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BEFORE THE DEPARTMENT OF TRANSPORTATION OFFICE OF AVIATION ENFORCEMENT AND PROCEEDINGS WASHINGTON, D.C.
------------------------------------------------------) ) Darren Martin, ) third-party complainant ) ) v. ) ) American Airlines, Inc. ) ) ------------------------------------------------------)
COMPLAINT OF DARREN MARTIN Comments with respect to this document should be addressed to: Darren Martin
Dated: March 1st, 2014
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Darren Martin Complaint
BEFORE THE DEPARTMENT OF TRANSPORTATION OFFICE OF AVIATION ENFORCEMENT AND PROCEEDINGS WASHINGTON, D.C.
---------------------------------------------------------------) ) Darren Martin, ) third-party complainant ) ) v. ) ) American Airlines, Inc. ) ) ---------------------------------------------------------------)
COMPLAINT OF DARREN MARTIN 1. This complaint arises out of American Airlines cancelling its early-
morning nonstop service BOS-ORD on which I had redeemed and ticketed two AAdvantage awards as part of a BOS-ORD-LHR itinerary. AA then refused to provide alternative comparable transport unless I paid additional fees (repeatedly mischaracterized as “tax”), in violation of AA’s prior commitments to passengers and to the Department of Transportation. I. My Ticket, AA’s Cancellation, and My Discussions with AA A. Ticket Issuance 2. On February 2, 2014, I used AA.COM to redeem miles for one-way coach
award travel BOS-ORD-LHR on 28 May. I chose the daytime departure to avoid unpleasant overnight flights. On net, the itinerary calls for departure from BOS at 6am and arrival to LHR at 10:45pm the same day. Travel was for my parents (two
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Darren Martin Complaint passengers), using miles from my AAdvantage account. I paid the $10 of taxes by credit card and received an itinerary and confirmation the same day. See Exhibit 1. B. Flight Cancellation and Initial Rebooking 3. On February 16, I received a schedule notification email indicating
rebooking on an alternate BOS-ORD flight on the afternoon of May 27, with a connection on the original daytime flight from ORD-LHR the following day. I called AA reservations to enquire about the change and was told the original BOS-ORD earlymorning flight had been cancelled and there was no alternative to get to ORD in time for the connecting flight to LHR leaving Boston the same day as the originally booked itinerary. I was also told I was responsible for my own accommodation for the proposed overnight stay in ORD. 4. I proceeded to ask about the direct flight BOS-LHR on BA. The agent
said there was award availability so this was possible, but there was an additional charge of approximately $250 per person to do so. I disagreed and asked whether this could be waived since AA had made a schedule change of more than nine hours. She checked, told me everything was updated in AA’s systems, and indicated that I should be able to check online later this afternoon for confirmation. I believe AA sent a confirmation email to my father at the email address associated with his AAdvantage account, but we no longer have access to this email account. 5. In the subsequent days, I used the AA.COM View Itinerary function to
check the reservation. I was able to see both passengers booked on BA flight 238 direct from BOS-LHR on May 28th in X class with taxes listed as $0. I believed the trip was fully corrected, so I deleted the original change emails.
