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Orbitz Asked to Cough Up Biz Docs

The government is continuing to look into the possibility of anti-competitive practices at online travel operation Orbitz, but the airline-backed site says the action is "nothing new" and in fact its success has stimulated competition.

The U.S. Department of Transportation, which last April signed off on the launch of the travel site, is now asking Orbitz to provide more documentation on its business plan and its contracts.

Sixteen consumer and antitrust advocacy organizations had urged the DOT to block the joint venture.

Now, the DOT's request also extends to the five airlines that own Chicago-based Orbitz, its business partners and several competitors, according to a letter from the agency that was leaked to the Associated Press.

"We seek to determine whether the terms of participation in Orbitz are unreasonably restricting competition in the airline and airline distribution businesses," said the letter, which was signed by the agency's assistant secretary for Aviation and International Affairs, Read C. Van de Water.

Jeff Katz, Orbitz president and CEO, called the DOT action an "informal study of the online travel industry," and said that "Orbitz welcomes the DOT's comprehensive study ... The DOT review is nothing new; in fact in a previous review Orbitz was cleared of any anti-competitive issues."

"Orbitz has, in nine short months, energized the competition and compelled other online travel players to improve their offerings and all travel sites have benefited through increased consumer acceptance," Katz said.

Orbitz officially launched last June and in November, in a mandated report to the government, said sales were at an all-time high. However, Dallas-based Southwest Airlines is suing the company for alleged false advertising and unfair competition. Orbitz is backed by American, United, Northwest, Delta and Continental.

Online travel agency rivals Travelocity.com Inc. and Expedia Inc. have complained that Orbitz' airline owners withhold some so-called Web fares, the heavily discounted tickets promoted on their own Internet sites.

The DOT is asking for a month-by-month breakdown of airline ticket sales, the percentage derived from Web-based fares and which airlines offered them. It also wants to know what deals if any have been offered in order to obtain access to Web fares.

On the Web fare issue, Katz said that "Since our launch ...Web-only fares have become available to multiple players in our industry. Orbitz early success confirms that consumers applaud our approach to offering unbiased, comprehensive flight information and options."

"We welcome continued competition in the online agency marketplace and are confident that this study will reaffirm our pro-competition, pro-consumer position," he said.