U.S. law firm O’Melveny & Myers filed a lawsuit on behalf of American Airlines on Friday, saying the Texas-based global distribution system should pay American’s fees.
Those fees could amount to at least tens of millions of dollars. The 11-year litigation included two trials and an appeal. The filing did not identify an amount, but a O’Melveny partner previously said in court that the fees were “very, very substantial.”
American Airlines was awarded $1 in May as the winner of an antitrust trial against Sabre.
The dispute was over practices Sabre used to force airlines to use its services, and prevent carriers from reaching out to travel agents and business travelers more directly. American inherited the case when it acquired US Airways in 2013. US Airways had sued Sabre in 2011.
The result in May found that Sabre’s practices did not cause American Airlines any financial harm.
Friday’s filing shows that the two companies tried to resolve the fee dispute without involving the court but did not reach an agreement.
Surf Air Mobility plans to list directly on public markets in the U.S. after ending a planned $1.4 billion special purpose acquisition company, or SPAC, listing.
The California-based aviation company still plans to merge with regional airline Southern Airways Express as part of an initial public officer (IPO), Southern CEO Stan Little confirmed. Surf Air Mobility did not say when it planned to list but has filed a confidential registration statement, or S-1, with the Securities and Exchange Commission.
Surf Air and Southern plan to use their merger to accelerate the introduction of hybrid-electric passenger aircraft. Little has previously said that the combination would provide the capital it needs to take delivery of 100 Cessna Caravans from manufacturer Textron, and convert them to hybrid-electric propulsion beginning in the 2024-25 timeframe.
In May, Surf Air Mobility unveiled plans to list via a $1.4 billion SPAC deal with blank-check company Tuscan Holdings. The two companies mutually terminated that agreement on November 14, with Surf granting Tuscan 600,000 shares plus a termination payment of either 35,000 more shares or $700,000 in cash. Tuscan will liquidate following the end of the merger agreement.
Rising airfares and travel costs are prompting legal professionals involved in dispute resolutions to return to video conferencing.
That’s according to a National Law Review article, which has highlighted how virtual proceedings are coming back after being used during the pandemic. International arbitration centers and courts became comfortable with the virtual format during lockdowns, with protocols developed and vetted, the article said.
“Virtual hearings save money (and they’re here to stay,)” argues IMS Consulting & Expert Services, in its opinion piece titled “Global Dispute Resolution: The Future of Virtual Legal Proceedings Is Shaped by Soaring Travel Costs.”
“International travel is expensive, and the virtual option means that it is no longer necessary to count travel as a ‘cost of doing business’ when pursuing an international dispute,” it said.
It’s a compelling cost saver for all parties, it argues — and the consultancy says it’s run the numbers.
International Business Travel Expenses & Travel Time to London for One Legal Proceeding
Source: National Law Review
It’s compared costs for in-person attendance, with the example of a business travel cost profile for an international arbitration hearing taking place in London and involving three U.S. attorneys, two Paris attorneys, two local witnesses, and three litigation support personnel.
The average business trip to London is 5.8 days, during which these travelers will require accommodations for 5 nights, food for 6 days, and ground transportation for 6 days.
“The cost of travel time can be as much or more than the cost of flights to attend an international arbitration or other legal hearing,” the articles states. “Spending many hours traveling to and returning from the various steps of an international proceeding is not only an expense for a client, but productivity is also lost for the legal professionals involved.”
How many other industries will be considering similar number-crunching exercises?
JetBlue Airways will land on the European continent next summer with new flights to Paris.
The New York-based carrier will first connect its New York JFK base to Paris’ Charles de Gaulle airport, with additional nonstop flights from Boston planned in the future. The addition of the City of Lights to JetBlue’s map will come two years after it entered the transatlantic market with service to London in August 2021.
As with JetBlue’s entrance on the crowded New York-London route, the airline hopes to similarly disrupt the New York-Paris market by offering a more affordable premium option with its lie-flat Mint business class product. But Paris is different than London, La Compagnie already offers a more affordable premium product between Newark and Paris Orly; an option that was not available in the New York-London market. JetBlue also faces competition from Air France, American Airlines, Delta Air Lines, French Bee, and United Airlines, Diio by Cirium schedule data show.
“So far, it has been fantastic,” JetBlue President Joanna Geraghty said of the airline’s London flights at the Skift Global Forum in September. “Load factors have been through the roof, and I’d say it’s pretty tough to get a Mint seat flying across the pond.”
Competition won’t be JetBlue’s only challenge on its new Paris route. Production issues at planemaker Airbus have delayed the delivery of new A321LR aircraft that the airline needs for its transatlantic routes. The situation forced JetBlue to fly less optimized aircraft on select London flights this summer and fall.
