Gogo shares rebound after American Airlines drops lawsuit

American Airlines and Gogo lawsuit

American Airlines has dropped its lawsuit against in-flight WiFi provider Gogo, and the company’s shares jumped nearly 10% on Monday.

Gogo shares

The lawsuit filed by American Airlines included 200 of its aircraft.

Gogo and American have a contract through 2018, however, the airline is hoping to receive an upgrade from its current 3G connections.

Under terms of the current contract, if American receives a better proposal, Gogo must make a counteroffer to improve its technology

The lawsuit had asked a judge to give Gogo official notice that American was considering a competing product.

American Airlines claims that ViaSat, a provider on United Airlines, JetBlue, and Virgin America, offers significantly faster internet speeds.

Gogo said in a regulatory filing that it “looks forward to presenting a proposal to install 2Ku, our latest satellite technology.”

Gogo’s 2Ku technology uses satellites and complex onboard antennas to deliver a much better Wi-Fi experience for flyers. When equipped with 2Ku airplanes receive a 70 megabit-per-second connection, which is about four times faster than the average home broadband connection.

“If Gogo chooses to submit a proposal in response to a competitive offering, we will evaluate it,” said Casey Norton, communications director for American.