American Airlines Inc v. Travelport Limited et al

Filing 89

Brief/Memorandum in Support filed by Travelport Limited, Travelport, LP re #88 MOTION to Stay Discovery Pending a Decision on Travelport's Rule 12(b)(6) Motion to Dismiss Plaintiff's First Amended Complaint (Friedman, Walker)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION

AMERICAN AIRLINES, INC.,
Plaintiff,
vs.
SABRE, INC., a Delaware corporation;
SABRE HOLDINGS CORPORATION, a
Delaware corporation and SABRE TRAVEL
INTERNATIONAL LTD., a foreign
corporation, d/b/a SABRE TRAVEL
NETWORK;
TRAVELPORT LIMITED, a foreign
corporation, and TRAVELPORT, LP, a
Delaware limited partnership, d/b/a
TRAVELPORT;
and
ORBITZ WORLDWIDE, LLC,
a Delaware limited liability company,
d/b/a ORBITZ,
Defendants.

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TRAVELPORT ’S MEMORANDUM IN SUPPORT OF MOTION TO STAY
DISCOVERY PENDING A DECISION ON TRAVELPORT’S RULE 12(b)(6)
MOTION TO DISMISS PLAINTIFF’S FIRST AMENDED COMPLAINT

TABLE OF CONTENTS
Page
INTRODUCTION ............................................................................................................. 1
PROCEDURAL BACKGROUND.................................................................................... 3
ARGUMENT..................................................................................................................... 4
I.

THE COURT HAS BROAD AUTHORITY TO STAY DISCOVERY ............... 4

II.

THE STRENGTH OF TRAVELPORT’S MOTION TO DISMISS
FAVORS A STAY ................................................................................................ 5

III.

STAYS ARE ESPECIALLY APPROPRIATE FOR ANTITRUST
LITIGATION......................................................................................................... 7
1.
2.

IV.

Discovery burdens in this case will be substantial………………………..8
AA's expedited discovery requests are not narrowly tailored…………….9

AA LACKS A COMPELLING JUSTIFICATION FOR IMMEDIATE
DISCOVERY....................................................................................................... 11

CONCLUSION................................................................................................................ 16

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TABLE OF AUTHORITIES
CASES
Bell Atl. Corp. v. Twombly,
550 U.S. 544 (2007)...................................................................................................4, 7
Carter v. Ozoeneh,
2009 U.S. Dist. LEXIS 45679 (W.D.N.C. 2009).........................................................11
Coss v. Playtex Prods. LLC,
2009 WL 1455358 (N.D. Ill. 2009) ...............................................................................8
Dimension Data North America, Inc. v. NetStar-1,
226 F.R.D. 528 (E.D.N.C. 2005) .............................................................................9, 11
Dowdy & Dowdy Partnership v. Arbitron, Inc.,
2010 U.S. Dist. LEXIS 108798 (S.D. Miss. 2010)........................................................7
DSM Desotech Inc. v. 3D Sys. Corp.,
2008 U.S. Dist. LEXIS 87473 (N.D. Ill. 2008) .............................................................8
Edgenet, Inc. v. Home Depot, U.S.A., Inc.,
259 F.R.D. 385 (E.D. Wis. 2009) ................................................................................11
El Pollo Loco, S.A. de C.V. v. El Pollo Loco, Inc.,
344 F. Supp. 2d 986 (S.D. Tex. 2004) .........................................................................11
Ford Motor Co. v. U.S. Auto Club,
2008 U.S. Dist. LEXIS 34240 (N.D. Tex. 2008)...........................................................5
In re Graphics Processing Units Antitrust Litig.,
2007 U.S. Dist. LEXIS 57982 (N.D. Cal. 2007) .......................................................6, 7
In re Netflix Antitrust Litig.,
506 F. Supp. 2d 308 (N.D. Cal. 2007) ...........................................................................8
In re Sulfuric Acid Antitrust Litig.,
231 F.R.D. 331 (N.D. Ill. 2005).....................................................................................7
In re Text Messaging Antitrust Litig.,
630 F.3d 622 (7th Cir. 2010) .........................................................................................8
Landry v. Air Line Pilots Ass'n Int'l AFL-CIO,
901 F.2d 404 (5th Cir. 1990) .........................................................................................5

