Watch CBSN Live

JetBlue Probes Take Flight

The upstart discount airline JetBlue is under federal investigation and the target of a passenger lawsuit for passing personal information on 1.1 million flyers to a Defense Department contractor.

The contractor, Torch Concepts of Huntsville, Ala., produced a study, "Homeland Security: Airline Passenger Risk Assessment," that was purported to help the government improve military base security.

The Department of Homeland Security and the Federal Trade Commission announced Monday that they had opened investigations into the move, which according to The New York Times violated its own privacy rules. The Army is also reviewing the project.

The class-action passenger lawsuit, filed in Salt Lake City, alleges fraudulent misrepresentation, breach of contract and invasion of privacy.

JetBlue chief executive David Neeleman said Monday that the information contained "name, address and phone number, along with flight information, but absolutely no payment or credit card information."

The company announced it had ordered a review of its privacy practices by an accounting firm, Deloitte & Touche. It asserted that no information had been provided to any government agency.

The company said it was motivated by patriotism and the memory of the Sept. 11 attacks, according to The Times.

Utah attorney James W. McConkie filed the lawsuit Monday in 3rd District Court on behalf of five named plaintiffs and a representative class, seeking compensatory — but not punitive — damages.

"We got the sense that Mr. Neeleman wanted to make this right, so we commented in our lawsuit that we wanted to pursue the matter, but not in a way that would damage the financial viability of the company. It's a good company," McConkie said.

JetBlue spokesman Gareth Edmondson-Jones said Monday that he had not seen the lawsuit and was unable to comment.

The records were used to test a system using data mining to identify terrorist threats to military bases.

According to The Times, the company turned over 5 million files pertaining to 1.1. million customers who flew with the airline in 2001 and 2002. Torch, an Army contractor, compared the records to another database to get Social Security numbers, occupations and family size.

Homeland Security was probing whether government officials violated privacy laws as part of the project.

The FTC, meanwhile, said it was reacting to a complaint filed by the Electronic Privacy Information Center, a privacy watchdog.

"We take these allegations very seriously and will review the petition carefully," a commission spokeswoman, Claudia Bourne Farrell, told The Times. "The F.T.C. has been very active in the area of assuring consumer privacy."

The prospect of using computer databases to predict terrorist activity has raised concerns before.

The Pentagon had to scale back its Total Information Awareness program, which planned on developing ways of using private databases to predict terrorist activities and establish links between suspected terrorists. The program was renamed Total Information Awareness and its budget was restricted by Congress.

The Transportation Security Agency, meanwhile, has unveiled plans for a computer database called CAPPS II that will screen passengers and give them color codes based on their terror risk. The code will determine the security checks the passengers face, and even if they can board a plane, but no passenger will learn their code.

View CBS News In