ASTA set to sue defunct line's estate
By Rebecca Tobin
Originally Published at: Travelweekly.com
ALEXANDRIA, Va. -- ASTA is going to court to stop the estate of Renaissance Cruises from suing travel agents for commissions paid on cruises that never sailed.
The Society this week intends to file a class-action suit in U.S. Bankruptcy Court in the Southern District of Florida -- where Renaissance's liquidation is in progress -- on behalf of travel agents who received a summons seeking the return of commissions for canceled sailings.
Renaissance ceased operations and filed for bankruptcy in September 2001.
An attorney for the debtor told Travel Weekly last year the estate would sue to try to recover about $9 million in agent pay. At the time, agency groups such as ASTA and ARTA advised agents not to return their commissions.
"I would guess that most agents did not pay," said ASTA president Richard Copland.
Tabas Freedman and Soloff, which was appointed the trustee of Renaissance's liquidating trust in July 2002 and which is acting as the plaintiff in these cases, did not return phone calls seeking comment.
According to a copy of a summons obtained by Travel Weekly, the trust is seeking commissions on cruises that never sailed but were paid for within the year prior to the bankruptcy filing on Sept. 25, 2001, as well as commissions paid after the bankruptcy filing date that were "not authorized" by the court.
The summons argues Renaissance "was never obligated to [the agency], with respect to these payments since the passenger(s) never sailed."
Copland argued the opposite.
"As an agent for a principal, if you produce a buyer who's ready, willing and able to travel, and who has paid for that trip completely, you have earned your commission," he said.
If ASTA's suit is granted class-action status, claims against retailers, including non-ASTA agencies, will be argued together, saving defendants from having to travel to the court in Fort Lauderdale to argue their case.
A class-action lawsuit filed as a defense maneuver is unusual, but ARTA attorney Alexander Anolik said it was the "quickest way to do this."
He also advised agents who received summonses regarding other issues than commissions already earned to seek additional bankruptcy counsel.