West Jet admits improper access to Air Canada
05-29-2006, 07:16 AM
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West Jet admits improper access to Air Canada
Welll dang, if you want a step up on the competition, this be how you do it
By Robert Melnbardis
MONTREAL (Reuters) - WestJet Airlines (WJA.TO: Quote) admitted on Monday that it had improperly gained access to Air Canada's key flight operations data and apologized as the two rivals settled a two-year-old legal dispute over the issue.
WestJet said its conduct in the matter, which took place in 2003-2004 as Air Canada was restructuring under bankruptcy protection, was "unethical and unacceptable."
In a two-paragraph joint statement, WestJet apologized to Air Canada and to Robert Milton, chief executive of Air Canada's parent company, Aviation Holdings (ACEb.TO: Quote).
Montreal-based Air Canada had sued WestJet for C$220 million over allegations that the Calgary, Alberta-based no-frills carrier had repeatedly and covertly gained access to a password-protected Air Canada Website for employees.
In its lawsuit, which dates back to April 2004, Air Canada alleged that WestJet had used the Website access to download details about Air Canada's flight operations, such as how many seats were filled on certain flights.
"This practice was undertaken with the knowledge and direction of the highest management levels of WestJet and was not halted until discovered by Air Canada," the companies said in a joint statement.
WestJet agreed to pay Air Canada's legal costs of C$5.5 million ($5 million) and accepted the latter's request to donate C$10 million to children's charities.
Although WestJet had previously denied wrongdoing, the scandal reverberated through WestJet's top management ranks.
Mark Hill, a co-founder of WestJet and former vice president of strategic planning, resigned in July 2004.
In November 2004, Clive Beddoe, president and chief executive of WestJet, told reporters he had offered to resign over the case, but the airline's board refused to consider it.
ACE class A shares were up 30 Canadian cents at C$32.75 in early trading, while WestJet shares jumped 40 Canadian cents, or 3.6 percent, to C$11.48 on the Toronto Stock Exchange.
By Robert Melnbardis
MONTREAL (Reuters) - WestJet Airlines (WJA.TO: Quote) admitted on Monday that it had improperly gained access to Air Canada's key flight operations data and apologized as the two rivals settled a two-year-old legal dispute over the issue.
WestJet said its conduct in the matter, which took place in 2003-2004 as Air Canada was restructuring under bankruptcy protection, was "unethical and unacceptable."
In a two-paragraph joint statement, WestJet apologized to Air Canada and to Robert Milton, chief executive of Air Canada's parent company, Aviation Holdings (ACEb.TO: Quote).
Montreal-based Air Canada had sued WestJet for C$220 million over allegations that the Calgary, Alberta-based no-frills carrier had repeatedly and covertly gained access to a password-protected Air Canada Website for employees.
In its lawsuit, which dates back to April 2004, Air Canada alleged that WestJet had used the Website access to download details about Air Canada's flight operations, such as how many seats were filled on certain flights.
"This practice was undertaken with the knowledge and direction of the highest management levels of WestJet and was not halted until discovered by Air Canada," the companies said in a joint statement.
WestJet agreed to pay Air Canada's legal costs of C$5.5 million ($5 million) and accepted the latter's request to donate C$10 million to children's charities.
Although WestJet had previously denied wrongdoing, the scandal reverberated through WestJet's top management ranks.
Mark Hill, a co-founder of WestJet and former vice president of strategic planning, resigned in July 2004.
In November 2004, Clive Beddoe, president and chief executive of WestJet, told reporters he had offered to resign over the case, but the airline's board refused to consider it.
ACE class A shares were up 30 Canadian cents at C$32.75 in early trading, while WestJet shares jumped 40 Canadian cents, or 3.6 percent, to C$11.48 on the Toronto Stock Exchange.
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