Travelport Sues American Airlines to Stop it from Dropping Orbitz

Travelport has filed a lawsuit to block American Airlines from following through on its threat to stop Orbitz from selling tickets on American’s flights as of Dec. 1. Travelport said the move would breach American’s contract with Orbitz and cause Travelport substantial harm. American called Travelport’s lawsuit “groundless.”

Travelport said in its suit, filed in Cook County Circuit Court in Illinois, that American has put its corporate knee on the neck of Orbitz, one of Travelport’s largest customers in order to “coerce” it into changing its existing business to “one that AA believes will more thoroughly stuff AA’s pockets.”

American is trying to get online travel agencies to connect directly to its internal reservation system instead of using the GDS systems that have traditionally been the marketplace for airlines selling tickets. American says that it wants to use technology that is better and less expensive than legacy technology. It says newer technology lets it market more effectively to specific customers and costs less. It says it is willing to work with GDSs but it wants to connect with them using newer technology.

Travelport said that American, which currently pays Travelport what it called a “small fee” for American trips booked through Travelport, wants to reduce or pay nothing at all for these bookings.

Since American threatened to pull out of Orbitz, Travelport has suffered a $50 million loss because Orbitz shares fell 18 percent in one day, Travelport said in the complaint. The company expects to suffer further losses.

Travelport said in its complaint that it had a full-content agreement with American, one in which Travelport accepted “drastically reduced” booking fees from American in return for American’s commitment to the full-content agreement for its duration. That allows Travelport to make this content available to all of its travel agency customers and, specifically, to its affiliates such as Orbitz. Terminating Orbitz’s authority to book American tickets violates the full content agreement, Travelport says.