Thousands of long-haul passengers affected by price-fixing by British Airways and Virgin Atlantic are finally set for a refund after three passengers dropped a challenge to a £73.5 million deal struck with the airlines by American class-action lawyers.

More than 100,000 British businesses and individuals have registered to claim a refund under the settlement reached in February last year. However, payment was delayed because of a legal challenge by three passengers who argued that a US court should not have jurisdiction over UK claims arising in the UK.

Yesterday Hausfeld & Co, one of the two US law firms that brought the lawsuit, said that an agreement had been reached with the objecting passengers and that the refunds would now proceed. Michael Hausfeld, chairman of the firm, said: “While disappointed that this unprecedented objection had been raised in the first place, we are pleased that a settlement has been reached, meaning that refunds will now be processed promptly.”

About 5.6 million British passengers were believed to have been affected by collusion between the airlines on fuel surcharges applied to transatlantic flights between August 2004 and January 2006. Those who have not yet claimed a refund have until December 2012 to do so. The refund amounts to about £13 a ticket.

The class-action lawsuit was filed after the airlines admitted price-fixing following an investigation in the US and the UK.

In 2007 BA was fined £121.5 million by the Office of Fair Trading, Britain’s competition watchdog, and $300 million by the US Department of Justice. Virgin Atlantic escaped financial punishment because it came forward to expose the collusion.

Flights suffer

The number of passengers flying from UK airports plummeted last month because of the economic crisis and the weak pound. Traffic at key airports, including Heathrow, Gatwick and Stansted, fell 11.3 per cent in March. Gatwick was worst hit, with 17.7 per cent fewer passengers than a year earlier.

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