RALEIGH, N.C. -- Will the apparent demise of the Sarah Hall
class-action suit have any impact on other travel agent suits
against the airlines?
Clearly, a defeat could deter agents from filing such suits in
the future, but it's not so clear that the action in the Hall case
in North Carolina will have any direct effect on other litigation
already under way elsewhere.
Currently, the only U.S. class action still standing is a case
brought by Plainview, N.Y.'s Power Travel, which, unlike other
cases, does not allege collusion on the part of the carriers.
Rather, the case, launched in mid-2002, argues the airlines had
no right under their ARC agreements to eliminate base
commissions.
Responding to a motion for summary judgment, New York U.S.
District Court Judge Robert Sweet said the existence of commissions
"is an implied term" of ARC's agency contract, and so, by paying
zero commission rather than some commission, however small, the
defendant carriers "are not in good-faith compliance" with the ARC
contract.
Ira Schochet, Power Travel's attorney, said the Hall decision
"is irrelevant to our case. It will have no adverse impact ... . We
aim to proceed to collect for all class members [monies owed] due
to a breach of contract."
Three separate lawsuits -- in California, Ohio and Texas -- were
filed this year on behalf of a total of about 150 travel agencies
as individual plaintiffs, not as class actions. Each of the suits
alleges collusion by airlines.
The Texas case, filed this summer with Swope Travel of Beaumont,
Texas, as lead plaintiff, names Orbitz as a defendant, as well as
American, Continental and Delta.
At the time of filing suit, Max Blecher, attorney for the 71
plaintiffs, said the case is unique in that "we say the creation of
Orbitz is an agreement to control the ticketing of air
transportation and to channel it to the Internet, to the detriment
of agents."
After the Hall decision, Swope attorney Rob Noblin said, "We
don't believe this will have a fundamental impact" because "we are
proceeding on a different theory of liability ... . The main focus
is on Orbitz, so it is still full steam ahead."
As for the Ohio lawsuit, launched this spring by 30 agents,
attorney Harvey Bruner said, "I do not believe the Hall case will
have a negative impact on our matter."
"Our case is not a class action and will depend on the discovery
process."
Last year agency trade group Canadian Travel Agent Registry
Standard (Cstar) and two agencies launched a suit in Canada
somewhat parallel to the Sarah Hall case, but the impact of the
North Carolina court move will be "negligible" north of the border,
said Bruce Bishins, president of the Cstar group.
You can reach the journalist who wrote this article at [email protected].