It’s not often that travelers have something to look forward to at Newark Liberty International Airport. The new $2.7 billion Terminal A will open in December, the latest in a series of major airport projects opening around the U.S. this year.
The first 21 gates of the 33-gate facility will open on December 8, officials said Tuesday. The remaining gates open in 2023. Air Canada, American Airlines, JetBlue Airways, and United Airlines will operate from the terminal initially, and Delta Air Lines will join them next year. The old Terminal A, which opened in 1973, will be demolished.
The last new terminal to open at Newark airport was Terminal C in 1988.
United, which has a large hub at Newark, will use up to 15 gates in the new Terminal A. The airline plans to operate flights to around 23 destinations — including to Atlanta, Austin, Dallas-Fort Worth, Nashville, Raleigh-Durham, San Diego, and Seattle-Tacoma — from the facility, Newark Chief Pilot Captain Fabian Garcia said in September.
The new terminal at Newark is the latest in a series of big airport investments around the U.S. this year. New or expanded facilities at Denver, Los Angeles, New York LaGuardia, Orlando, Phoenix Sky Harbor, Seattle-Tacoma, and Washington Dulles airports have all opened in recent months.
Construction of Terminal A at Newark began in 2018.
Sam Gilliland, who was the CEO of Sabre Corporation for 10 years, is taking the top role at Accelya.
The Spanish company, which makes software for the airline industry, said Monday that Gilliland has been hired as CEO. Gilliland replaces Jim Davidson, who is stepping into the role of vice chairman.
Accelya was acquired in 2019 by Vista Equity Partners, a software investment fund. Through that investment, Accelya bought Farelogix in 2020. Accelya has more than 250 airline clients and nearly 2,500 employees.
Most recently, Gilliland was the CEO of Cherwell Software, a Colorado company owned by Ivanti that makes information technology software for corporations.
Gilliland had spent 25 years at Sabre, starting as a software engineer. He was named chairman and CEO of Sabre in 2003 and exited in the role in 2013. Skift had named him one of the highest paid executives in travel while he was there. He had led more than 10,000 employees in 60 countries.
Cathay Pacific Airways, after worries that Hong Kong’s strict Covid rules could doom the airline, is beginning its post-pandemic bounce back as the Chinese special administrative region eases its border rules.
The Oneworld alliance carrier will resume a third of its 2019 capacity by the end of the year, Cathay said Monday. That means resuming about 3,000 daily flights between the end of October and year end. And, as travel is expected to surge back, 70 percent of its pre-crisis capacity by the end of 2023. The carrier anticipates a full recovery to 2019 levels in 2024.
“Our recovery trajectory is in line with other carriers that don’t benefit from a domestic market in terms of the time taken since borders began to open,” Cathay CEO Augustus Tang said. He added, citing the recovery challenges other airlines have experienced, that Cathay has “sufficient pilots, cabin crew and operational employees” to support its capacity recovery plans.
Cathay will return to Bali, Bangalore, Fukuoka, Sapporo, Tokyo Haneda, Xi’an, and Zurich, and add back flights in other markets, in the fourth quarter, according to Diio by Cirium schedules.
Swiss Air flyers will soon be able to connect to Interlaken and Lucerne on a single ticket. The airline will expand its “Air Rail” partnership with Swiss Federal Railways (SBB) to the two famed destinations in Switzerland from December 11.
The expansion comes as airlines as increasingly relying on rail partners for local, or regional, connections on the ground. This is especially popular in Europe where many major airports have intercity rail stations, including Amsterdam, Frankfurt, and Paris Charles de Gaulle. And, in July, German rail operator Deutsche Bahn unveiled plans to join the airline confab, Star Alliance, as its first intermodal partner.
But for all the fanfare given these partnerships, many hurdles remain. A lack of signage at Paris’ Charles de Gaulle airport adds an unnecessary layer of difficulty to flight-train transfers. Elsewhere, airline executives speak of issues integrating reservations systems and other technology challenges. And then there is the simple challenge of physical infrastructure: Trains can only go where tracks exist.
The expanded Swiss and SBB partnership includes a new direct train — no transfer required — between Interlaken and the Zurich Airport. The airline touts “seamless” connectivity under the pact, including the ability of travelers to check in once — for example, on the Swiss app — and receive boarding passes for both the air and rail portion of their trips. Travelers can also earn points in Swiss’ loyalty program for the rail portion of their trips.
