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Lufthansa settles in Hall commission suit

Lufthansa settles in Hall commission suit
Originally Published on www.travelweekly.com

EAST MEADOW, N.Y. -- Lufthansa and travel agency representatives reached a settlement in the Sarah Hall commission class-action suit, with Lufthansa creating a performance-based incentive program and making all of its Web fares available online for agent bookings.
The settlement is subject to court approval.

This is apparently the first settlement in Hall et al. v. the Airlines, a class action alleging collusion over commission cuts that was filed on behalf of travel agents in the U.S. District Court for the Eastern District of North Carolina, Southern Division.

Under the settlement, Lufthansa will create the Lufthansa Transatlantic Bonus Program, which enables all agencies that don't have contractual relationship with Lufthansa to earn up to a $100 bonus for each Lufthansa transatlantic roundtrip ticket sold beginning Jan. 1, 2004.
In subsequent years, eligibility for the incentive program will be based on meeting revenue goals, Lufthansa said.

In addition, beginning Jan. 1, Lufthansa will make all its Web fares available to all agents to view and book at www.lufthansa-usa.com, and Lufthansa will continue to issue these tickets.

In a statement, Hall, the lead plaintiff in the potentially landmark case, welcomed the settlement with Lufthansa.

"Every agent is always looking for a better way to service his or here customers, and keeping up with the online travel market is a key part of this challenge, said Hall of Travel Specialist in Wilmington, N.C.
"We're thrilled that Lufthansa considered a technology solution as part of this agreement," Hall added. "This program gives the smaller travel agencies a chance to show they can make a difference, and we expect Lufthansa's sales will get a huge boost."

Not everyone was thrilled with the deal, however.

Alexander Anolik, who represents three ARTA co-plaintiffs as ARTA's legal counsel, said Friday said that the Web-fare provision does not address the fact that agents can book Lufthansa through many other outlets, and Lufthansa's proposed incentives are insufficient.

"We are happy that the first of the defendants rolled," said Anolik. "The settlement as it pertains to travel agents in the future is known in the law as illusory."

Anolik argued that the most an agent can earn under the Lufthansa agreement is $30 on a ticket. "Thirty dollars on a $1,200 ticket is nothing," he said.

There was no immediate word if settlements with any of the other defendants -- including American, Air Canada, Alaska, America West, Delta, Frontier, Horizon, Midwest and Air France -- were in the works.