American Airlines Says It Can Cancel Tickets If Customers Get A ‘Windfall’ Deal, Doesn’t Have To Follow Rules

American Airlines canceled award tickets I’d booked for my family and me nearly three weeks after issuing them. 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. But American’s own rules require them to do it within 72 hours of discovering the mistake. I filed a DOT complaint because American didn’t follow those rules, waiting weeks to cancel. The airline has now responded. Their lawyers say the airline can cancel an award whenever it wants, and asks the Department to dismiss my complaint. In their response they never explain why they aren’t bound by the rules they wrote. I suspect their lawyers were just phoning it in, drawing on a template they used responding to other passenger complaints. Maybe they didn’t even read the arguments in the filing they were answering. The opening argument in their answer is the same one they submitted in response to another passenger’s complaint six days earlier – right down to an example about how many tickets that passenger booked. American Waited Weeks To Cancel The Tickets They Sold For a period of time, American’s multi-city award search produced some extraordinary prices. I wrote about what happened here. Some international itineraries priced at the cost of the first domestic segment, even though the long haul flights were included. I booked three roundtrips: a family trip to Australia, a family trip to Italy, and a trip to New York for myself. Australia was 24,500 miles per person outbound and 10,000 miles returning, with business class across the Pacific. Italy was 12,500 miles per person each way, with business class across the Atlantic. The New York trip included a chance to say goodbye to American’s Airbus A321T Flagship First Class. American initially showed a higher mileage price during the booking process. Then the final payment page showed the lower price and I paid it. I knew these weren’t normal price. I booked because sometimes airlines honor deals like this, and if they do, I’d like to be among those who get to travel. American honored $450 business class tickets to China. Other times airlines cancel, and I’ve long written that was fine when they acted promptly. American says they discovered the issue two days after I booked. They cancelled my tickets nearly three weeks on. American Wrote A 72-Hour Rule For Itself The Department of Transportation has a rule against increasing the price of a ticket after purchase. In 2015, it announced that it would exercise enforcement discretion for mistake fares: an airline can cancel rather than honor the price if it demonstrates the mistake, refunds the ticket, and reimburses reasonable, actual, verifiable expenses incurred in reliance on it. That doesn’t mean an airline gets to ignore whatever procedures it sets for doing this. American’s conditions of carriage say that when it issues a mistaken fare, it will void the ticket, refund the customer and provide notice within: 72 hours after we learn of the mistaken fare The point of this is to make clear they can cancel once they discover the error – not based on the time from booking, in case they don’t discover it right away. Their international tariff has a similar provision. In its answer to my complaint, American admits that more than 72 hours had already passed when it canceled. American’s Lawyers Found One Sentence They Like American’s answer to my complaint says that its AAdvantage terms let it revoke a benefit issued in error, even after it has been redeemed. They claim that’s “the beginning and the end of this case.” That’s only a convincing argument if you don’t read any of the other terms. Those same AAdvantage rules say award travel is subject to the operating airline’s contract of carriage and tariffs. And when the general program terms conflict with an agreement specific to the service purchased, the specific agreement governs. That means it’s the Contract of Carriage (in the case of the two international trips) the international tariff. American gives itself a general right to correct an error and a specific process it has to follow when it wants to cancel an issued ticket. American wrote both of those. Its lawyers quoted the first one and skipped the language that talks about how the agreements fit together. Later in the complaint, they say the documents “speak for themselves.” They do. They say 72 hours. And their lawyers never even try to explain why that language doesn’t govern these tickets. They just say AAdvantage members aren’t entitled to a “windfall” from a technical error. And they have the right to cancel in that case! They just have to follow their own procedures when they do it! The opening section of American’s answer is the same as the opening section it filed in another case, including a reference to one customer booking eleven awards for sixteen tickets – referencing the bookings in that other complaint, not mine. That’s just bad lawyering. My Response To American I’ve asked the Department for permission to submit my reply, and included the reply. American denies my complaint’s legal conclusions, but never addresses why. They also claim I have no ‘private right of action’ against them for unfair and deceptive practices. The good news is that this isn’t a private lawsuit! I asked the Department of Transportation to investigate and enforce their rules against unfair and deceptive practices. The Department has rejected a similar objection in a complaint against British Airways. And in this case, DOT found an unfair and deceptive practice where Alitalia published passenger protections in its conditions of carriage while relying on conflicting terms in its tariff. American is doing the same thing here, relying on an unrestricted right to cancel under the general program terms which conflict with its CoC and tariff. DOT fined Alitalia for it. So I’m asking the Department to investigate – American chose to publish a deadline for canceling mistake fares, because it benefited them to do so. Passengers should be able to rely on it – including passengers who know they got a great deal. Topics on this page