• Home
  • Reviews
    • Flight Reviews
    • Hotel Reviews
    • Lounge Reviews
    • Trip Reports
  • About
    • Press
  • Contact
  • Privacy
  • Award Expert
  • Advertising Disclosure
Live and Let's Fly
  • Home
  • Reviews
    • Flight Reviews
    • Hotel Reviews
    • Lounge Reviews
    • Trip Reports
  • About
    • Press
  • Contact
  • Privacy
  • Award Expert
  • Advertising Disclosure
Home  >  Mistake Fares  >  DOT Suspends Consumer Protection for Purchased Airline Mistake Fares but Opens New Loophole
Mistake Fares

DOT Suspends Consumer Protection for Purchased Airline Mistake Fares but Opens New Loophole

Matthew Klint Posted onMay 12, 2015December 5, 2016 2 Comments

united-dkk-mistake-fare

As expected, the U.S. Department of Transportation has rolled back its explicit mandate that airlines honor mistake fares but in doing so has opened up a new loophole that may give carriers an even bigger headache when they inevitably file mistake fares in the future.

Gone is the unequivocal language stating that post-purchase price increases are not even permitted for mistake fares. In a way. The language is still there, but DOT has said that it will not enforce the rule as it ponders a new way to protect consumers from post-purchase price increases while simultaneously not allowing “bad faith” consumers to take advantage of “mistaken fares”.

As a matter of prosecutorial discretion, the Enforcement Office will not enforce the requirement of section 399.88 with regard to mistaken fares occurring on or after the date of this notice so long as the airline or seller of air transportation: (1) demonstrates that the fare was a mistaken fare ; and (2) reimburses all consumers who purchased a mistaken fare ticket for any reasonable, actual, and verifiable out-of-pocket expenses that were made in reliance upon the ticket purchase, in addition to refunding the purchase price of the ticket. These expenses include, but are not limited to, non-refundable hotel reservations, destination tour packages or activities, cancellation fees for non-refundable connecting air travel and visa or other international travel fees. The airline may ask the consumer requesting out-of-pocket expenses to provide evidence (i.e. receipts or proof of cancellations) of actual costs incurred by the consumer. In essence, the airline or seller of air transportation is required to make the consumer “whole” by restoring the consumer to the position he or she was in prior to the purchase of the mistaken fare. The enforcement policy outlined in this notice is temporary and will remain in effect only until the Department issues a final rule that specifically addresses mistaken fares.

We must note that even as the DOT considers alternate ways of adjudicating mistake fare controversy, it may still find that §399.88 is best left unaltered. 

If, based on comments received in the rulemaking process, the Department determines that section 399.88 should remain as written, airlines and other sellers of air transportation would be expected to comply and the Enforcement Office would enforce the requirement. 

Read the full text here.

Gary and I share similar concerns over the glaring problems of this interim framework.

The object of this shift in enforcement is to crack down on “bad faith” actions, but it actually encourages more bad faith action. In forcing airlines to make consumers whole (using a detrimental reliance legal theory) by compensating non-refundable purchases made in reliance on mistaken fares, the DOT has just incentivized bad faith purchases.

Think of the possibilities: we see a mistake fare that is far too good to be true and we book it, knowing that a carrier is unlikely to honor it. Knowing that the airline will be forced to “make us whole” we get to work booking the rest of the trip. Positioning flights? Check. Five nights under a non-refundable rate at a nearby resort? Check. Pre-paid rental car? Check.

Per DOT, airlines would be on the hook to compensate us for these voluntary expenses if the carrier chooses not to honor the fare. Even if we make the nonrefundable purchases in conjunction with the mistake fare moments after booking and knowing full well United would not offer transatlantic first class for $96 r/t, it does not matter – we would be owed a cash refund from the airlines. And then what is to stop us from using those non-refundable hotel rooms and car rentals anyway?

Of course this will become a game of chicken. And if waiting for a refund becomes anything like dealing with Flying Blue (the woefully lackadaisical loyalty program of Air France/KLM ), it may not be worth the gamble for consumers. I suspect this stipulation will actually make carriers more likely to honor fares than not.

Airlines are not given a deadline for rescinding mistake fares. Under my theoretical framework, airlines and consumers would both have a 24-hour cooling off period as long as travel was more than seven days away. Under the current framework now in place, airlines can let months pass before canceling a ticket on the ground it was issued by mistake. This has grave ramifications when coupled with the next concern.

