BA and Virgin told to refund 8m passengers

BA and Virgin air passengers who overpaid for their tickets following the airlines' decision to collude on raising the cost of a fuel surcharge are to be refunded from today.

The eight million customers affected will be able to claim back about £10 each.

US law firm Cohen, Milstein, Hausfeld & Toll negotiated a settlement with the companies which will provide $59 million (£30 million) for American passengers and £73.5 million for UK passengers who bought tickets from either British Airways or Virgin Atlantic between August 11th, 2004 and March 23rd, 2006.

The settlement is a result of a class action lawsuit launched by the firm on behalf of passengers who overpaid on tickets during the period.

Michael Hausfeld, senior partner at Cohen Milstein, said: "We are delighted to have achieved such a terrific settlement for consumers.

"BA and Virgin overcharged their customers for almost two years, and this settlement recovers 100 per cent of that unlawful overcharge - with no deductions for attorneys' fees or other costs."

In 2004, BA and Virgin increased the price of a 'fuel surcharge', which the companies claimed covered the rising costs of fuel.

But subsequent investigations from the UK's Office of Fair Trading and the US Department of Justice found the companies had conspired to fix the price of the charge.

Both companies were told to pay fines, although Virgin escaped a penalty as it broke the cartel by whistle-blowing to the authorities.