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McLafferty v. Deutsche Lufthansa A.G.,
2008 U.S. Dist. LEXIS 81627 (E.D. Pa. 2008) .............................................................8
Momenta Pharms., Inc. v. Teva Pharms. Indus.,
2011 U.S. Dist. LEXIS 18562 (D. Mass. 2011) ..........................................................12
Nowell v. Coastal Bend Surgery Ctr.,
2011 U.S. Dist. LEXIS 10005 (S.D. Tex. 2011) ...........................................................4
Petrus v. Bowen,
833 F.2d 581 (5th Cir. 1987) .........................................................................................4
Philadelphia Newspapers v. Gannett Satellite Info. Network, Inc.,
1998 U.S. Dist. LEXIS 10511 (E.D. Pa. 1998) .............................................................9
Rio Grande Royalty Co. v. Energy Transfer Partners, L.P.,
2008 U.S. Dist. LEXIS 112721 (S.D. Tex. 2008) .....................................................5, 7
Todd v. Exxon,
275 F.3d 191 (2d Cir. 2001)...........................................................................................6
Von Drake v. NBC,
2004 U.S. Dist. LEXIS 25090 (N.D. Tex. 2004)...........................................................5
FEDERAL RULES
Fed. R. Civ. P. 16.................................................................................................................3
Fed. R. Civ. P. 26.................................................................................................................3

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INTRODUCTION
Defendants Travelport Limited and Travelport, LP (collectively, “Travelport”)
oppose plaintiff American Airlines, Inc.’s (“AA’s”) attempts to obtain expedited
discovery through a premature Rule 16(a) case management conference and renew the
motion to stay discovery pending a decision on Travelport’s dispositive Rule 12(b)(6)
motion. Travelport has filed a new Rule 12(b)(6) motion that addresses AA’s First
Amended Complaint (the “Amended Complaint”). Like its predecessor, this motion
would dispose of all claims against Travelport and, if granted, would obviate the need for
expensive antitrust discovery.
This case is not a genuine antitrust action to protect consumers but an attempt by
AA to enhance its leverage in the stalled negotiations over contracts with Travelport that
are set to expire this summer. With contract expirations approaching, AA has been
attempting to turn up the heat on Travelport by asking that antitrust discovery begin early
so that AA can start running up Travelport’s expenses before the contracts expire and
before Travelport’s motion to dismiss is even decided.
Discovery at this stage of the litigation, however, remains premature. Although
AA amended its complaint, it failed to correct any of the fatal defects in the original. AA
continues to rely on an implausible product market – Travelport services to travel agents
that subscribe to Travelport. This is a market in which Travelport is a monopolist by
definition. The market excludes travel agents who choose to use any of Travelport’s
competitors. Courts routinely dismiss monopolization claims based on such contrived
“single-brand” markets.

AA has yet to provide any coherent explanation as to why it needs discovery prior
to the Court’s decision on Travelport’s dispositive motion. All that we have is conjecture
about a future preliminary injunction request that may or may not be necessary depending
on what actions Travelport may or may not take after the contracts expire. Such
conjecture about a future preliminary injunction does not justify burdening the parties and
third parties with far-reaching antitrust discovery. Nor should the Court have to bear the
burden of managing such discovery prior to a determination that AA has even stated a
claim upon which relief can be granted.
The scope of relevant discovery in an expedited proceeding is uncertain as AA
remains silent about what legal grounds, if any, would entitle it to a preliminary
injunction. What little AA has said about fast-track discovery reveals that it would be a
large and expensive undertaking. AA has recently narrowed its proposed documents
requests from its earlier “Non-Exhaustive List of Document Preservation Categories.”
Compare App. at 6-10 (attaching Hartmann Letter of April 27, 2011) with App. at 13-15
(attaching Rothman Letter of June 10, 2011). But AA’s requests remain far reaching–
asking for much more than copies of documents Travelport produces to the Department
of Justice (“DOJ”) or in the Illinois contract litigation. Moreover, it is impossible to
determine whether these document requests are relevant, much less narrowly tailored, to
AA’s needs because AA has not yet explained the legal grounds upon which it would
seek preliminary relief.
The Court need not intervene to order expedited discovery because of a possible
preliminary injunction motion that may or may not be filed. The overwhelming weight
of the relevant precedent, designed to promote judicial economy and avoid wasteful

