American Airlines 2007 Annual Report Download - page 26

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23
On June 20, 2006, the DOJ served the Company with a grand jury subpoena as part of an ongoing investigation
into possible criminal violations of the antitrust laws by certain domestic and foreign passenger carriers. At this
time, the Company does not believe it is a target of the DOJ investigation. The Company intends to cooperate
fully with this investigation. On September 4, 2007, the Attorney General of the State of Florida served American
with a Civil Investigative Demand as part of its investigation of possible violations of federal and Florida antitrust
laws regarding the pricing of air passenger transportation. In the event that this or other investigations uncover
violations of the U.S. antitrust laws or the competition laws of some other jurisdiction, such findings and related
legal proceedings could have a material adverse impact on the Company. Approximately 52 purported class
action lawsuits have been filed in the U.S. against the Company and certain foreign and domestic air carriers
alleging that the defendants violated U.S. antitrust laws by illegally conspiring to set prices and surcharges for
passenger transportation. These cases, along with other purported class action lawsuits in which the Company
was not named, were consolidated in the United States District Court for the Northern District of California as In re
International Air Transportation Surcharge Antitrust Litigation, M 06-01793 on October 25, 2006. On July 9, 2007,
the Company was named as a defendant in the consolidated complaint. Plaintiffs are seeking trebled money
damages and injunctive relief. American will vigorously defend these lawsuits; however, any adverse judgment
could have a material adverse impact on the Company.
American is defending a lawsuit (Love Terminal Partners, L.P. et al. v. The City of Dallas, Texas et al.) filed on
July 17, 2006 in the United States District Court in Dallas. The suit was brought by two lessees of facilities at
Dallas Love Field Airport against American, the cities of Fort Worth and Dallas, Southwest Airlines, Inc., and the
Dallas/Fort Worth International Airport Board. The suit alleges that an agreement by and between the five
defendants with respect to Dallas Love Field violates Sections 1 and 2 of the Sherman Act. Plaintiffs seek
injunctive relief and compensatory and statutory damages. On October 31, 2007, the court entered an order
dismissing all of the plaintiffs’ claims. The plaintiffs have appealed. American will vigorously defend this lawsuit;
however, any adverse judgment could have a material adverse impact on the Company.
On August 21, 2006, a patent infringement lawsuit was filed against American and American Beacon Advisors,
Inc. (a wholly-owned subsidiary of the Company), in the United States District Court for the Eastern District of
Texas (Ronald A. Katz Technology Licensing, L.P. v. American Airlines, Inc., et al.). This case has been
consolidated in the Central District of California for pre-trial purposes with numerous other cases brought by the
plaintiff against other defendants. The plaintiff alleges that American and American Beacon infringe a number of
the plaintiff’s patents, each of which relates to automated telephone call processing systems. The plaintiff is
seeking past and future royalties, injunctive relief, costs and attorneys' fees. Although the Company believes that
the plaintiff’s claims are without merit and is vigorously defending the lawsuit, a final adverse court decision
awarding substantial money damages or placing material restrictions on existing automated telephone call system
operations would have a material adverse impact on the Company.