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Darren Martin Complaint C. Second Attempt at Rebooking 6. On February 26, I received an email from AA asking me to call in. See
Exhibit 2. I called AA reservations and spoke with an agent who informed me that he saw on my reservation that I would have to pay approximately $250 per person to fly on the BA flights that were listed in my itinerary. I told him I didn't want to pay anything additional, and it seemed inappropriate that he was asking me to pay that since this all resulted from an AA schedule change. He said AA had to collect additional taxes because I was traveling on BA. I argued with him about calling it taxes as I assumed (I believe correctly) that the additional cost was actually a YQ charge (which is not a tax). He responded by saying that his computer says they are taxes and we need to collect them. After discussing different flight options, and having the agent talk to his help desk, we realized that (after AA’s schedule change) there is no way to do a same day trip from BOS-LHR without flying on a flight operated by BA. D. Discussions with a Reservations Supervisor 7. At this point I asked to speak to a supervisor. A lady came on the phone,
introduced herself as a supervisor, and then immediately gave an explanation of how AA has to collect additional taxes for award tickets on the BA flight. I immediately pointed out that I believed the charges aren’t taxes at all but rather fuel surcharges. She responded by saying that whatever I want to call them, AA still needs to collect them if I wanted to fly on that particular flight. I told her I thought I should be treated exactly the same way as a revenue passenger and that a revenue passenger wouldn't be charged more if the passenger had to be moved from an AA flight to a BA flight. She rejected my argument without providing any detail and instead offered to cancel my ticket and return the miles to my account. I declined that offer and pointed out that I had a contract with
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Darren Martin Complaint AA to get me from Boston to London on May 28, and the only remaining option that could accomplish that was the direct BA flight, due to AA’s decision to cancel my confirmed BOS-ORD flight. She laughed and said, I don't know where you are getting the word contract from but we certainly don't have that. She laid out my options (as she saw them) which she said were to take an overnight connecting flight through ORD (which I refused saying my parents were elderly and preferred not to fly overnight), pay the extra ~$500 in taxes (she again used that word, then corrected it to “fuel surcharges”), or cancel the trip and receive a refund of my miles. I told her that I didn’t know the full details of any reconciliation between AA and BA, but felt that in this circumstance AA should absorb any additional fees, to which she responded that she wasn’t able to do that. I suggested that I should instead speak to someone who was. She said she'd have someone call me back later that day. E. Discussions with the Duty Manager 8. That evening, I received a follow up call from a man who explained he
was the evening duty manager and he would try and help me with my issue. He explained that he understood that there were additional taxes which I didn't want to pay on the alternate BA flights my parents had been booked on. Again I immediately pointed out that the charges weren't taxes but surcharges. He then stated that, however I wanted to phrase it, AA is required to collect all additional taxes and carrier imposed surcharges for partners. He noted that AA reserved the right to make schedule changes and that different rules were in effect since this cancellation occurred well before travel. He also said the rules for award tickets and revenue tickets were different and that award travel can only be protected on AA metal, whereas AA is more prepared to deal with revenue protection on other airlines. If I wanted to stay on the BA flight, he said I would have to
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Darren Martin Complaint redeposit my miles (and taxes) and then book an award ticket on BA with the appropriate taxes and surcharges applied. 9. By this point I had found AA’s web site statements about cancellation
(discussed in paragraphs 17-19 below), so I asked the duty manager why this situation wasn’t covered by rule 240/80. He said those rules only dealt with revenue flights. (I later reviewed that page in greater detail, as discussed in paragraph 19, and noticed that in fact the page says it also covers AAdvantage flights.) 10. I asked the duty manager why AA issued a ticket on the BA flight for my
parents which I had been able to see on AA.COM until today. He said that reservations are reviewed by internal systems and it brought to their attention that there was an issue with the reservation and hence I had been asked to contact them to rectify the situation. 11. After back and forth about options, the duty manager repeated his position
that my only options were to pay the additional money to fly on the BA operated flight, refund the miles or take a different AA routing through either ORD or JFK. I enquired about the current status of my booking, I.E. which flights were actually held and confirmed. The duty manager indicated that my PNR was in limbo until we reached a satisfactory outcome. I indicated that I would discuss with my parents the options offered and call back at some point. At this time I do not know the current status of my booking. F. Discussions with a AA Representatives on Twitter 12. Later that evening I tried posting to AA’s representative on Twitter. Our
exchange was as follows: Dazza02129: So AA canceled my award flight, replaced it with BA flight but now wont let me fly without paying increased "taxes" - help
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Darren Martin Complaint AmericanAir: “Darren, if your flight was canceled due to a schedule change, you're able to refund your ticket.” Dazza02129: “It was, but I still have to get my parents home - and the only oneworld option same day as original itin is AA*/BA.” AmericanAir: “Our apologies, Darren, we're unable to waive the taxes. Perhaps check alternate travel dates?” Dazza02129: “Aren't the additional BA fees a surcharge, not a tax? And rule 80 doesn't say anything regarding additional charges!” AmericanAir: “Darren, we're unable to waive other carrier taxes or charges. Our apologies for your disappointment.” II. AA is Obliged to Provide Transportation on BA without Additional Charge A. AA General Tariff 13. I believe the situation at issue may be appropriately considered as a
change in schedule. AA’s International General Tariff provides as follows: When a passenger will be delayed because of a change in its schedule, carrier will arrange to: transport the passenger over its own lines to the destination, next stopover point or transfer point shown on its portion of the ticket, without stopover at no additional cost to the passenger, provided that a passenger who paid an Economy Class fare will be transported on one of its First Class flights only if such flight will provide an earlier arrival than its next Economy Class flight on which space is available. endorse the unused ticket for the purpose of rerouting over another carrier; or refund in accordance with Rule 90 (REFUNDS). 14. I believe the three listed options are intended to be alternatives, separated
by “or.” (I note that the first option does not end in the word “or”, and the second option is not a complete sentence. I take this to be a drafting error.) 15. The section is ambiguous as to who gets to choose among the three
options. Following the standard principle of contract law that an ambiguous contract is construed in favor of the party that did not draft it, I interpret the section to allow the passenger to make that choice. (That interpretation also matches the options enumerated in AA’s Schedule Change page, discussed in paragraph 17 and onwards below.)
