"NWA Confirms Subpoena in Price-Fix Probe"

Thursday, March 29, 2007

NWA Confirms Subpoena in Price-Fix Probe
By JOSHUA FREED
The Associated Press


Northwest Airlines Corp. has been subpoenaed by the Department of Justice in
a probe of possible air cargo price-fixing, the carrier disclosed Wednesday.

More than a dozen airlines have been the subject of an investigation
initiated by U.S. 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 U.S.
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" between Oct. 1, 2006, and Jan.
31, 2007. The bill submitted late Tuesday 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 for June 1 to Sept. 30, 2006. That bill covered 5,916
hours at a cost of $1.36 million.

Northwest spokesman Dean Breest said Wednesday that the airline received a
subpoena from the Department of Justice in the spring of 2006 and that it is
cooperating.

A Justice Department spokeswoman confirmed that the air cargo probe is
ongoing but declined to comment further.

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.

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