The jury, which heard the case in the US District Court, Southern District of New York, returned a verdict in favor of US Airways for $5 million in damages before trebling on one of the carrier’s claims.
Sabre’s appeal, filed in the U.S. Second Circuit Court of Appeals, asserts that the verdict was based on incorrect legal standards and an inaccurate framework to assess the case.
Sabre cited “numerous errors of law” by the trial court, including jury instructions that were inconsistent with higher court rulings and the erroneous exclusion of key evidence.
A major element of Sabre’s appeal is the District Court’s refusal to follow the Second Circuit’s precedent set in its decision in the US v. American Express (Amex) case.
That case determined that Amex operated in a two-sided market in which contract provisions were designed to protect competition by ensuring that one side of the market (merchants) did not discriminate against the defendant’s customers on the other side of the platform (cardholders).
US Airways had previously cited the federal government’s case against Amex as precedent for its own claim that Sabre’s contract provisions were anticompetitive.
Sabre also identified the following as other errors by the District Court:
• No reasonable jury could have concluded that the challenged provisions were anticompetitive because the provisions only prevented discrimination against Sabre and therefore could not exclude efficient competitors.
• The District Court improperly lowered US Airways’ burden of proof by instructing the jury that Sabre was liable if the challenged provisions had the potential to harm competition, rather than if it actually harmed competition.
• US Airways’ causation theory was chronologically impossible: there could be no causal link between the effects of the challenged conduct (the provisions in the 2011 agreement) and the alleged injuries (the price set forth in the same 2011 agreement) as those booking fees were set before the challenged provisions took effect.
• The District Court erred by excluding evidence about US Airways’ “sign-and-sue” strategy. Sabre said that evidence would have shown that US Airways was not coerced into signing the 2011 agreement.
Rather, Sabre argued, the carrier was seeking to set Sabre up by asking for certain provisions in the contract, then filing the lawsuit just two months later.