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Personal Finance > Smart Spending > Travel
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U.S. subpoenas Orbitz records
Report says regulators stepping up investigation of airline-owned online travel site.
May 13, 2002: 8:23 AM EDT

NEW YORK (CNN/Money) - The Justice Department is stepping up its antitrust investigation into Orbitz, the online travel service owned by the nation's major airlines, according to a published report.

USA Today reported Monday that Justice has subpoenaed major airlines, which the paper said is a sign that its lengthy review has evolved into a formal probe into whether the site's contracts with airlines violate antitrust law.

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The paper quotes unnamed lawyers familiar with the probe as saying investigators are looking into how often airlines are giving the lowest fares to sites other than Orbitz and whether Orbitz's contracts amount to an agreement between airlines not to compete vigorously.

The paper does not quote an Orbitz official as commenting directly on the probe. Orbitz spokesperson Carol Jouzaitis wouldn't comment on the report of subpoenas, but she told CNNfn, "We are confident that regulators will not have any problem with us. Orbitz has been reviewed by various agencies and been cleared in every case and we are confident we will be cleared again.

Orbitz has been under the scrutiny of federal regulators since it started in June 2001. While its airline owners argued the site would increase competition among online travel sites and lead to lower pricing, competitors were worried it would have an unfair advantage in offering the lowest fares. The site is owned by the nation's five largest airline companies -- American Airlines owner AMR Corp. (AMR: Research, Estimates), United Airlines owner UAL Corp. (UAL: Research, Estimates), Delta Air Lines (DAL: Research, Estimates), Northwest Airlines (NWAC: Research, Estimates) and Continental Airlines (CAL: Research, Estimates).

The Transportation Department also is eyeing Orbitz, USA Today reported. The DOT's review takes place as the agency prepares new rules governing the computer reservation systems used by travel agents to compare fares and book air travel.

Airlines are required to treat all reservation systems equally. The paper said DOT is considering whether to extend the rules to Web sites, requiring airlines to list the same fares on all Web sites as they now do for reservation systems.

In March Orbitz CEO Jeff Katz issued a statement saying his service welcomed the DOT's review.

"The DOT review is nothing new; in fact in a previous regulatory reviews Orbitz was cleared of any competitive issues," said his statement. "We welcome continued competition in the online agency marketplace and are confident that this study will reaffirm our pro-competition, pro-consumer position."  Top of page


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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.