Polar Air Cargo agrees to payout $100m in US cartel lawsuit
08 / 01 / 2016
Polar Air Cargo has reached a $100m settlement with plaintiffs in the ongoing air cargo cartel class action lawsuit in the US.
In a statement, the airline said that it, along with Polar Air Cargo Worldwide and parent Atlas Air Worldwide Holdings, will pay out $35m by January 15 this year, a further $35m by January 15 in 2017 and final installment of $30m a year later.
Polar denied any wrongdoing: “The settlement agreement resolves all claims against the companies by participating members in the class action.
“The companies continue to deny any wrongdoing or liability, and there is no admission of any wrongdoing or liability in the settlement agreement.”
The industry-wide litigation arose from allegations about the pricing practices of a number of air cargo carriers on routes to and from the US from January 2000 through September 2006.
The payments are expected to be funded from cash available on hand.
Atlas Air Worldwide president and chief executive William Flynn was looking forward to the future
He said: “We are committed to the highest standards of ethics and governance.
“It is important to put this legacy matter behind us and focus our full attention on the continued execution of our strategic growth initiatives.
“Our business continues to generate substantial cash flows, and we look forward to capitalising on the significant opportunities ahead to deliver value for our shareholders, employees and customers.”
Law firm Kaplan Fox & Kilsheimer LLP, which is one of four co-lead counsels representing plaintiffs, said the Polar settlement was the second highest so far.
It added that in total 25 settlements had been entered into totalling $1.14bn, of which 22 defendant groups for $848m have been granted final approval by the court.
This litigation is still pending against three defendant groups, including Air China and Air China Cargo, Air India and Air New Zealand.
Atlas Air Worldwide expects to record an expense for the full amount of the Polar settlement in the fourth quarter of 2015, which should total approximately $2.60 per diluted share on an after-tax basis.
Excluding this impact, the settlement does not affect Atlas Air Worldwide’s previously issued adjusted earnings outlook for 2015, nor does the settlement affect other related litigation or the company’s ongoing business operations.
Just before Christmas the European General Court overturned fines totalling €800m related to an alleged price-fixing cartel.