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Darren Martin Complaint 16. I choose the second of these options. Specifically, I choose to be endorsed
to the nonstop BA operated service BOS-LHR. Note that the second option makes no mention of any obligation to pay any difference in fare, tax, or surcharge. B. AA “Schedule Change” Web Page and Rule 240/80 17. I also reviewed AA’s Schedule Change page which, according to AA,
gives the “Rule 240/80” rules for schedule irregularities. At heading AA Schedule Change, the page provides as follows: [schedule change of] 91 minutes and greater Or the flight changes from a non-stop to a connecting flight If original inventory is not available may book an AA flight next lowest available inventory, same cabin, up to and including B inventory. If no AA flights are available may select an alternate flight on AA* (AA codeshare) maintaining same inventory, origin/destination, fare and fare basis as originally ticketed. Restricted to oneworld® codeshare partners: If no AA flights are available may select an alternate flight on a oneworld AA*, if original inventory is not available may book next lowest available inventory, same cabin, up to and including B inventory, excludes W inventory for premium economy on AA*. 18. The proposed schedule change is a change of more than 11 hours, which
of course is far more than the 90 minutes that triggers the quoted provisions. I am therefore entitled to the benefits of this section. I elected to use either the second or third option. I note that when the February 16 agent booked me onto the BOS-LHR flight (and subsequently on Feb 26th), there was award inventory on that flight, which I take to satisfy the second-listed option (“maintaining same inventory”). Furthermore, even if that inventory was not available, the third-listed option provides that I could be booked into a higher available inventory since 1) no AA flights are available within a reasonable period of time, and 2) BA is a Oneworld codeshare partner.
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Darren Martin Complaint 19. As discussed in paragraph 7, an AA duty manager indicated to me that
Aadvantage tickets are not protected by rule 240/80 or AA’s web site statements about reaccommodation. I note that AA’s Schedule Change page indicates exactly the contrary. Specifically, the top of the page indicates that “Rule 240 protects all ticketed customers including AAdvantage, AA codeshare and Travel Agents free/reduced rate” and “Rule 80 protects all ticketed customers including AAdvantage, AA codeshare and Travel Agents free/reduced rate.” C. AA Commitments to DOT in Its Request for Antitrust Immunity with BA and Others 20. AA’s request for additional fees, when reaccommodating me after AA’s
cancellation, is inconsistent with the representations and commitments AA and BA made to DOT when seeking antitrust immunity. See their Joint Application for Antitrust Immunity, docket DOT-2008-0252, which lists as the supposed sixth benefit of the JBA: “The Joint Applicants will offer reciprocal frequent flyer programs to allow members of one carrier’s frequent flyer program to accrue mileage and redeem awards on the services of another” (p.15, emphasis added) including “full reciprocity of frequent flyer benefits between American and British Airways” (p.16, emphasis added) and indeed “metal neutrality” (p.22). Here, even in response to a cancellation of ticketed and confirmed travel, AA is not treating BA flights in a “reciprocal” or “neutral” manner (not to mention “full reciprocity”)—although AA had specifically promised all of these benefits. 21. AA and BA sought a significant concession from DOT in waiving
antitrust laws as to their joint operation. For years, DOT was appropriately hesitant, noting the significant risks to pricing and service. AA and BA made forceful
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Darren Martin Complaint commitments in order to attempt to address DOT’s concerns and other concerns. AA and BA must now uphold the plain and literal meaning of their commitments. III. AA Continues to Mischaracterize Carrier-Imposed Fees as “Taxes” 22. Each and every AA representative I have spoken with on and after