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discovery proceedings, supports deferral of antitrust discovery until a decision on the
dispositive motions that have already been filed.
PROCEDURAL BACKGROUND
Relief Requested. AA served its original complaint in April. After Travelport
moved to dismiss, AA superseded its original complaint by filing an amended complaint.
Based on its single-brand product market, AA seeks treble damages for alleged antitrust
violations occurring in the United States and several European nations. The claimed
antitrust violations are alleged to have started more than four years ago.
Despite the fact that AA initiated this case in April and amended its complaint, it
still does not seek a temporary restraining order or a preliminary injunction grounded in
any factual allegations of imminent harm. Rather, the Amended Complaint seeks a
“permanent injunction” to bar “unlawful retaliatory conduct.” Am. Compl. at ¶ 159. It
also requests “such other permanent injunctive relief, as the Court deems appropriate,
designed to create market conditions capable of dissipating Travelport’s unlawfully
maintained monopoly power.” Id. at ¶ 160.
Scheduling and Case Management. Under the Federal Rules, a Scheduling Order
issued by the Court is due on July 26. Fed. R. Civ. P. 16(b). This is the earlier of 120
days after service or 90 days after a defendant in this case first appeared. Id. The parties
must hold a discovery conference at least three weeks before the Scheduling Order is due.
Id. at 26(f). As such, AA, Travelport, Sabre, and Orbitz must hold their Rule 26(f)
discovery conference by July 5 and thereafter submit their Joint Status Report to the
Court. The Federal Rules bar either side from conducting discovery at this time absent
compelling circumstances justifying accelerated proceedings.

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Motions Pending. When AA amended its complaint, Travelport and Orbitz each
had a dispositive Rule 12(b)(6) motion to dismiss pending. Also pending was
Travelport’s motion to stay discovery until the Court decided Travelport’s Rule 12(b)(6)
motion. AA’s filing of an amended complaint renders moot each of these earlier motions
addressing the original complaint. See, e.g., Nowell v. Coastal Bend Surgery Ctr., 2011
U.S. Dist. LEXIS 10005, at *1-2 (S.D. Tex. 2011) (amended complaint renders earlier
filed motion to dismiss moot). The parties stipulated that the defendants will file new
Rule 12(b)(6) motions to dismiss directed at the Amended Complaint. Stipulation
Concerning Response to Travelport’s and Orbitz’s Rule 12(b)(6) Motions to Dismiss the
Complaint [Doc. No. 76]. Travelport today filed a new Rule 12(b)(6) motion challenging
the Amended Complaint.1
ARGUMENT
Travelport’s request for a discovery stay pending resolution of its dispositive
motion is an unremarkable and sensible request. “[I]t is one thing to be cautious before
dismissing an antitrust complaint in advance of discovery, but quite another to forget that
proceeding to antitrust discovery can be expensive.” Bell Atl. Corp. v. Twombly, 550 U.S.
544, 558 (2007) (citation omitted).
I.

The Court Has Broad Authority to Stay Discovery
"A trial court has broad discretion and inherent power to stay discovery until

preliminary questions that may dispose of the case are determined." Petrus v. Bowen,
833 F.2d 581, 583 (5th Cir. 1987). Although a stay of discovery is not automatic when a
dispositive motion is pending, "[a] stay of discovery may be appropriate where the
1

Travelport’s Rule 12(b)(3) motion was also rendered moot by AA’s filing of the Amended Complaint, but
Travelport will not file a new Rule 12(b)(3) motion addressed to the Amended Complaint.

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disposition of a motion to dismiss might preclude the need for discovery altogether thus
saving time and expense." Von Drake v. NBC, 2004 U.S. Dist. LEXIS 25090, at *3 (N.D.
Tex. 2004) (quoting in part Landry v. Air Line Pilots Ass'n Int'l AFL-CIO, 901 F.2d 404,
436 (5th Cir. 1990)).
Among the factors that inform the Court's discretion are: the strength of the
dispositive motion, the scope of relevant discovery, the burden of responding to
discovery of this magnitude, and the need for immediate discovery. See Von Drake, 2004
U.S. Dist. LEXIS 25090, at *3; Rio Grande Royalty Co. v. Energy Transfer Partners,
L.P., 2008 U.S. Dist. LEXIS 112721, at *3-4 (S.D. Tex. 2008). Courts have wide
discretion in determining whether these factors weigh in favor of deferring discovery
proceedings until the potentially dispositive motion is decided. Id.
II.

