NWA Seeks Legal Action Over Amex Payments

Northwest Airlines and American Express are negotiating through a dispute in which American Express is withholding as much as $63 million in Northwest tickets purchased by customers using American Express credit cards, according to documents filed as part of the airline's bankruptcy proceedings.

The two parties "are conducting negotiations with respect to, among other things, the amount of deposits, if any, to be held by American Express in connection with the sales of tickets on Northwest by customers using the Amex credit card," according to a Northwest statement. "Pending completion of the negotiations, Northwest is seeking court action to ensure that American Express pays Northwest what it owes under the terms of their contract."

An American Express spokesperson refused to comment on the specifics of the dispute, or to even acknowledge that it centered on a decision reportedly made by American Express regarding credit card purchases, following Northwest's bankruptcy filing two weeks ago. "We are working toward an agreement to provide American Express with an appropriate level of protection," the spokesperson said. "We have years of experience in working with airlines in difficult circumstances."

According to documents filed yesterday in the U.S. Bankruptcy Court in New York City, American Express Travel Related Services Co. has been ordered to respond during a Monday hearing to a Northwest motion forcing American Express to comply with the terms of their contract. The court said American Express specifically must show cause for "modifying or withholding performance under the agreement or exercising possession or control over monies due."