February 26 has used the term “taxes” to describe the fees at issue. During my discussions with AA agents, I spoke by telephone with three AA agents, and I communicated by Twitter with a fourth. See the discussions summarized in section I above. Each of the agents used the word “taxes” to describe the charges at issue. Each used that term until I corrected them. I provide my summaries of the discussions from memory, and I do not have call recordings. But in this respect I am quite certain: I knew the difference before the discussion began, and I am confident that I corrected all four agents. As to the AA staff using Twitter, the false statement (and my correction of that false statement) are well preserved in the written record. 23. I note that these practices are ongoing and recent. My experiences
occurred during February 2014. I received mischaracterizations from both a reservations supervisor and a person who described himself as a duty manager. A. My Experiences Matches Others’ Reports 24. I have reviewed the complaints of Benjamin Edelman as to American
employees mischaracterizing carrier-imposed surcharges as “tax.” My experience is similar. I note that Mr. Edelman’s initial complaint flagged the problem of reaccomodation after cancellation as one of the circumstances in which AA staff mischaracterize carrier-imposed surcharges as tax. Reviewing subsequent briefing, I see that AA argued Mr. Edelman did not have standing to bring such a complaint because he did not personally suffer such a cancellation. I do. 10 of 19
Darren Martin Complaint 25. I reviewed the formal comment of Shawn Cole, who describes an AA
agent who was hostile to him (indeed, disconnected his call) after Mr. Cole noted that a carrier-imposed surcharge is not a “tax.” My experience is similar. I was not disconnected when I brought this error to each and every agents’ attention. But agents repeatedly acted belligerently towards me after my comment, including making disparaging remarks along the lines of “whatever you want to call them.” The agents did not seem to recognize the important difference between an amount retained by a carrier versus an amount paid to a government, airport, or similar authority. B. DOT’s Prior Ruling on Similar AA Practices 26. In its Consent Order of December 11, 2013, DOT affirmed that AA has
misrepresented carrier-imposed surcharges as “tax,” and that doing so is unfair and deceptive. DOT ordered AA to cease these practices, and AA confirmed having done so. Inexplicably, and contrary to its representation in the Consent Order, AA continues similar practices to this day. C. AA’s Special Duties In Light of Its JBA with BA 27. AA used the word “taxes” and otherwise indicated that it “must” and
“has” to collect the taxes. These claims are particularly puzzling in light of American’s special relationship with British Airways. Just six years ago, American and British Airways sought and received DOT permission to coordinate pricing for their joint services. See Joint Application for Antitrust Immunity, DOT-OST-2008-0252-0001 at p.14 (“The Joint Applicants will cooperate in establishing fares, rates and pricing strategies for services provided under their alliance agreements and the JBA”). American and British Airways also indicated that they would “broadly shar[e] revenue on a metal neutral foundation” (Id. at p.11). There can be no serious dispute that carrier-imposed
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Darren Martin Complaint surcharges and fuel surcharges are “revenue” and “fares, rates and pricing” within the meaning of these statements. Thanks to the full antitrust immunity DOT provided to American and British Airways based on their representations in the 2008-0252 docket, American both influences and benefits from British Airways surcharges. Having sought these privileges from DOT and represented to DOT that it would use them, AA cannot now disavow them by claiming that all fees are the responsibility of BA or otherwise outside AA’s control. IV. The Scope of the Problem 28. I gather that AA staff are uniformly applying their demand for additional
payments (“taxes”) when award passengers are reaccommodated after cancellation of ticketed and confirmed AA flights. On the popular discussion forum FlyerTalk, I quickly found another passenger (username “robbiesam”) with the same problem. He was ticketed on an AA day flight JFK-LHR which AA cancelled. He sought reaccommodation on the BA day flight JFK-LHR. Instead AA insisted that he fly JFKRDU-LHR or pay additional fees to fly on BA. Robbiesam also indicated that AA staff mischaracterized surcharges as taxes (“they repeated that the taxes had to be paid”). 29. I understand that AA canceled the JFK-LHR day flight for most of 2014.