The Strength of Travelport’s Motion to Dismiss Favors a Stay
The strength of Travelport’s Rule 12(b)(6) motion weighs heavily in favor of a

stay. In assessing whether the strength of a motion to dismiss favors a stay of discovery,
the Court need not predict the ultimate outcome of the motion to dismiss. It is sufficient
that “substantial arguments for dismissal” are made that “might preclude the need for
discovery altogether thus saving time and expense.” Von Drake, 2004 U.S. Dist. LEXIS
25090, at *2 (granting motion to stay).
Motions that may dispose of “many, it not all, of the claims asserted” carry more
weight. Id. In contrast, courts provide less weight to motions directed at only a subset of
the claims. Ford Motor Co. v. U.S. Auto Club, 2008 U.S. Dist. LEXIS 34240, at *3 (N.D.
Tex. 2008) (“it is significant to note that defendant does not seek dismissal of the entire
case” but rather only “injunctive and declaratory relief” for a portion of the claims).
Travelport’s motion to dismiss challenges the product market definition upon which the
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antitrust case stands and further challenges the remaining state business tort counts on
federal preemption grounds.
AA’s entire Amended Complaint skates on thin ice. The antitrust claims depend
on a single-brand product market, a rare exception in antitrust law. Since the governing
Supreme Court decision in this area, no antitrust actions against a GDS – neither private
nor public – have survived a motion to dismiss on this single-brand product market
theory. Such a product market definition conflicts with established, modern antitrust
precedent. AA’s Amended Complaint is thus not the type of antitrust complaint that can
provide the court, upon a quick review, with a high degree of confidence that it will
survive a motion to dismiss. See In re Graphics Processing Units Antitrust Litig., 2007
U.S. Dist. LEXIS 57982, at *23-24 (N.D. Cal. 2007) (“Nor is this a case where it is
almost certain that the complaint is viable, such as is often true where guilty pleas have
already been entered in parallel criminal cases.”).
Complaints relying on single-brand markets are routinely dismissed at the
pleadings stage. See Todd v. Exxon, 275 F.3d 191, 200 n.3 (2d Cir. 2001) (“Cases in
which dismissal on the pleadings is appropriate frequently involve … failed attempts to
limit a product market to a single brand . . ..”). In light of the potential for opportunistic
litigation, courts will not allow plaintiffs to plead a single-brand product market except in
the rarest of circumstances. A well developed body of law, including Supreme Court and
Fifth Circuit precedent, delineates the limited circumstances in which plaintiffs can open
the door to expensive monopolization litigation using an alleged single-brand product
market. The alleged product market consisting of Travelport services for travel agents
using Travelport does not fit this exception. This product market definition should be

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federal court-tested before AA can open the doors to expansive and expensive antitrust
discovery.
III.

Stays Are Especially Appropriate for Antitrust Litigation
Motions to stay discovery pending a decision on a potentially dispositive Rule

12(b)(6) motion “are granted with substantial frequency” in antitrust litigation. In re
Sulfuric Acid Antitrust Litig., 231 F.R.D. 331, 336 (N.D. Ill. 2005). That antitrust
litigation imposes extreme costs has been recognized by the Supreme Court. Twombly,
550 U.S. at 558-59.
Pointing to Twombly, a district court in this Circuit recently granted a motion to
stay and stated that “[p]roving an antitrust conspiracy of unspecified timing and scope is
precisely the type of ‘sprawling, costly and hugely time-consuming undertaking’” that
should not be rushed into. Dowdy & Dowdy Partnership v. Arbitron, Inc., 2010 U.S. Dist.
LEXIS 108798, at *5 (S.D. Miss. 2010) (quoting Twombly, 550 U.S. at 559). The district
court concluded that the “equities and potential harm to the defendants . . . weigh[ed]
heavily in favor of granting a stay of discovery” so as to avoid “very expensive” antitrust
discovery. Dowdy, 2010 U.S. Dist. LEXIS 108798, at *6.
While Twombly did not "erect an automatic, blanket prohibition on any and all
discovery before an antitrust plaintiff's complaint survives a motion to dismiss, . . . to
allow antitrust discovery prior to sustaining a complaint would defeat one of the
rationales of Twombly, at least when the discovery would be burdensome." In re
Graphics Processing Units Antitrust Litig., 2007 U.S. Dist. LEXIS 57982, at *23. It is
now common practice, albeit not a categorical rule, for courts to defer discovery
proceedings in complex antitrust cases until a decision on the dispositive motion. Rio
Grande Royalty Co., 2008 U.S. Dist. LEXIS 112721, at *2-4 (S.D. Tex. 2008) (“staying
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discovery may be particularly appropriate in antitrust cases, where discovery tends to be
broad, time-consuming and expensive”); McLafferty v. Deutsche Lufthansa A.G., 2008
U.S. Dist. LEXIS 81627, at *6 (E.D. Pa. 2008) (“[D]elaying discovery until the Court can
determine whether or not Plaintiffs have pled the facts necessary to proceed” with
antitrust litigation will “help to streamline the expensive discovery process, and, thereby,
minimize the burden on counsel, parties and the Court”).2
1.

