Last remaining airlines settle price-fixing case, ending decade-long legal saga

One of the longest, costliest, and most embarrassing chapters in the global air cargo industry's history has come to an end.

Air New Zealand Ltd. and Air India Ltd. became the final two airlines to settle out of court over civil allegations they were part of a worldwide conspiracy to fix prices on shipments moving to and from the U.S. from January 2000 to September 2006, according to a statement today from attorneys representing the plaintiffs' class. Air New Zealand agreed to pay $35 million, while Air India will pay $12.5 million, according to the statement.

The settlements, once approved by a federal district court in New York, draw a 10-year legal battle to a close. It also avoids a showdown in federal court, where the case was scheduled to go to trial this September.

The suit, brought in February 2006 by users of air cargo services, alleged that multiple carriers, acting like a cartel, conspired to deliberately inflate cargo prices during the 2000-06 period. The Airlines were accused of coordinating the imposition of fuel and security surcharges, and of agreeing to eliminate or prevent discounting of surcharges.

About three dozen airlines were named in the suit, among them some of the world's most prominent carriers. All told, carriers agreed to more than $1.2 billion in settlements. Earlier this year, U.S.-based carrier Polar Air Cargo and its majority shareholder, Atlas Air Worldwide Holdings Inc., agreed to pay $100 million over three years to settle the allegations. Air China Ltd. followed suit, leaving Air New Zealand and Air India as the only remaining defendants.

In criminal antitrust probes running parallel to the civil case, 21 different air cargo providers have pleaded guilty and agreed to criminal fines of more than $1.8 billion, the statement said.