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Travel Agents, Scared at Commission Losses, Fight Back

February 21, 1995

TRENTON, N.J. (AP) _ Travel agents are taking their case to the courts, as well as the court of public opinion, in a fight to get the airlines to remove a $50 cap they placed on ticket commissions earlier this month.

The American Society of Travel Agents announced a strategy today that will include legal action, legislative efforts and a public ad campaign.

Virtually every major U.S. airline announced last week that in order to cut costs they are capping commissions to agents on domestic ticket sales. The airlines will now pay agents up to $25 for one-way tickets and $50 for round trips, instead of a 10 percent commission on each ticket.

``We are filing an antitrust, class action lawsuit against the major carriers alleging price-fixing,″ said Jeanne Epping, ASTA president and chief executive officer.

At a news conference at ASTA’s headquarters in Alexandria, Va., the group said it would seek a restraining order to stop the airlines’ cuts, and would ask its members to meet with their congressmen to press their case.

ASTA officials said they have not yet determined when and where the lawsuit will be filed. But a national advertising campaign touting the services of travel agents is to kick off Friday with ads in the Wall Street Journal and USA Today, Epping said.

After the airlines’ announcement, some large travel agencies decided to start charging customers a fee for booking. But smaller agencies fear if they impose fees customers will bypass them and book their flights directly with the airlines or through on-line computer services.

At least one lawsuit has been filed so far, and in the past week some 2,000 angry travel agents met in New York City and about 500 more gathered at a hotel in Beverly Hills, Calif., before protesting on nearby Wilshire Boulevard.

In Torrance, Calif., a new group called Coalition for the Traveling Public says it has enlisted about 2,000 agencies in Florida, Illinois, Minnesota and New York to fight the cap.

The Association of Retail Travel Agents is organizing a trip to Washington to lobby Congress and the White House on Thursday.

New Jersey travel agents are asking consumers to sign a petition addressed to U.S. Transportation Secretary Federico Pena and members of Congress, saying travelers don’t want to have to pay fees or make their own bookings, said Debbie Donofrio, who organized a meeting of 250 irate travel agents in Newark on Feb. 13.

``There are some smaller agencies that said they’ll just close their doors and others that said they’d just cut back on their staffs,″ Donofrio, owner of Boulevard Travel in Boonton, said Monday. She said she may have to lay off half of her six employees.

ASTA’s 24 directors met in Washington and discussed the cap over the weekend.

``We’re still really analyzing the data, but the impact is severe,″ said Dick Knodt, executive vice president of ASTA, based in Alexandria, Va. He said agents handle 85 percent of all airline tickets in the country.

``Two-thirds of the average agent’s revenues are generated by airline commissions,″ Knodt said.

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