Consumers (and airlines) have no clear indication of what is a mistake fare. A $96 first class fare may be too good to be true, but what about a $550 trip to India? The DOT says this:

The burden rests with the airline or seller of air transportation to prove to the Enforcement Office that an advertised fare and the resulting ticket sales constitutes a mistaken fare situation.

Brilliant Holmes. That sure makes it clear. We now return to an era of uncertainty, in which we never know whether a fare is a mistake or a sale. Without any sort of mathematical metric or formula for determining a mistake fare (say a fare is a mistake if it is several deviations off the historic norm…though any such method is fraught with problems too), clever airline legal counsels may be able to argue out of a fare their carrier simply regretted filling rather than mistakenly filed.

In Summary

Do not be dismayed – the suspension of enforcing rule §399.88 is not good news, but the new rules forcing airlines to make consumers whole (whether they acted in bad faith or not) will at least give airlines pause before rescinding the inevitable mistake fares of the future.

Previous Article Fighting Cancer with Delta Jet Drag
Next Article FOIA Request from U.S. DOT Arrives over United Danish Kroner Mistake Fare

About Author

Matthew Klint

Matthew is an avid traveler who calls Los Angeles home. Each year he travels more than 200,000 miles by air and has visited more than 135 countries. Working both in the aviation industry and as a travel consultant, Matthew has been featured in major media outlets around the world and uses his Live and Let's Fly blog to share the latest news in the airline industry, commentary on frequent flyer programs, and detailed reports of his worldwide travel.

Related Posts

  • Delta Korean Air First Class Mistake Fare

    Delta Considers $2,700 A Mistake Fare…

    June 18, 2022
  • mistake fares

    Jail Time for Publishing a Mistake Fare?

    May 4, 2018
  • Air France First Class Refund Letter

    Air France Writes Me, Issues Refund

    January 16, 2018

2 Comments

  1. Bill Reply
    May 12, 2015 at 8:24 pm

    Where can we write to the DOT that both the airline and consumer should have the same 24 hour period to cancel the fare. I don’t want to be notified late in the game and possibly on the way do the airport that the fare is canceled. also, there should be a reasonable amount of time that the airline should be required to refund all expenses that they are responsible to refund.

  2. MeanMeosh Reply
    May 12, 2015 at 8:38 pm

    The potential for chicanery on the part of passengers is easy enough to eliminate – the airline can simply demand proof of cancellation of any nonrefundable arrangements, as the DOT’s own language suggests they have the right to do. I’d say anyone that intentionally books expensive nonrefundable hotels, tours, etc. with the intention of demanding a cash refund but using the hotel our tour anyway is playing with fire, and stands a good chance of getting burned badly.

Leave a Reply

Cancel reply

Search

Recent Posts

  • Review: Kempinski Hotel Ishtar Dead Sea January 28, 2023
  • American - Delta JFK Incident Pilot Analysis
    A Veteran Commercial Airline Pilot Analyzes American – Delta Runway Incident At JFK January 28, 2023
  • Pre-Boarding With Children: How Old Until They Are Too Old? January 27, 2023
  • Dog Business Class Turkish Airlines
    Dachshund Flies Business Class To Paris…In Her Own Seat January 27, 2023

Categories

Popular Posts

  • Casting Couch? Kuwait Airways Forces Prospective Flight Attendants To Undress For “Research Purposes” January 4, 2023
  • Spirit Airlines Captain Runs Out Of Cockpit After Woman Yells “I Hope Y’All Crash And Die!” January 17, 2023
  • SWISS First Class Awards Bookable With United Airlines MileagePlus January 5, 2023
  • United Airlines 2023 Status Extension
    United Airlines Quietly Extends MileagePlus Premier Status…Again January 14, 2023

Archives

January 2023
M T W T F S S
 1
2345678
9101112131415
16171819202122
23242526272829
3031  
« Dec    

As seen on:

live_and_lets_fly

The new United Polaris Lounge at Washington Dulles The new United Polaris Lounge at Washington Dulles is the most beautiful of all Polaris Lounges. Stay tuned for a detailed look and many more photos on the blog tomorrow. Well done @united.
@malaysiaairlines just announced it would retire i @malaysiaairlines just announced it would retire its A380 fleet. While not surprising, it is sad to see the growing list of carriers retiring this superjumbo jet. On Malaysia Airlines, I flew the #A380 once from Kuala Lumpur (KUL) to London (LHR) and had the entire first class cabin to myself (full review on the blog). It was a beautiful flight that I will always remember.
Welcome to @fly_bur @aveloair! I am so excited tha Welcome to @fly_bur @aveloair! I am so excited that a new carrier, Avelo, has launched, especially from an airport just 12 minutes from my home!
I greatly miss the @lufthansa #747-8 at @flylaxair I greatly miss the @lufthansa #747-8 at @flylaxairport. Hopefully this summer it will return.

