Australia’s Qantas says regulator lawsuit ignores reality as it files defence

By Byron Kaye and Sameer Manekar

(Reuters) -Qantas Airways said a regulator lawsuit accusing it of illegally selling thousands of tickets for cancelled flights ignores business realities, adding that most impacted travellers were put on other flights or reimbursed.

The Australian Competition and Consumer Commission (ACCC), which sued the country’s flagship carrier in August, has said that in some cases, flights were on sale for several weeks after cancellation.

“The ACCC’s case ignores a fundamental reality and a key condition that applies when airlines sell a ticket,” Qantas said in a statement on Monday.

“While all airlines work hard to operate flights at their scheduled times, no airline can guarantee that,” it added, noting weather conditions and other unforeseen problems make delays and cancellations “inevitable and unavoidable”.

In its defence filed to the Federal Court, Qantas said it was responsible for “many unacceptable delays” as it sought to restart international travel in 2022 after COVID restrictions were lifted.

But it added that its actions never amounted to charging a “fee for no service”, as the ACCC has accused it of doing, “because customers were reaccommodated on other flights as close as possible to their original time or offered a full refund”.

The ACCC declined to comment, saying the matter was before the court.

Qantas customers have amassed hundreds of millions of dollars in credits for cancelled flights that were due to expire in December. After the ACCC lawsuit was filed, Qantas said it was removing the expiry date. The company’s statement on Monday did not refer to its initial plan to impose an expiry date.

Qantas’ previous CEO brought forward his retirement and its chairman has said he will quit next year, both citing the ACCC lawsuit as the reason for their departure.

The lawsuit is one of several sensitive topics that Qantas is expected to be asked about at its annual meeting on Nov. 3, where groups like the Australian Shareholders’ Association have said they plan to vote against many of its resolutions. These include resolutions relating to remuneration for management and the re-election of some board members.

The airline lost a civil lawsuit in September which found it illegally fired 1,700 ground staff in 2020 and replaced them with contractors specifically to prevent industrial action. A court is still to decide penalties for that case.

Qantas has also been accused of quashing competition when it lobbied the federal government, successfully, to stop rival Qatar Airways from selling more flights to Australia.