American Airlines 2009 Annual Report Download - page 26

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On February 14, 2006, the Antitrust Division of the United States Department of Justice (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 air cargo carriers. At this time, the Company does not believe it is a
target of the DOJ investigation. The New Zealand Commerce Commission notified the Company on February 17,
2006 that it is also investigating whether the Company and certain other cargo carriers entered into agreements
relating to fuel surcharges, security surcharges, war-risk surcharges, and customs clearance surcharges. On
February 22, 2006, the Company received a letter from the Swiss Competition Commission informing the
Company that it too is investigating whether the Company and certain other cargo carriers entered into
agreements relating to fuel surcharges, security surcharges, war-risk surcharges, and customs clearance
surcharges. On March 11, 2008, the Company received from the Swiss Competition Commission a request for
information concerning, among other things, the scope and organization of the Company’s activities in
Switzerland. On December 19, 2006 and June 12, 2007, the Company received requests for information from the
European Commission seeking information regarding the Company's corporate structure, and revenue and
pricing announcements for air cargo shipments to and from the European Union. On January 23, 2007, the
Brazilian competition authorities, as part of an ongoing investigation, conducted an unannounced search of the
Company’s cargo facilities in Sao Paulo, Brazil. On April 24, 2008, the Brazilian competition authorities charged
the Company with violating Brazilian competition laws. On December 31, 2009, the Brazilian competition
authorities made a non-binding recommendation to the Brazilian competition tribunal that it find the Company in
violation of competition laws. The authorities are investigating whether the Company and certain other foreign
and domestic air carriers violated Brazilian competition laws by illegally conspiring to set fuel surcharges on cargo
shipments. The Company is vigorously contesting the allegations and the preliminary findings of the Brazilian
competition authorities. On June 27, 2007 and October 31, 2007, the Company received requests for information
from the Australian Competition and Consumer Commission seeking information regarding fuel surcharges
imposed by the Company on cargo shipments to and from Australia and regarding the structure of the Company's
cargo operations. On September 1, 2008, the Company received a request from the Korea Fair Trade
Commission seeking information regarding cargo rates and surcharges and the structure of the Company’s
activities in Korea. On December 18, 2007, the European Commission issued a Statement of Objection (SO)
against 26 airlines, including the Company. The SO alleges that these carriers participated in a conspiracy to set
surcharges on cargo shipments in violation of EU law. The SO states that, in the event that the allegations in the
SO are affirmed, the Commission will impose fines against the Company. The Company intends to vigorously
contest the allegations and findings in the SO under EU laws, and it intends to cooperate fully with all other
pending investigations. In the event that the SO is affirmed or other investigations uncover violations of the U.S.
antitrust laws or the competition laws of some other jurisdiction, or if the Company were named and found liable in
any litigation based on these allegations, such findings and related legal proceedings could have a material
adverse impact on the Company.
Forty-five 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 on cargo shipments. 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 Eastern District of New
York as In re Air Cargo Shipping Services Antitrust Litigation, 06-MD-1775 on June 20, 2006. Plaintiffs are
seeking trebled money damages and injunctive relief. The Company has not been named as a defendant in the
consolidated complaint filed by the plaintiffs. However, the plaintiffs have not released any claims that they may
have against the Company, and the Company may later be added as a defendant in the litigation. If the Company
is sued on these claims, it will vigorously defend the suit, but any adverse judgment could have a material
adverse impact on the Company. Also, on January 23, 2007, the Company was served with a purported class
action complaint filed against the Company, American, and certain foreign and domestic air carriers in the
Supreme Court of British Columbia in Canada (McKay v. Ace Aviation Holdings, et al.). The plaintiff alleges that
the defendants violated Canadian competition laws by illegally conspiring to set prices and surcharges on cargo
shipments. The complaint seeks compensatory and punitive damages under Canadian law. On June 22, 2007,
the plaintiffs agreed to dismiss their claims against the Company. The dismissal is without prejudice and the
Company could be brought back into the litigation at a future date. If litigation is recommenced against the
Company in the Canadian courts, the Company will vigorously defend itself; however, any adverse judgment
could have a material adverse impact on the Company.