will see us dismissed from the civil litigation, pending court approval," said spokesman Brandon Borrman of Elk Grove Village, Ilinois.-based United, the No. 2 U.S. carrier.

The Financial Times reported Wednesday that Virgin Atlantic Airways also had reached a settlement in the case. The London-based carrier did not respond to a telephone message.

The overall settlement could cost the involved airlines more than $1 billion (euro790 million), according to the newspaper, citing attorneys for the plaintiffs.

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AP Business Writer David Koenig in Dallas contributed to this report


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