(Adds comment from United Continental Holdings spokeswoman,
By Sarah N. Lynch
WASHINGTON Dec 2 United Airlines' parent
company will pay $2.4 million to resolve civil books and
records violations after it reinstated an unprofitable flight
route to accommodate the chairman of the Port Authority of New
York and New Jersey, the U.S. securities regulator said.
The U.S. Securities and Exchange Commission said United
Airlines' decision in December 2011 to add a nonstop flight
between Newark, New Jersey and Columbia, South Carolina for then
chairman David Samson's personal benefit harmed shareholders,
who were forced to foot the bill.
The SEC said its investigation would continue.
Megan McCarthy, a spokeswoman for United Continental
Holdings, said the company is pleased to have resolved the
The SEC's civil case against United Airlines marks the
latest in a series of legal actions involving the airline and
Samson, who at one time was a close confidant of New Jersey
Governor Chris Christie.
In July, Samson pleaded guilty in a parallel criminal matter
for using his position to try to pressure the airline to
accommodate his travel with a more convenient flight path, which
prosecutors said Samson called the "Chairman's
At the time, the airline separately agreed to pay a $2.25
million penalty as part of a non-prosecution agreement with the
government that also mandates improvements in the company's
The investigation into Samson and United Airlines grew out
of a probe into the now infamous "Bridgegate" scandal in New
Jersey, in which political associates of Christie shut down
lanes on the George Washington Bridge.
Last month, two of those associates were convicted for their
roles in the lane closures.
The airlines scheme involving Samson is unrelated to the
lane closures on the bridge.
The SEC said on Friday that the flight route between New
Jersey and South Carolina had previously been canceled by
Continental - before its merger with United Airlines - because
of poor financial performance.
Despite knowing the route was a money-loser, the airline
caved to pressure by Samson to reinstate it amid concern that
crossing him could harm its business interests.
The SEC added that it "circumvented its standard process for
initiating new routes" and brought it back, costing the company
approximately $945,000 before it ceased again.
(Reporting by Sarah N. Lynch; Editing by Grant McCool)