AMERICA: NWA subpoenaed in price-fix probe

Northwest Airlines Corp. said it has been subpoenaed by the Department of Justice in a probe of possible air cargo price-fixing, the Associated Press reported. More than a dozen airlines have been the subject of an investigation initiated by US and European Union officials into suspected price-fixing in the air cargo industry on surcharges for […]


Northwest Airlines Corp. said it has been subpoenaed by the Department of Justice in a probe of possible air cargo price-fixing, the Associated Press reported.

More than a dozen airlines have been the subject of an investigation initiated by US and European Union officials into suspected price-fixing in the air cargo industry on surcharges for fuel, security and insurance. Northwest, which runs the largest cargo business of any of the US passenger airlines, had not been publicly identified as a target in the probe.

The airline acknowledged the subpoena after the Associated Press inquired about an attorney bill submitted in its bankruptcy case for $1.17 million for “DOJ Cargo Price Fixing Investigation”.

The bill submitted covered 5,048 hours of work by several lawyers at Boies, Schiller & Flexner LLP. It covered “document review, witness interviews, research and analysis of issues arising from Justice Department investigation,” according to the filing.

The matter was labeled as a “criminal investigation” in an earlier bill from the same law firm. That bill covered 5,916 hours at a cost of $1.36 million.

Northwest spokesman Dean Breest said that the airline received a subpoena from the Department of Justice in the spring of 2006 and that it is cooperating. In September, UAL Corp.’s United Airlines and AMR Corp.’s American Airlines disclosed settlements that did not involve payments in a lawsuit that arose from the investigation. Lufthansa AG paid $85 million to settle pending lawsuits in the case.