US Airways sues Sabre over pricing

AP News
Posted: Apr 21, 2011 7:08 PM
US Airways sues Sabre over pricing

US Airways Group Inc. is suing Sabre Holdings Corp., saying the operator of reservations systems shuts out competition to protect monopoly pricing power.

Airlines have been tangling with Sabre and other so-called global distribution services over pricing. Airlines pay a fee to the distributors for each ticket sold, and they say that fee is too high.

US Airways just signed a new contract with Sabre last month. The lawsuit didn't refer specifically to those negotiations, but said "Sabre's monopoly power is demonstrated directly by its strong-armed negotiating tactics and apparent willingness to forgo US Airways' business."

Sabre is even more important to airlines than other fare distributors, because it is mainly used by travel agents who book corporate travel. The lawsuit filed in New York on Thursday says 35 percent of US Airways revenue is booked through Sabre.

"As Sabre presumably recognizes, if US Airways lost the revenue booked through Sabre, the airline would likely be forced into bankruptcy," it wrote in the lawsuit.

Sabre said it is reviewing the lawsuit and "will have further comment when appropriate."

American Airlines had sued Sabre, too, but the litigation is on hold until June 1 as they try to reach an agreement. Last week American sued online travel company Orbitz Worldwide Inc. alleging anticompetitive behavior.