American Airlines Canceled My Family’s Tickets—Then Didn’t Answer My Reply To Regulators

American Airlines has let the deadline its final reply in my Department of Transportation complaint pass without offering any last defense. The airline had canceled award tickets I’d booked for my family nearly three weeks after issuing them. These were ‘mistake fare’ tickets – the airline had been pricing multi-city awards at a discount (just the cost of the first segment) for several weeks, and the Department of Transportation lets them cancel mistake fares under terms consistent with their contract of carriage. I’ve always believed that it’s reasonable to cancel a mistake promptly. I’ve written about that for over a decade. I’ll book a fare because if an airline is letting people fly, say, to Paris for $60 I’d like to be one of those people. But if they promptly cancel, I figure it’s no harm, no foul. The Department of Transportation has rules that an airline has to make a customer whole for any reasonable nonrefundable expenses incurred in reliance on the fare. I intentionally do not make any of those – I wait to see whether the trip will be honored first. (This is another reason why any cancellation needs to happen promptly.) American set rules precisely around this – they give themselves 72 hours after discovering the mistake. They set it this way intentionally favorable to themselves – it’s not 72 hours from booking, but from whenever they discover the issue which could come later. American broke its own rules, taking about two weeks to cancel the tickets after they discovered the error. My hunch is a middle manager thought they could handle things themselves without really escalating the issue and bungled it. American writes the rules. I believe they should at least have to follow their own rules. Consumers get 24 hours after booking to cancel a ticket they purchase such as when they make a mistake (with a bunch of caveats), American gives itself much more generous terms, they should at least follow those terms. American Airlines Files Its Defense I complained to the Department of Transportation that American was violating its Contract of Carriage. In their response to my complaint, American’s position was the redemption pricing was a mistake, AAdvantage terms let them cancel mistakes, and consumers shouldn’t be allowed a windfall. American says that their AAdvantage Terms are “the beginning and the end of this case.” Plus, consumers don’t have any rights. Legally, they can sue an airline only for breach of its own terms – the Supreme Court has said for anything else, go to the Department of Transportation. American’s position it consumers can’t go to the Department of Transportation (they have ‘no private right of action’). American’s Position Is Legally Shaky I responded to American’s arguments that the terms American wrote incorporate American’s Conditions of Carriage and International Tariff and specifically say those agreements take priority in a conflict. So they have to follow the rules they set out in those documents. They give themselves the right to cancel mistakes, but give themselves a deadline to do so. They didn’t want a short deadline after booking, so they gave themselves 72 hours after whenever they discover the error. That’s a standard favorable to them. But they still took about two weeks after they admit discovery to cancel. American quotes its general right to correct mistakes in its reply, while ignoring any discussion of the deadline it wrote for itself – never explaining why that deadline doesn’t apply. They claim there’s fundamentally nothing unfair or deceptive about correcting a “windfall.” I accepted American’s right to cancel promptly in my complaint. The practice I challenged is leaving issued tickets in place after their own cancellation period expired, then cancelling after the deadline they set passed. The Department has treated misleading contractual protections as an unfair and deceptive practice in the past. In Gurevich v. Alitalia, it found the airline misled passengers by publishing protections in its conditions of carriage and invoking inconsistent tariff provisions to deny them. Here, the Conditions and Tariff both promise the same cancellation deadline, yet American claims an unrestricted right to cancel under the AAdvantage Terms which they say give them a right inconsistent with the Contract of Carriage and Tariff (but they don’t, since the AAdvantage terms say that when there’s a conflict, those other agreements trump). American Says Consumers Don’t Even Get To Complain To The DOT American claims I lack a private right of action against them. They can unilaterally act against a passenger, and the passenger doesn’t get to do anything about it. That’s actually irrelevant here because I’m not suing them. I’m not taking action against them, I’m asking the Department of Transportation to investigate. British Airways tried a similar move and the Department rejected this defense in Edelman v. British Airways, explaining that the Secretary’s authority to investigate made defenses about an individual consumer’s standing and rights irrelevant. Why American May Not Have Bothered To Respond It seems to me that American’s lawyers made bad arguments here, probably because they really did break the rules they set so they don’t actually have good arguments. But American will still probably win, because it’s up to the Department of Transportation to choose whether to do anything about it or not. My hunch is that the American already knows that they aren’t going to. The Department of Transportation set a deadline of November 13 for American Airlines to respond with a reply to my response. American did not even offer one. When there’s a formal rulemaking, communications with the Department have to go through the docket or at least get logged in the docket. The same goes for an actual enforcement action. Neither one is the case here at this point. Ex parte communications aren’t prohibited prior to the commencement of an enforcement action. 14 C.F.R. § 300.2(c)(3) allows “Communications made in the course of an investigation to determine whether formal enforcement action should be begun.” So American’s lawyers can discuss the allegations and argue against commencing enforcement outside the docket. After enforcement proceedings begin there’s a requirement for communications with decision-making staff to occur on the record (with any ex parte communications recorded, with notice given to the parties), but not before commencement. So it’s possible that American Airlines has had offline conversations with the department about this issue and they believe they’ve convinced DOT not to pursue an enforcement action – no need for an on the record response. I don’t have evidence this is the case, but it’s exactly the scenario I was expecting if they didn’t respond by the deadline. DOT will ultimately need to either pursue an enforcement action, or explain why they aren’t doing so. But in practice there’s really no timeframe in which that has to happen. DOT can choose to sit on this for years. Honestly, though, I expected American’s lawyers to just try to muddy the issue, and say something like: Sure the Contract of Carriage sets a 72-hour expectation but doesn’t limit the right to cancel, those are separate. We did not meet the 72-hour deadline, but there’s no consequence for that failure. The Department’s 2015 policy on regulatory discretion for mistake fares did not specifically require action within 72 hours, DOT policy is to allow mistakes to be cancelled. I do not think this is at all true or close to what American’s own policies say. And it doesn’t require multiple biglaw partners to come up with it. The fact that they do not even bother to say this tells me they are confident of how DOT will (not) act. They can ignore their Contract of Carriage with impunity if the vibes are right and DOT sympathizes with them. Just last month, the Department of Transportation said “Under @SecDuffy , DOT will always stand up for passengers by holding airlines accountable” – we will see whether that’s true. Topics on this page