Southwest Airlines to pay $15 million to settle price fixing charges
January 04, 2018
Southwest Airlines agreed to pay $15 million Wednesday to settle allegations that the four largest airlines in the United States colluded to keep airline fares high.
While the airline said it admitted no wrongdoing but wanted to avoid continued legal expenses, Delta, United, and American airlines said they would continue to fight the lawsuits, which were filed by passengers.
The charges were made in 23 antitrust lawsuits that were consolidated and tried in federal court. The lawsuits allege that, beginning in 2009, the four airlines conspired to limit the number of new seats they added to raise airfares despite lower fuel costs.
Sen. Richard Blumenthal, D-Conn., said he was glad Southwest accepted the penalty and agreed to cooperate in efforts to address airline collusion.
“All airlines must be held accountable for anti-competitive practices, and DOT and Congress must reaffirm commitment to protecting consumers,” Blumenthal said in a Tweet. “This penalty shows why we need a Passenger Bill of Rights, as I've advocated, to hold airlines accountable for blatant abuse.”
In 2015, he called for the U.S. Department of Justice to investigate the airlines following a report they took part in a meeting in which they publicly discussed their strategies for remaining “disciplined” in their decisions to manage capacity across their flight routes.
The department has asked for information from the four airlines, but hasn’t taken any action against them for price fixing.
Preliminary approval to the settlement was given by judge Colleen Kollar-Kotelly of the federal court of the District of Columbia. Airline passengers will be able to give their comments before the order is finalized.
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