AA’s JFK-LHR previously had 777-200ER service, accommodating 247 passengers per flight. If 8.8% passengers on these flights were on award tickets (based on a recent AA SEC filing), that would be 650 affected passengers per month in each direction. Even crediting that not all passengers book far in advance, there are surely thousands of passengers affected by that cancellation. The closest alternative eastbound flight is the BA day flight. But by all indications AA is refusing to reaccommodate passengers on
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Darren Martin Complaint that flight. AA’s refusal to reaccommodate affected JFK-LHR passengers is particularly troubling because AA admitted cancelling its JFK-LHR day flight purely for commercial reasons (“so we can consistently offer a fully lie-flat product”). This is far from the passenger benefits AA promised when seeking JBA approval from DOT. After joining the JBA, AA likewise cancelled all of its nonstop BOS-LHR flights, instead preferring to advise passengers to fly on an AA-marketed BA-operated equivalent, which both reduces choice and causes additional cost for passengers attempting to redeem miles to travel this route. 30. The amount at issue is substantial. AA staff told me that I would need to
pay a surcharge of approximately $250 per person one-way to fly BOS-LHR on the flight operated by BA. On the same period, on the same routing, I see that round-trip tickets including all taxes and fees are as little as $1300. So a $500 round-trip surcharge is more than one third of the value that passengers expect to be covered by award point redemption.
I ask that the Department of Transportation: (1) Exercise its authority under 49 USC 41712 to open an investigation of American Airlines for having engaged in, and continuing to engage in, the unfair or deceptive practices described above; (2) Order American Airlines to provide to the DOT and to me all notes, PNR annotations, call recordings, and other records prepared by its systems and its staff in the course of the discussions herein;
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Darren Martin Complaint (3) Pursuant to such investigation, order American Airlines to refund to ticket purchasers all monies represented to ticket purchasers as “taxes” or government-imposed fees, but not actually remitted to governments; (4) Order American Airlines to honor its general tariff, published policies for reaccommodation after cancellation and significant schedule changes, without exception for award ticket redemptions and without requiring any additional payment of any carrier-imposed surcharges; (5) Order American Airlines to provide heightened and remedial training to all agents, including specific corrective training to the agents who spoke with me; (6) Require American Airlines to post a clear notice on its web site to alert award passengers of their rights in this circumstance and to assist such passengers in vindicating those rights even if American employees mistakenly attempt to deny those rights; (7) Require American to search its records for other customers similarly situated, including those who complained about related matters and those who suffered similar schedule changes and cancellations, and require American to provide the details of such customers and complaints to DOT; (8) Impose appropriate civil penalties on American Airlines; and (9) Refer this matter to appropriate US and foreign tax collection agencies for investigation of possible tax fraud or other violations of tax law in
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Darren Martin Complaint non-payment to governments of monies collected as “taxes” or government-imposed fees.
I suggest that when DOT imposes monetary penalties for this further violation, DOT should consider the fact that the 2013-12-6 Consent Order specifically requires that AA permanently cease and desist from precisely these practices. A heightened penalty is appropriate in light of American’s sophistication and size, the duration of the practices at issue, the continuation of these practices after consumer complaints, the continuation of these practices after DOT inquiry, the continuation of these practice after AA had specifically promised DOT that these practices had ceased (and had entered into a formal binding consent order to that effect), and the continuation of these practices even by AA supervisors and duty managers.
Respectfully submitted, /s/ Darren Martin
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Darren Martin Complaint Attachment 1
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Darren Martin Complaint
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Darren Martin Complaint Attachment 2
FROM: Sro, Qrd Feb 26 at 1:18 PM Please contact American Airlines at 1-800-882-8880, regarding your upcoming reservation. When you call, please refer to Record Locator:
Thank you, American Airlines *** THIS IS AN INFORMATION ONLY EMAIL *** *** PLEASE DO NOT REPSOND TO THIS EMAIL *** *** EMAIL NOT MONITORED FOR RESPONSES ***
NOTICE: This email and any attachments are for the exclusive and confidential use of the intended recipient(s). If you are not an intended recipient, please do not read, distribute, or take action in reliance upon this message. If you have received this in error, please notify me immediately by return email and promptly delete this message and its attachments from your computer.
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Darren Martin Complaint
Certificate of Service
I hereby certify that I have, this 1st day of March, 2014 caused a copy of the foregoing Complaint to be served by electronic mail on the following persons: Robert Silverberg, Esq. Robert Gorman, Esq. email@example.com firstname.lastname@example.org
/s/ _____________________ Darren Martin
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