American said it would continue to fight the suit's allegation that it and the other airlines used their computerized reservations systems to fix ticket prices and discourage discounting.
In the meantime, with the suit hanging over its corporate head, American will no longer answer most questions from reporters about fare increases or decreases unless it has advertised the information widely in the media, spokesman Tim Smith said.
That is the only way American figures it can comply with guidelines on disseminating fare information that have been made part of a consent decree pending in U.S. District Court in Washington, Smith said.
United Airlines and USAir have agreed to settle the Justice Department's charges, while six other carriers - Alaska Airlines, American, Continental Airlines, Delta Air Lines, Northwest Airlines and Trans World Airlines - have not.
The complex dispute stems from a three-year Justice Department antitrust investigation that culminated in the government's filing of the price-fixing suit in December, attacking the way airlines use their reservations systems to inform travel agencies and the public about fare changes.
Justice Department lawyers say that airlines have conspired to use their joint computerized fare clearinghouse, the Airline Tariff Publishing Co., to limit fare competition. Airlines put thousands of fare changes daily into the clearinghouse computer, which then redistributes them to the computer systems owned by each carrier.
To the airlines and to travel agents, who also are staunchly opposed to the pending consent decree, the central clearinghouse is a fast, efficient way to get information about the myriad fares and schedules of all airlines.
But the Justice Department's lawsuit says airlines have nefariously used the system to discourage fare discounting and to fix prices.
One practice, for instance, is for an airline to put a fare increase with a future starting date into the system and then wait to see whether competitors will match it. Unless the other major airlines also raise their prices, however, the first carrier almost always pulls the increase off the market.
Justice Department lawyers contend that many of these proposed increases actually are just trial balloons aimed at pressuring passengers into buying tickets to avoid increases that aren't going to take place anyway.
The lawyers also say airlines have used the system to signal when they don't like a discount fare that one carrier has put in. That has been done by a second airline proposing an even lower discount price, in which case both of the carriers then withdraw the fares. The lawyers say that that constitutes illegal signaling of future pricing intentions to competitors.
The Justice Department's proposed remedy is that airlines be prohibited
from disclosing the beginning and ending dates of fare sales unless they first advertise them widely, in newspapers or other general media.
The allegations in the suit were similar to those made in a civil class- action suit pending in U.S. District Court in Atlanta. In that case, air travelers who bought tickets on the major airlines between Jan. 1, 1988, and June 30, 1992, to, from or between 31 U.S. cities, including Philadelphia, could share in a proposed $408 million refund pool.
In a statement, American said it "believes its past pricing conduct has been perfectly lawful." But if the airline didn't agree to start following the guidelines for disseminating fare information in the Justice Department suit, it could open itself to even more civil lawsuits such as the one pending in Atlanta, the statement said.
Although American's decision to limit the information it gives reporters on fares wasn't designed to enlist the media's support against the Justice Department suit, the airline would welcome help from the media to fight it, Smith added.
"We think this is a blatant case of a misguided attempt to force a change in behavior that didn't need to change," he said.
Not all airlines are feeling as constrained as American over the consent decree. USAir, which already has adopted the information-dissemination guidelines in the decree, hasn't found them that hard to live with, spokeswoman Susan Young said.
For instance, USAir reservations agents no longer provide would-be passengers with information on when a special fare will end.
"But that doesn't seem to have had any immediate effect on customers," Young said. In fact, "the response from customers so far has been nonchalant."
