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BA and Virgin Long-Haul Passengers Finally Set for Price-Fixing Refund

Thousands of long-haul passengers affected by price-fixing by British Airways and Virgin Atlantic are finally set for a refund after three individuals dropped a challenge to a £73.5 million settlement agreed by the airlines with class action lawyers.

More than 100,000 UK businesses and individuals are set to receive a share of the payout under a deal struck in February 2008. However, payment of the refunds, due to begin at the end of last year, was delayed because of a legal challenge by three passengers who argued that an American court should not have jurisdiction over British claims.

Today Hausfeld & Co, one of the two US law firms that brought the case, said that an agreement had been reached with the objecting passengers and that the refunds could now proceed.

Michael Hausfeld, chairman of the firm, said: “Whilst disappointed that this unprecedented objection had been raised in the first place, we are pleased that a settlement has now been reached with the objectors meaning that refunds will now be processed promptly.”

Around 5.6 million British passengers are believed to have been affected by collusion between the airlines on the price of fuel surcharges on long-haul flights between August 2004 and January 2006. To date, around 100,000 British businesses and individuals have come forward to claim a refund, Hausfeld & Co said.

Those who have not yet claimed a refund have until December 2012 to do so. The refund amounts to around £13 per ticket.

The case was brought after BA was fined £121.5 million by the Office of Fair Trading, Britain’s competition watchdog, and $300 million by the US Department of Justice.

Virgin Atlantic escaped financial punishment because it blew the whistle on the price-fixing.
 

Practice Areas: Antitrust / Competition