Seeker Posted October 29, 2007 Share Posted October 29, 2007 I guess if you can't make it as an airline you could try to make it in the courts. Personally I'd be embarrassed to work for such an outfit. Porter seeks end to Air Canada, Jazz ties BRENT JANG October 27, 2007 One-year-old Porter Airlines Inc. is asking the Ontario Superior Court to break ties between Air Canada and its sister company, regional carrier Jazz Air Income Fund. Porter alleges the relationship is in breach of the Competition Act, claiming $850-million in damages. Jazz launched a lawsuit against privately owned Porter last year to gain access to facilities at Toronto City Centre Airport, where the upstart carrier is based. A Porter affiliate evicted Jazz from the island airport in February, 2006. In a statement of defence and counterclaim, Porter alleges that Air Canada and Jazz have conspired to lessen competition by "entering into an agreement through which they effectively co-ordinate their activities to establish airfare prices, increase their market dominance, avoid competition between themselves and impede new competitors such as Porter Airlines." Print Edition - Section Front Porter president Robert Deluce said in an interview yesterday that Air Canada and Jazz offer discounts to corporations only if they do bulk bookings, jointly seeking to "destroy" Porter, which flies to Ottawa, Montreal and Halifax. The allegations have not been proven in court. Under a so-called capacity purchase agreement with Air Canada, Jazz is paid by Air Canada to operate flights. In effect, Jazz serves as a charter airline for Air Canada, collecting fees. ACE Aviation Holdings Inc., created in 2004 after Air Canada emerged from bankruptcy protection, owns 20.1 per cent of Jazz and 75 per cent of Air Canada. Jazz spokeswoman Debra Williams said Jazz's ties with Air Canada are standard practice in North America's airline industry. In a statement, Halifax-based Jazz dismissed Porter's request for a court injunction, saying the claims "are completely without merit and will be vigorously contested in court." Porter's statement of defence and counterclaim are part of a protracted legal fight. Jazz's lawsuit filed in February, 2006, also named the Toronto Port Authority, which oversees the island airport, as a defendant. Air Canada spokesman Peter Fitzpatrick said Montreal-based Air Canada backs Jazz's push to re-enter the island airport. "Porter Airlines' counterclaim is frivolous," Air Canada said in a statement. One aviation industry lawyer said the Air Canada-Jazz relationship is generally stronger than links between mainline and regional carriers in the United States. JAZ.UN (TSX) fell 7 cents to $7.70. AC.B (TSX) fell 33 cents to $16.20. ACE.B (TSX) rose 12 cents to $29.35. Link to comment Share on other sites More sharing options...
J.O. Posted October 29, 2007 Share Posted October 29, 2007 Already being discussed here. http://forum.aeforum.net/index.php?showtopic=384570 Link to comment Share on other sites More sharing options...
Super 80 Posted October 29, 2007 Share Posted October 29, 2007 find me a counter-claim in any lawsuit ever filed that isn't excessive. Link to comment Share on other sites More sharing options...
CanadaEH Posted October 29, 2007 Share Posted October 29, 2007 Well that makes it ok then.. $850M is a ridiculous figure. Pathetic, really. Link to comment Share on other sites More sharing options...
Seeker Posted October 29, 2007 Author Share Posted October 29, 2007 Already being discussed here. http://forum.aeforum.net/index.php?showtopic=384570 Thanks, I was wondering why it wasn't being posted! Link to comment Share on other sites More sharing options...
blues deville Posted October 30, 2007 Share Posted October 30, 2007 I guess if you can't make it as an airline you could try to make it in the courts. Personally I'd be embarrassed to work for such an outfit. You should check out the quality of service Porter provides to their passengers and then post your opinion about where you should work. Link to comment Share on other sites More sharing options...
Seeker Posted October 30, 2007 Author Share Posted October 30, 2007 You should check out the quality of service Porter provides to their passengers and then post your opinion about where you should work. The quality of the service has nothing to do with lack of respect I feel for their management. I'm sure the employees are hard working and conscientious. Link to comment Share on other sites More sharing options...
Guest Fran Six Posted November 19, 2007 Share Posted November 19, 2007 What I figure: Poter's move here is part of a larger battle plan to create a competitor for Air Canada and obfuscates the intentions of the other players. Either that, or the move reflects the liabilities incurred by Porter as a startup. They could not have been rated a AAA commercial backed paper to cover the risk incurred, so Porter went ahead anyway, signing on the entire responsibility for the leverage used. Considering that the financial industry routinely uses something in the order of 10X leverage and that airlines that have gone broke in the past incur liabilities for Credit Default Swaps written against commercial paper rack up in the order of 10X yearly cash flow, I would surmise that Porter might have stubbed its toe, since the credit crunch may have pulled the carpet out from under their feet. So if they are asking $850m. in damages, then probably their revenue for the year is $85m. Hard to see how this case is justified in any way, though very revealing on how they intend to continue their business plan. F6 Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.