Discovery burdens in this case will be substantial

There is no doubting that this lawsuit can be expected to impose significant
discovery burdens on the parties, third parties, and the Court. See App. at 8-10 (attaching
AA’s Non-Exhaustive List of Document Preservation Categories). The time period of
the business practices AA is challenging exceeds four years. The alleged antitrust
violations occurred in geographic markets in Europe as well as the United States. AA is
challenging the business practices of two GDSs (Travelport and Sabre) and an online
travel agency (Orbitz).
Discovery in the case will require the Court to expend significant resources. As
in all major litigations there is no doubt that issues relating to coordination and
scheduling will confront the Court. In addition, discovery in a case of this magnitude
will almost certainly result in some disputes over the scope of responses, privilege
2

See also In re Text Messaging Antitrust Litig., 630 F.3d 622, 629 (7th Cir. 2010) (complaint must show “a
sufficiently plausible case of price fixing to warrant allowing the plaintiffs to proceed to discovery”); Coss
v. Playtex Prods. LLC, 2009 WL 1455358, at *1 (N.D. Ill. 2009) (“Antitrust cases are typical of the types
of cases where discovery is so burdensome and costly to parties that a stay pending decision on a motion to
dismiss may be appropriate.”); DSM Desotech Inc. v. 3D Sys. Corp., 2008 U.S. Dist. LEXIS 87473, at *6
(N.D. Ill. 2008); (granting stay of discovery pending resolution of motions to dismiss because “[a]s the
Supreme Court, the Seventh Circuit, and this court have all recognized, discovery in any antitrust case can
quickly become enormously expensive and burdensome on defendants.”); In re Netflix Antitrust Litig., 506
F. Supp. 2d 308, 321 (N.D. Cal. 2007) (staying discovery pending resolution of motions to dismiss and
allowing very limited discovery during re-pleading because “the Supreme Court has recognized that staying
discovery may be particularly appropriate in antitrust cases”).

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designations, confidentiality, and a host of other issues. The number of potential disputes
will be exacerbated by the number of third parties involved in discovery, many of whom
may come to the Court in an attempt to limit their burden and costs.
In short, this case fits well within the long-line of antitrust cases where courts
have used their discretion to stay discovery pending a ruling on a motion to dismiss
because of the significant costs this discovery would impose.
2.

