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Northwest Airlines Fined $38 Million

Northwest to pay $38M for its role in price-fixing plot

Roxel Santos  Aug 01, 2010

Northwest Airlines agreed to pay $38 million reparation after pleading guilty to fixing air-cargo shipments prices.

The Department of Justice declared on Friday that Northwest admitted the issue. According to the department, the airline was engaged in collusion to fix the charges for shipments on direction between United States and Japan from partly July 2004 to partly February of 2006.

Northwest Airlines is presently part of Delta Air Lines Inc.

The prosecutors stated that Northwest as well as other air-cargo shippers conducted meetings and discussions in the U.S. and outside in which they accorded on shipping charges that violates the federal antitrust law. Prosecutors also said that the carriers likewise enforced and inspected each other’s allegiance to the fixing agreements.

Betsy Talton, Delta spokesperson noted in a written statement that the meeting happened before the Northwest consolidation, and she added that the Justice Department settlement does not affirm any wrongdoing by any present or former board of member or officer of Northwest Airlines or Delta.

Talton also said that the airline terminated the employment of the people who it supposed had crucial liability for the behavior in question.

The department revealed 16 airlines have recently pleaded guilty or accepted to plead guilty to prices fixing on air-cargo shipments, with reparation summing over $1.6 billion.

In 2007, the Korean Air Lines and British Airways PLC separately paid $300 million criminal fine, while in 2008, Air France-KLM paid almost $350 million fine.

Moreover, the Justice Department stated that Northwest agreed to cooperate in the continuing price fixing investigation on the government.

In line with this development, the parent of American Airlines agreed to pay $5 million to arrange a U.S. class-action lawsuit carried out by carriers saying they were cheated by the airlines. The AMR Corporation admitted no misconducts and stated it settled to prevent the expense of the trial.

Attorneys representing the carriers stated the settlement was milestone move, as AMR agreed to coordinate with the European defendants seeking assistance.

Northwest to pay $38M for its role in price-fixing plot
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