Travelport sues to stop American from dropping Orbitz
Travelport LP, the travel-reservation systems provider, sued to block American Airlines Inc. from terminating online travel agency Orbitz Worldwide Inc.'s ability to sell tickets on American's flights.
Travelport, whose affiliate owns 48 percent of Chicago-based Orbitz's stock, would suffer substantial harm if American stops providing fare data to Orbitz, a possibility that Orbitz disclosed in a regulatory filing yesterday, according to the complaint filed in chancery court in Chicago today. The termination would be a breach of American's contract with Travelport, the company said in its complaint.
Orbitz stock fell yesterday the most since March 2009 after American, the third-biggest U.S. airline, said it would stop providing fare data. American is pushing online travel agencies to obtain flight and fare information directly from it instead of through global distribution systems such as Travelport's Galileo and Worldspan, Orbtiz chief executive Barney Harford said yesterday in a conference call with analysts.
Travelport said in the complaint that it lost $50 million in share value when Orbitz fell. The company has a 2006 agreement with American Airlines to obtain “full and complete” access to information about its flights, air fares and other information. The airline hasn't honored Travelport's request to withdraw its termination notice, according to the complaint.
‘Coercing Orbitz'
“AA is coercing Orbitz into changing its existing business model to one that AA believes will more thoroughly stuff AA's pockets,” Travelport said in the complaint.
Travelport is seeking a court order stopping American from terminating Orbitz ticket sales until the case can be decided by a judge.
“We received a letter threatening various claims, which are groundless in our view, over the contract action we had taken and we are seeking a declaratory judgment to protect our existing rights,” Mary Sanderson, a spokeswoman for Fort Worth, Texas-based American, said in an e-mail.
The case is Travelport v. American Airlines, 10CH4808, Circuit Court of Cook County, Chancery Division (Chicago).