Bruce Barnard | Jul 23, 2010 10:50AM EDT
British Airways started legal action against more than 30 airlines in a bid to get them to share damages it may have to pay shippers arising from an international price fixing cargo cartel.
Some 250 shippers are suing BA, Europe’s third largest scheduled cargo airline, after it pleaded guilty in the U.S. to participating in a worldwide cargo cartel between 2000 and 2006.
The carrier issued so-called Part 20 proceedings, to enjoin other alleged co-conspirators, including Air France-KLM, Lufthansa and Cathay Pacific, in the shippers’ lawsuits.
This would allow BA to seek compensation from rival carriers if it has to pay damages to shippers.
“We will continue to contest any class actions brought by cargo customers,” BA said in a statement.
Two small flower producers, Emerald Supplies and Southern Glass House Produce, initially brought the law suit. But many major cargo shippers, including French tire manufacturer Michelin, Swedish furniture group Ikea and electronics giant Ericsson, are reported to have joined the suit.
The London High Court rejected BA’s case, but it is now being assessed by the Court of Appeal.
BA settled the cargo and passenger price fixing claims with the U.S. Department of Justice in 2007 and paid a fine of $300 million. BA was also fined $185 million by the UK’s Office of Fair Trading.
Earlier this month, Air France-KLM , and its Dutch subsidiary Martinair, agreed to pay $87 million to settle claims for civil damages arising from the cargo cartel.
In 2008, the Franco-Dutch carrier, pleaded guilty to cartel charges in the U.S. and paid a fine of $350 million.
The European Union is close to completing an investigation into the alleged cargo cartel but is reportedly uncertain about potential fines because of the financial crisis in the global airline industry.
-- Contact Bruce Barnard at brucebarnard47@hotmail.com.