AA’s expedited discovery requests are not narrowly tailored

In addition to the Non-Exhaustive List of Document Preservation Categories
(“Non-Exhaustive List”) that AA will seek absent a stay of discovery, see App. at 8-10,
AA recently sent a letter to Travelport and Sabre counsel outlining the categories of
documents it wants on an expedited basis. See App. at 13-15 (attaching Rothman Letter
of June 10, 2011). Courts, however, will not grant expedited discovery unless the
proposed requests are narrowly tailored to an articulated, time-sensitive need. See
Dimension Data North America, Inc. v. NetStar-1, 226 F.R.D. 528, 532 (E.D.N.C. 2005)
(denying expedited discovery request that was not “narrowly tailored”); Philadelphia
Newspapers v. Gannett Satellite Info. Network, Inc., 1998 U.S. Dist. LEXIS 10511, at *6
(E.D. Pa. 1998) (same). AA’s recent letter request is neither narrow, nor tailored to a
specific need.
AA’s recent letter request outlines nine broad categories of documents that cover
Travelport’s U.S. and international operations. These requests go far beyond merely
asking Travelport to provide copies of documents produced to the DOJ or in the Illinois
contract litigation. AA seeks seven other categories of documents that are broader in
several respects and would require Travelport to conduct additional intrusive and
expensive document searches, collections, and reviews. For example, AA’s requests are
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not limited to Travelport’s U.S. operations. The alleged “retaliatory actions” highlighted
in the Amended Complaint occurred outside the United States and thus AA’s expedited
discovery requests cover Travelport’s international operations. See App. at 13-15, bullet
5 (Rothman Letter of June 10, 2011) (requesting documents about Travelport’s alleged
increases in AA booking fees and so-called “display bias,” both of which are based on
events occurring outside the United States).
The very fact that AA identifies seven categories of documents in addition to its
requests for the documents produced to the DOJ and in Illinois shows that AA wants
Travelport to bear the expense of collecting, reviewing, and producing documents
Travelport hasn’t already collected. This belies AA’s assertion that “Travelport … will
soon be producing to the DOJ largely the same documents that American will be
requesting.” AA’s Rule 16(a) Reply [Doc. No. 73] at 3. Moreover, AA asks Travelport
to bear the additional expense of collecting, reviewing, and producing these documents
on an expedited basis “in which the time to respond to discovery requests is shortened.”
Id. at 3.
AA’s proposed discovery appears to be designed to advance AA’s short term
commercial objectives and not any fast-track antitrust case to remedy consumer harm.
AA is seeking Travelport’s internal discussions and strategies for the renegotiation of the
AA-Travelport contract. See App. at 13-15, bullets 3-4 (Rothman Letter of June 10,
2011). While it is understandable that AA would like this proprietary information for the
current round of contract negotiations, this lacks any connection to any alleged antitrust
violation crying out for quick judicial intervention.

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Nor does AA’s letter say whether this is the full scope of discovery that AA
would seek on an expedited basis or before the dispositive motions are decided. Will AA
request depositions? Will AA request interrogatories? Will AA request third-party
discovery? Will AA revert back to its full “Non-Exhaustive List?” AA does not say.
IV.

AA Lacks a Compelling Justification for Immediate Discovery
The filing of a well-grounded preliminary injunction motion may, under proper

circumstances, justify tailored, expedited discovery. When the party seeking discovery
has not filed a preliminary injunction motion specifying the need for early judicial
intervention, courts deny expedited discovery as premature. See Edgenet, Inc. v. Home
Depot, U.S.A., Inc., 259 F.R.D. 385, 387 (E.D. Wis. 2009) (“Edgenet has not sought a
preliminary injunction or a temporary restraining order against Home Depot and, as such,
the claim to expedite discovery is premature”); Dimension Data, 226 F.R.D. at 531-32
(motion for expedited discovery is “not reasonably timed [when] plaintiff has not yet
filed a … motion for a preliminary injunction, setting out in detail the areas in which
discovery is necessary in advance of a determination of preliminary injunctive relief”);
Carter v. Ozoeneh, 2009 U.S. Dist. LEXIS 45679, at *8 (W.D.N.C. 2009) (denying
motion because “plaintiffs have not even filed a motion seeking preliminary injunctive
relief”).
Moreover, the possibility of a future preliminary injunction motion is not enough
to depart from standard federal practice. Time and time again, courts have refused to
allow expedited discovery on the basis of conjecture about a future injunction motion. El
Pollo Loco, S.A. de C.V. v. El Pollo Loco, Inc., 344 F. Supp. 2d 986, 991 (S.D. Tex. 2004)
(rejecting claim that expedited discovery is justified by “the possibility that Plaintiff
might seek injunctive relief in the future”); Dimension Data, 226 F.R.D. at 529, 532
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(refusing expedited discovery needed to “adequately prepare” for an anticipated
preliminary injunction); Momenta Pharms., Inc. v. Teva Pharms. Indus., 2011 U.S. Dist.
LEXIS 18562, at *6-7 (D. Mass. 2011) (refusing expedited discovery to support future
anticipated preliminary injunction motion).
AA’s sole justification for immediate antitrust discovery is that it “anticipate[s]”
preparing and filing a preliminary injunction motion in the future. AA’s Request for
Rule 16(a) Conference [Doc. No. 33] at 4. When would this preliminary injunction
motion come to light? It will “likely” be filed this summer if the parties are unsuccessful
in commercial negotiations to renew their contracts and Travelport continues to “refuse[]
to provide American with any assurances that it will cease engaging in further damaging
and anticompetitive conduct when those [contract] amendments expire.” Id.
AA all but admits that it currently faces no imminent harm that would justify
seeking a preliminary injunction for which expedited discovery would be necessary:
“Although the defendants complain that American has not specified the basis for the
preliminary injunction that it may be forced to file, American has not done so because it
does not yet know the precise punitive actions that Travelport (and Sabre) will take.” AA
Rule 16 Reply [Doc. No. 73] at 3; see also id. at 10 (“AA is not currently in a position to
predict what form the GDS Defendants’ retaliatory conduct will take this time…”).
Because AA does not yet know whether or on what grounds it would bring a preliminary
injunction motion, AA is trying to create as broad an evidentiary base as possible to
“prepare” for every possible preliminary injunction scenario. See id. at 14-15.
(“…immediate discovery is necessary to enable American to prepare . . . a motion for a