.
.
.
.
#Lufthansa #FirstClass #747 #747-8 #StarAlliance #Miles #Points
I recently spent a weekend at the @ventanabigsur. I recently spent a weekend at the @ventanabigsur. This is not only a lovely, all-inclusive resort, but one of the best properties to use your @hyatt World of Hyatt points.
.
.
.
.
#Hyatt #BigSur #California #WorldofHyatt #CA-1 #Points #Hotels
In terms of a spacious first class product, the @E In terms of a spacious first class product, the @Emirates suite on a 777-300ER is hard to beat. My preference is Suite 2K.

.
.
.
.
#Emirates #777 #firstclass
Nearly five years ago, I took a “break” from I Nearly five years ago, I took a “break” from Instagram ahead of the birth of my first child. Goodness, how time flies. While I’ve enjoyed catching up on others over the years, now it is time for me to return to Instagram. In this first post, I highlight two joys in my life, my two children, whom I trust will grow up to be prolific travelers that circumnavigate the globe as ambassadors of love and respect.

.
.
.
.
.

#travel #airplanes #airlines #miles #points #familytravel #human #integrity #honor
United Airlines' new Polaris seat is a huge improv United Airlines' new Polaris seat is a huge improvement over UA's current business class seat. Check out my blog at liveandletsfly.com for 70+ photos of how @united is transforming its entire business class experience starting this December!
The perfect @flysas name tag for #Longyearben! The perfect @flysas name tag for #Longyearben!
Spotted four #polarbear outside of #longyearbyen - Spotted four #polarbear outside of #longyearbyen -- oh, and I love 40°F summer weather!
One of the best crews I have ever had the pleasure One of the best crews I have ever had the pleasure of flying with in all my years of flying. Thank you @flysas SK940 on 11 Aug 2016
Next stop ARN! But dear @flysas , next time if I a Next stop ARN! But dear @flysas , next time if I assign a window seat months in advance, don't move me to a center seat "for my convenience" with no way to get my original seat back... 😞
Ready for #PIA from #MAN to #JFK -- we will be rac Ready for #PIA from #MAN to #JFK -- we will be racing the #Delta flight to JFK at the gate next to us, which also departs at 12:45p. With @onemileatatime
Another room with a beautiful view... #hyattregenc Another room with a beautiful view... #hyattregencycasablanca #cassablanca #hyatt
Enjoying #shanghai with @onemileatatime from the i Enjoying #shanghai with @onemileatatime from the inside of the @grandhyatt_shanghai ... It is 40°C outside! 😓
From my front gate to my boarding gate in 15 minut From my front gate to my boarding gate in 15 minutes flat. I ❤️ #bur #burbankairport
@malaysiaairlines #747 out of retirement and in se @malaysiaairlines #747 out of retirement and in service at #kul -- beautiful livery!
View from my 61st floor room at the beautiful bran View from my 61st floor room at the beautiful brand new @parkhyattguangzhou -- look for a full review coming soon on the blog #hyatt #parkhyatt #guangzhou #parkhyattguangzhou
Will miss the @united #globalfirstlounge at #ord, Will miss the @united #globalfirstlounge at #ord, which closes tomorrow and the Queen of the Skies #747 which will be retired in 2018.
The colonial #architecture of #mumbai is stunning. The colonial #architecture of #mumbai is stunning. If you're ever here, get up at 5am and have a walk around the city before it gets busy. You can hear the birds instead of honking horns.
Load More... Follow on Instagram
facebook twitter instagram rss

This site is for entertainment purposes only. The owner of this site is not an investment advisor, financial planner, nor legal or tax professional and articles here are of an opinion and general nature and should not be relied upon for individual circumstances.

 

Advertiser Disclosure: Some links to credit cards and other products on this website will earn an affiliate commission. Outside of banner ads published through the Boarding Area network, this compensation does not impact how and where products appear on this site. While we do try to list all the best miles and points deals, the site does not include all card companies or credit card offers available in the marketplace. Please view our advertising policy page for additional details about our partners.

 

Editorial Disclosure: The editorial content on this page is not provided by any entity mentioned herein. Opinions expressed here are the author's alone, and have not been reviewed, approved or otherwise endorsed by any of these entities.