Air Cargo Shipping Services Antitrust Litigation, MDL No. 1775, 06-MD-1775 (JG) (VVP) (E.D.N.Y.)

Eastern District of New York

Class Period: January 1, 2000 – February 14, 2006


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Robert N. Kaplan
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Gregory K. Arenson
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Gary L. Specks

Kaplan Fox has been appointed by the court as co-lead counsel for direct purchasers of air cargo shipping services in an antitrust class action against the world’s major providers of air cargo shipping services. Specifically, it is alleged that during the time January 1, 2000 through at least February 14, 2006, the defendants participated in a conspiracy to impose inflated surcharges (such as fuel surcharges) on their customers, to eliminate or prevent discounting of air cargo shipping services, to agree on yields, and to allocate customers or routes all in violation of the Section One of the Sherman Antitrust Act.

Twenty of the defendants named in the litigation have also pled guilty to federal criminal antitrust violations collectively paying over $1.5 billion in criminal fines to the United States government. One defendant, Lufthansa, disclosed the conspiracy to the United States Department of Justice, and as a result, was accepted into the Department of Justice’s leniency program. Many of the defendants have also been the subject of proceedings before various competition regulatory authorities throughout the world, including in the European Union, Korea and Australia, relating to their participation in the worldwide conspiracy.

The following providers of air cargo shipping services have been named as defendants in the action: ABSA Cargo Airlines, Air Canada, Air China, Air France, Air India, Air Mauritius, Air New Zealand, Alitalia, All Nippon Airways, American Airlines, Asiana Airlines, British Airways, Cargolux, Cathay Pacific, China Airlines, DAS Air Cargo, El Al, Emirates, Ethiopian Airlines, EVA Airways, Japan Airlines, Kenya Airways, KLM, Korean Air, Lan Cargo, Lufthansa, Malaysia Airlines, Martinair, Nippon Cargo, Polar Air, Qantas, SAS, Saudi Arabian Airways, Singapore Airlines, South African Airways, Swiss International Air Lines, Thai Airways, and VARIG. Several executives of the defendants are also named as defendants.

After extensive motion practice directed at the Complaint, on August 21, 2009, the Court adopted the Report and Recommendation of Magistrate Judge Viktor V. Pohorelsky and ruled that the direct purchaser plaintiffs’ Sherman Act claims satisfied the pleading requirements of Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009).  

On July 10, 2015, the Honorable John Gleeson granted Plaintiffs’ Motion for Class Certification, upholding in its entirety Magistrate Judge Pohorelsky’s 114-page Report and Recommendation (“R&R”) in which he recommended that plaintiffs’ motion for class certification be granted and certain portions of defendants’ experts’ testimony be excluded. In his ruling, Judge Gleeson found “no merit to the objections [to] Judge Pohorelsky’s thorough and well-reasoned Report and Recommendations.” The ruling capped over three years of court battles to determine whether the class should be certified.

To date, plaintiffs have entered into settlements with 25 defendant groups totaling $1.14 billion, of which settlements with 22 defendant groups for $848 million have been granted final approval by the court. The litigation is continuing against three defendant groups, including Air China Ltd. and Air China Cargo Co. Ltd., Air India Ltd., and Air New Zealand Ltd. (“remaining defendants”). 

The parties filed summary judgment papers in April 2015. Plaintiffs filed motions concerning the affirmative defenses of state action, act of state, foreign sovereign compulsion, international comity, filed rate, and Noer-Pennington.  Defendants Air India, Air China, Air New Zealand and Polar Air Cargo, LLC each filed a motion based on each’s non-involvement in the alleged world-wide conspiracy.  Atlas Air Worldwide Holdings, Inc. filed a motion for judgment on the issues of alter ego and agency.  Polar Air Cargo Worldwide filed a motion for judgment on the issue of de facto merger and mere continuation of business.  All remaining defendants filed a motion for partial summary judgment on plaintiffs’ security surcharge claims.  Defendants Air India, Air China, and Air New Zealand filed a motion for summary judgment for failure to prove antitrust damages caused by the alleged conspiracy and for damages barred by the statute of limitations.  After all the motions were fully briefed, the Court heard oral argument on the motions on August 31, 2015, granting all plaintiffs’ six motions for summary judgement and denied all the motions for summary judgment filed by remaining defendants. The Court has set the trial to begin in September 2016.

If you wish to learn more about the litigation, please feel free to contact any of the Kaplan Fox attorneys listed above.

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