12

preliminary injunction . . ..”). This scatter-shot approach hardly qualifies as narrowly
tailored discovery.
Yet, AA seeks an expedited Rule 16(a) conference “to discuss American’s
anticipated motion this summer” and to “apprise the Court of anticipated preliminary
injunction proceedings.” AA’s Request for Rule 16(a) Conference [Doc. No. 33] at 1, 4.
The proper way to “apprise the Court” of these issues is to provide a well-founded
preliminary injunction motion, but AA chose not to do that.
AA’s legal grounds for a preliminary injunction also remain a mystery.
Presumably AA is not seeking a preliminary injunction on the grounds that Travelport
has monopolized product markets in the United States and Europe over more than four
years and has engaged in conspiracies to monopolize these markets with unnamed
coconspirators. Maybe the motion instead would deal with just one of the six counts of
the Amended Complaint. Maybe it would deal with a subset of factual allegations. The
underlying wrongs supporting a future preliminary injunction motion might be grounded
in antitrust, business torts, or contract – AA has not said.
All that AA has described is the ultimate relief it would seek in a preliminary
injunction case. The relief AA anticipates requesting is strange to say the least. AA
“would anticipate” seeking some form of an order by the Court providing “clear
assurance” that Travelport will not (1) “introduce any biasing to American’s flights in
their GDS displays,” (2) “terminate the underlying . . . agreements,” (3) “increase
American’s booking fees,” or (4) “otherwise change any other current practice or course
of doing business.” App. at 11-12 (attaching Rothman Letter of May 13, 2011); see also
AA’s Request for Rule 16(a) Conference [Doc. No. 33] at 6.

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None of these statements about anticipated preliminary injunction relief provide a
coherent framework for the Court to manage expedited discovery proceedings. First, the
display bias issue is hard to address because there are no underlying factual allegations
relating to display bias. The Complaint does not allege that Travelport has biased
displays in the United States or allege facts showing that Travelport has threatened to do
so. The Complaint contains a factual allegation of display bias in Europe, not the United
States. Nor does AA provide any explanation of what violation of law – antitrust,
business tort, or contract – supports injunctive relief on display bias.
Second, any request for a preliminary injunction barring “terminat[ion] of the
underlying . . . agreements” extends beyond anything said in AA’s 42-page Amended
Complaint. Missing is any allegation that Travelport has threatened to terminate the
agreement or that the exercise of contractual termination rights is a violation of antitrust
law or some form of a business tort. As AA’s brief recognizes, the agreements “expire,”
AA’s Request for Rule 16(a) Conference [Doc. No. 33] at 4, and thus there is no issue
concerning termination during the life of the agreement. Moreover, Travelport and AA
are already in contract litigation in Illinois state court. Any claims for preliminary
injunctive relief focusing on the duration of the contract or contractual termination rights
can be heard by the state court now handling the contract disputes.
Third, AA’s request for a preliminary injunction to freeze booking fees would at
least have some tangential connection to the antitrust complaint (the Amended Complaint
appears to seek treble damages based on alleged overpayment of booking fees) but this is
not a permissible antitrust remedy in an injunctive relief application in court, much less in
an expedited proceeding. A price freeze is not sought in the Amended Complaint; nor