The General Directorate of Consumer Affairs of the Balearic Islands, which include Mallorca and Ibiza among the better-known islands in the archipelago, levied the fine against eDreams Odigeo based on consumer complaints, finding that the Spain-based online travel company enticed travelers to book discounted flights, for example, but didn’t show prominently enough online that they would also be charged a roughly 55 euro ($53) annual fee for activation of the company’s subscription service, according to multiple published reports.
Edreams Odigeo announced in August that Prime attracted 3.5 million subscribers, after notching its largest ever quarterly growth in April, May and June, namely 560,000 paying members.
The amount of the fine, $23,000-plus is a tiny for eDreams Odigeo from a financial perspective — the company claims to be the #2 flight online travel agency in the world behind Trip.com Group in China — is inconsequential. But the hit to eDreams Odigeo’s brand reputation, which had some trying times several years ago, could be more significant.
The company’a brands include eDreams, Opodo, and GoVoyages, among others.
An eDreams Odigeo spokesperson commented on the regulatory action.
“The resolution proposal by the Balearic consumer authority is not final and we respectfully disagree with it,” the eDreams Odigeo spokesperson said. “Our subscription programme, Prime, is exclusively offered to consumers as an optional service. Users must expressly opt-in to enroll on the programme after confirming they have read the terms and conditions. All the details of the subscription are displayed clearly and upfront, ensuring that no customer joins the programme unknowingly.
“For further transparency, we offer a free trial period to allow consumers to enjoy the benefits of the service at no cost for 30 days. Furthermore, all customers who decide to join the free trial receive an email confirmation that clearly informs them of their subscription and how to easily cancel it online at any time before any charge is made, should they wish to.”
Janis Dzenis, a spokesperson for WayAway, a recently launched travel price comparison service that operates a subscription plan in the U.S., reacted to the news, arguing that such services need to be up-front with travelers.
“One hundred percent transparency about what the consumer is signing up for is a must for us,” Dzenis said. “Subscriptions are a long-term business play and unsatisfied customers could jeopardise your brand. By all means show people a ‘if you were a subscriber you’d get xx percent off this flight’ option, but it has to be completely clear. No surprises.”
The consumer affairs unit of the Balearic Islands, which is an autonomous province of Spain, likewise proposed a euro 24,000 fine against Spanish low-cost-carrier Volotea on similar lack of transparency grounds in inducing sign-ups for its own subscription plan.
“In the case of Volotea, the Consumer Affairs Directorate of Baleares points out that, when simulating buying a ticket for the Menorca-Asturias route, a discount of just over five euros was offered, but at the same time a subscription to the Megavolotea Plan was activated, with a cost of almost 50 euros per year. In the case of eDreams, different discounts entailed the activation of the Prime service, with a cost of 55 euros,” Facua reported.
The consumer affairs agency considers the case against the airline as being in its preliminary stages, and the proceeding against eDreams Odigeo resolved.
Google announced it will shut Book on Google for flights for users outside the U.S. at the end of September, and told Skift it will likewise end the feature in the U.S. sometime after March 31.
It turns out, a declining number of users were booking their flights on Google, which acknowledged that travelers would rather book their flights with online travel agencies or directly with airlines.
To be clear, Google Flights is not shutting down, but will continue to enable travelers to click on airline and online travel agency links to book their flights, as they have done for years for the vast majority of flights. What changes is that Google will no longer take a small share of bookings on Google channels, but will refer all users to partners for bookings.
Eliminating the feature likewise doesn’t hurt Google’s case to beat back regulatory efforts to diminish its power on antitrust grounds.
With the Book on Google feature for flights, travelers can book on Google, but Google was just facilitating the booking for that airline or online travel agency, and the latter provided the customer service function. Google wasn’t charging airlines for the feature.
“Over the next 12 months, we plan to phase out the Book on Google feature for Flights,” Google stated. “We originally offered this functionality to give people a simpler way to buy their tickets and to help our partner airlines and OTAs receive more bookings. However, we’ve found over time that people actually want to book directly on partner websites, and we always strive to meet user preferences whenever possible.”
Some pundits saw Book on Google as the company creeping toward becoming an online travel agency, but that never appeared to be the intent. Google makes too much money on travel advertising to want to directly compete with its biggest partners. Google also has no interest in dealing with flight changes and cancellations, or in providing customer service to stranded travelers.
Google launched Book on Google in 2015 as a way to facilitate bookings for airlines and online travel agencies in an era when many of their mobile websites weren’t particularly sophisticated.
But partners’ mobile capabilities have improved in the interim, and Google said it saw a declining share of flight bookings coming from the Book on Google feature.
Many metasearch sites over the years have tried these types of facilitated bookings for partner airlines and hotels, but with a few exceptions, such as HomeToGo in Germany, this type of feature has been waning for years.