American Airlines sues online giant Orbitz

Discussion in 'American Airlines | AAdvantage' started by AmericanGirl, Apr 15, 2011.  |  Print Topic

  1. AmericanGirl
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    AmericanGirl Silver Member

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    http://travel.usatoday.com/flights/...aycomTravel-TopStories+(Travel+-+Top+Stories)

    USA Today: Click link for full story

    The nation’s third-biggest airline has filed suit against Orbitz Worldwide, the second-biggest online travel site, and Travelport, the company behind Orbitz’s reservation system, saying they’ve taken “unprecedented” steps to discourage use of American’s preferred direct booking pipeline.

    What American is trying to do is improve the way that we distribute our products to travel agents,” says Bruce Wark, associate general counsel for AMR, parent of American Airlines. “This lawsuit seeks to remove the barriers that our initiatives have faced, that have been erected by … Travelport in particular, to prevent new technologies from entering the marketplace.”
    ...

    The antitrust lawsuit, filed Tuesday in the U.S. District Court for the Northern District of Texas, seeks money damages and an injunction to stop what American calls “anti-competitive” actions taken by Orbitz and Travelport.
     
  2. gleff
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    gleff Co-founder

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    Seems to me they ought to just negotiate this, American means to capture additional value out of the changes and they want to do business with Orbitz so they can either negoitate with Orbitz and allow Orbitz to share in the additional value created through use of American's platform or adapting to it while selling to Orbitz's customers... or they can sue and get the government to try to force Orbitz to go along and let American keep all the revenue from the changes.

    Clearly American prefers to use lawyers, which isn't new, they used lawyers to delay the launch of Southwest Airlines at Dallas Love Field... (and they used lobbyists to prevent the expansion of Southwest at Love Field). And they used lawyers to squash Legend Airlines.

    Why shouldn't they use lawyers to try to get the outcome they want instead of using voluntary agreements between parties? If we have a government that we allow to become their tool, it makes perfect sense for them to avail themselves of it I suppose.:(

    Anti-trust laws (whether American has a case here or not, on which I express no opinion on current case law on the subject) are ofen a form of corproate welfare, to accomplish via the courts what one cannot or wishes not to accomplish through competition and voluntary contract.
     
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  3. miamigrad
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    miamigrad Silver Member

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    Either American or the GDS operator(s) will ultimately flinch. In the end (however long the "end" will take), the relationship between the two will change. It should be an interesting show.... grab the popcorn!
     
  4. Travel2Food
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    Travel2Food Silver Member

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    Strikes me that this is a ploy to force Orbitz to the bargaining table. Given that the online ticket sales market is quite competitive, I don't think that AA can make an antitrust argument. I'm not sure the law compels Orbitz to carry any company that they choose not to carry, just as AA is not compelled to sell through every possible agent/outlet.

    Given the recent settlement and the fact that AA filed a lawsuit, it strikes me that terminating those outlets must have hurt AA more than it hurt the ticket sellers. Otherwise, there's no real reason to sue. I could be wrong, however....
     
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  5. DestinationDavid
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    DestinationDavid Milepoint Guide

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    Agreed. This feud between AA and Orbitz has been going on awhile. AA and Expedia/Hotwire started just before Orbitz, and AA was able to settle with the others. AA didn't start with the lawyers, there's been a few months now that I'm assuming involved negotiating between AA and Orbitz, and this is just AA taking it's next "step".

    As miamigrad says, grab your popcorn!
     
  6. JohnDeere19
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    JohnDeere19 Gold Member

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    This has settlement written all over it.
     
  7. DestinationDavid
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