14

could it be. Any price controls on travel distribution services would have to come from
Congress, U.S. Department of Transportation regulations, or a European regulatory
agency, not an order in a private lawsuit. There are myriad problems with court
regulation of pricing. Is AA the sole beneficiary of price controls or is this industry wide
pricing? What if Travelport’s input costs rise? What if its products or services are
enhanced? What is the time period for the price freeze? What countries?
For present purposes, the problem is that any injunctive relief related to the level
of booking fees would require substantial underlying fact discovery, evidentiary briefing,
and expert testimony. AA’s Amended Complaint alleges that Travelport charged high
booking fees over the years and asks for treble damages, apparently measured as the
difference between Travelport’s supposed “exorbitant” or “monopolistic” booking fees
and booking fees at the “competitive” level. Am. Compl. at ¶ 16 (“American has
suffered significant harm in the form of exorbitant booking fees”); id. at ¶ 113
(“Travelport [has] been able to maintain [its] per segment booking fees at monopolistic
levels, and American is entitled to recover the resulting overcharges.”). This kind of
heavy lifting would be part of the damages phase of a proven case of illegal
monopolization, not a rushed proceeding.3
Fourth, AA’s open-ended request that Travelport indefinitely freeze its business
practices – forbidding Travelport from changing “any other current practice or course of
3

The booking fees that AA now refers to as “exorbitant” or “monopolistic” are precisely the same heavily
discounted booking fees from the agreement that AA deemed “competitive” when it used its negotiating
leverage to demand them in 2006. See App. at 16 (attaching Press Release, Travelport, Galileo
International and American Airlines Sign New Five-Year, Full Content Distribution Agreements (May 7,
2006), http://travelport.mediaroom.com/index.php?s=43&item=208) (“‘Establishing a competitive
distribution agreement with Galileo helps us meet key business objectives to broaden the distribution of
American Airlines' fares at lower costs,’ said David Cush, senior vice president, Global Sales for American
Airlines. ‘With its broad travel agency subscriber base both offline and online, Galileo offers competitive
channels to providing a cost-effective and comprehensive distribution platform over the long-term.’”).

15

doing business” – can be quickly tossed aside. This type of all-encompassing mandatory
injunction is not a tenable court remedy and does not provide any guidance for the Court
to manage expedited, tailored discovery.
CONCLUSION
For the foregoing reasons, the Court should deny AA's request for the Court to
conduct a Rule 16(a) case management conference and grant Travelport's motion to stay
antitrust discovery pending a decision on its dispositive Rule 12(b)(6) motion to dismiss.

Dated: June 27, 2011

Respectfully submitted,
/s/ Michael L. Weiner____
Michael L. Weiner
[e-mail]
DECHERT LLP
1095 Avenue of the Americas
New York, New York 10036-6797
212.698.3608
212.698.3599 (Fax)
Mike Cowie
[e-mail]
Craig Falls
[e-mail]
DECHERT LLP
1775 I Street, NW
Washington, D.C. 20006-2401
202.261.3300
202.261.3333 (Fax)
ATTORNEYS FOR DEFENDANTS
TRAVELPORT LIMITED and
TRAVELPORT, LP

Of Counsel to Travelport Defendants:

/s/ Walker C. Friedman
Walker C. Friedman
State Bar No. 07472500
16

[e-mail]
Christian D. Tucker
State Bar No. 00795690
[e-mail]
FRIEDMAN, SUDER & COOKE, P.C.
Tindall Square Warehouse No. 1
604 East 4th Street, Suite 200
Fort Worth, Texas 76102
817.334.0400
817.334.0401 (Fax)
John T. Schriver
[e-mail]
Paul E. Chronis
[e-mail]
DUANE MORRIS LLP
Suite 3700
190 South LaSalle Street
Chicago, Illinois 60603-3433
312.499.6700
312.499.6701 (Fax)

17

CERTIFICATE OF SERVICE
I hereby certify that on the 27th day of June, 2011, I electronically filed the
foregoing document with the clerk of the court for the U.S. District Court, Northern
District of Texas, Fort Worth Division, using the electronic case filing system of the court.
The electronic case filing system sent a “Notice of Electronic Filing” to the attorneys of
record who have consented in writing to accept this Notice as service of this document by
electronic means.

/s/ Walker C. Friedman
Walker C. Friedman