Second class action over $1.2bn Qantas flight credits could be lodged in weeks, court told

Qantas has been in the news for all the wrong reasons, and a second class action over cancelled flights only adds to the embattled airline’s woes.

A second class action lawsuit over Qantas’ handling of cancelled pandemic fights has been flagged, a court has been told.

Echo Law lodged a case in the Federal Court seeking refunds and compensation for passengers whose flights were cancelled due to Covid-19 in August.

But during a case management hearing on Thursday, Justice Bernard Murphy was told a second proposed class action, by law firm Piper Alderman, was in the works.

Barrister Thomas Bagley, for Piper Alderman, said the firm had spent the past six months investigating the national carrier, and expected it would be ready to file a case in the coming weeks.

The case against Qantas alleges it treated money from the cancelled flights as a “interest-free loan”. Picture: NCA NewsWire / Damian Shaw

“The proposal is to file a competing class action in the very near term, I anticipate in the next two or three weeks,” he told the court.

“I expect it will substantially overlap with the group definition in the Echo Law proceeding.”

Oren Bigos KC, for Echo Law, opposed allowing time for the two firms to discuss how to handle the competing cases, saying delaying the case for a “vague proposal” wasn’t in the interest of Qantas’ customers.

“It’s unfair if the mere proposal of a competing case would be able to jeopardise a timeframe,” he said.

Justice Murphy disagreed, ordering Piper Alderman to file its case, if it plans to do so, by October 27.

He ordered the two firms to negotiate a consolidation of the two cases and warned it was not in the customers’ interest for this to become an “expensive and wasteful” competition.

“Legal firms hate being forced into a consolidation,” Justice Murphy said.

“But when they seem to get on with a job it’s efficient and less wasteful … But I won’t force two parties together who don’t want to be together because you would have to work co-operatively.”

Earlier this year, Qantas revealed customers could claim a cash refund for flights cancelled during the pandemic. NCA NewsWire / Gaye Gerard

Echo Law’s case alleges Qantas breached its contracts by providing travel credits worth $1.2bn for cancelled flights and received “unjust enrichment”.

Dr Bigos told the court the airline had benefited financially by holding on to the money for “months and years” and should provide customers compensation.

Ruth Higgins SC, for Qantas, said the carrier had made its position clear since August 3. The airline was now offering affected customers refunds and it expected the “pool will diminish over time”.

“Qantas is keen to refund its customers,” she said.

“Consumers can come to Qantas and get the refund directly … We want our consumers to get their money back.”

She told the court about $700m had already been refunded, with a balance of about $517m outstanding.

Originally published as Second class action over $1.2bn Qantas flight credits could be lodged in weeks, court told