Travelport, LP v. American Airlines, Inc.
2011 IL App (1st) 111761
Ill. App. Ct.2011Background
- Travelport operates a global distribution system (GDS) and earns revenue when agencies book flights via its system.
- In 1993 Travelport began carrying American flight data; in 2006 the Preferred Fares Agreement (PFA) guaranteed Travelport access and, for five years, prohibited American from removing Orbitz’s ticketing authority.
- In 2008 American sought to replace GDSs with its own system and asked Orbitz to use it directly; no agreement was reached.
- On Nov. 1, 2010 American notified Orbitz it would terminate Orbitz’s ticketing authority, potentially Breaching the PFA.
- Travelport sued American for anticipatory breach and sought a preliminary injunction to preserve Orbitz’s ticketing authority; after an initial denial, a successor judge granted the injunction on reconsideration.
- The parties later extended Orbitz’s ticketing authority beyond Sept. 1, 2011, raising mootness questions for this interlocutory appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Travelport has a protectable interest to sue for breach of the PFA. | Travelport has standing to pursue breaches of the PFA and related covenants. | Travelport lacks a stand-alone, protectable interest distinct from Orbitz. | Travelport has a protectable interest; standing is affirmed. |
| Whether Travelport showed irreparable harm without injunction. | Termination would lead to loss of bookings, revenue, customers, and goodwill. | Harm is speculative and damages would be adequate. | Irreparable harm shown; presumption applies once a protectable interest exists. |
| Whether the trial court properly considered likelihood of success on the merits and the balance of equities. | PFA impliedly guarantees Orbitz access; Travelport would likely succeed on the merits. | PFA does not expressly preclude revocation of Orbitz’s authority; equity favors American. | Fair question on likelihood of success; balance of equities supports injunction. |
| Whether the successor judge properly reconsidered without live testimony. | Reconsideration was proper; error by prior judge should be corrected. | Live testimony not required; due process concerns not preserved by objection. | Correct to reconsider; no reversible error in entering injunction. |
Key Cases Cited
- Mohanty v. St. John Heart Clinic, 225 Ill. 2d 52 (Ill. 2006) (standing and likelihood of success considerations in preliminary injunctions)
- Gannett Outdoor of Chicago v. Baise, 163 Ill. App. 3d 717 (Ill. App. 1987) (irreparable harm when loss of goodwill and future business is at stake)
- Falcon, Ltd. v. Corr’s Natural Beverages, Inc., 165 Ill. App. 3d 815 (Ill. App. 1987) (irreparable injury from loss of future sales and reputation)
- Gold v. Ziff Communications Co., 196 Ill. App. 3d 425 (Ill. App. 1989) (irreparable harm and preservation of status quo in contract disputes)
- Cameron v. Bartels, 214 Ill. App. 3d 69 (Ill. App. 1991) (presumed irreparable injury when protectable interest exists)
- Wexler v. Wirtz Corp., 211 Ill. 2d 18 (Ill. 2004) (standing as a matter of law burden on movant)
- Brandon v. Bonell, 368 Ill. App. 3d 492 (Ill. App. 2006) (trial court’s authority to reconsider wrong rulings; deference to process)
- Kalbfleisch v. Columbia Community Unit School District Unit No. 4, 396 Ill. App. 3d 1105 (Ill. App. 2009) (equitable considerations and standard for preliminary relief)
- Clinton Landfill, Inc. v. Mahomet Valley Water Authority, 406 Ill. App. 3d 374 (Ill. App. 2010) (fair question and balance-of-equities framework for injunctions)
- Save the Prairie Society v. Greene Development Group, Inc., 323 Ill. App. 3d 862 (Ill. App. 2001) (standard for evaluating preliminary injunctions and fair questions)