United Airlines claims it is “forever” getting rid of change fees on most tickets within the USA. It further emphasizes that this move is “permanent”. But do such promises hold any legal sway? To look forward, we must look back.
No Fees Forever? United Airlines Has Broken Promises In The Past…
Travel back with me to 2012. United had promised its MillionMiler members (those who travelled at least 1,000,000 miles on United) two systemwide upgrades upon qualification and two confirmed regional upgrades per year as part of their lifetime benefits package. Many stayed loyal to United on the basis of that promise. But one day United decided to remove those benefits without notice (in fairness, it added others like spousal benefits). A group of flyers sued, arguing such action constituted an “immediate and significant retroactive demotion of benefits to Million Milers.”
Indeed, United had promised just months ago that MillionMiler benefits were safe:
The case went to trial. In fact, it went all the way up the Seventh Circuit Court of Appeals. United argued that the terms of it MileagePlus program superseded any promises to MillionMilers, which did not have a separate contract.
It boiled down to whether United’s promise to potential MillionMilers to entice more business was superseded by the carte blanche clause in the MileagePlus contract that United could make changes to its program at anytime without notice.
United won. But the case produced this memorable exchange between Judge David Hamilton, Judge Diane Wood, and counsel for United:
Judge Hamilton: You expect people to rely on this promise.
United: We expect people who enroll in the MP program to read the rules, to understand what those rules are and those rules govern govern benefits.
Judge Hamilton: To understand the difference between lifetime and fingers crossed? That lifetime doesn’t mean lifetime?
United: That lifetime means lifetime unless…
Judge Wood: Unless we change our mind.
Judge Hamilton: Unless we change our mind.
United: Yes, that’s exactly right. That’s the case.
Nice.
Every Case Is Different
The matter before us is different, however. While the MillionMiler case fell under the MileagePlus program (and the terms and conditions that accompanied it), this is a general but concrete offer to all perspective buyers. I see no language in United’s general contract of carriage that allows its to unilaterally raise fees. Of course there is no language prohibiting it, either. Thus, we are left with general terms of contract law.
On its page announcing the news, United proclaims in bold:
“We’re permanently getting rid of change fees for most Economy and premium cabin tickets for flights within the U.S.”
United CEO Scott Kirby promises this in his video.
On Instagram, United added:
Go back to the MillionMiler case for a moment. Plaintiffs did not prevail because United argued they should have read the MileagePlus rules.
Judge Hamilton: Let’s talk about that. How does United expect people to respond to that news: We’re offering this lifetime benefit if you reach a million miles. Why isn’t that obviously a unilateral contract offer that can be accepted by performance?
United: Because, again, it is all subject to the MileagePlus rules.
Is there a difference?
Offer? Consideration? Acceptance?
Ok. Another break. Let’s pivot to Leonard v. PepsiCo, which was one of the most enjoyable cases I read in law school.
On the basis of the commercial below, a group of kids got together to assemble 7,000,000 Pepsi Points in order to redeem them for a Harrier Jet.
Plaintiffs used program language stating Pepsi would sell points for $0.10/each to send Pepsi a certified check for $700,000 to secure the points needed and thus, the Harrier Jet.
But Pepsi brushed them off and said no deal. They sued and Pepsi prevailed.
The judge held that the advertisement was not a binding offer and no reasonable person would have seriously meant to exchange a jet worth roughly $23 million for $700,000 (this sort of advertisement is called “puffery”).
No Fees Forever On United Airlines?
Is United’s offer mere “puffery” here? Of course not. But is its promise of “forever” mere puffery? I don’t know about you, but it is in my mind. No one trusts the airlines (and I do use the term generally) to do anything except that which benefits its bottom line. Ultimately, if United deems that change fees and standby fees are worth charging, it will.
Could United be sued for violating its implied covenant of good faith and fair dealing if it later reneges this offer? Nope, at least for tickets which have not yet been booked. See Northwest v. Ginsberg, where a unanimous Supreme Court held that such a claim was preempted under the Airline Deregulation Act (“ADA”) of 1978. In short, you’d base such a claim on state law and the ADA does not allow for a lawsuit on that basis if it seeks to enlarge the contractual obligations that the parties voluntarily adopt.
CONCLUSION
United won’t be able to change the terms of your contract after you’ve contracted. In other words, if you book a ticket United cannot later decide to charge a change fee on that ticket (and get away with it). But in the long run, this “forever” language means very little. United can renege it for new tickets at anytime. Whether it will, however, is another matter…and I don’t expect it for at least 2-3 years.
Remember, United is the airline that re-defined the word cancellation earlier this year. My advice is to enjoy this wonderful new customer benefit…while it lasts. Hopefully it will for years.
UA will eventually add a new fee, but it wont be a CHANGE fee…it will be called something else, with some SLIGHT twist. Happens all the time. No activation fee on phones, but did we mention that the SIM now costs $35? 😛
With “Plus” in the name no doubt! 😉
Basic Plus…all the money saving features currently available with the lowest 2-4 booking class codes of regular economy, branded as a slightly better version of Basic Economy (FF credit, advance seats, even a carry-on!).
“Regular economy” fares that start at current W or V class pricing levels will still have all the benefits you’re used to, plus “free changes forever”!
You just gave United a very good idea.
Ha! AA spent the last day thinking about it and seems to have come up with something pretty similar…new basic economy features (“nominal” charges apply).
I fear that there will be a meaningful floor on regular fares (that will rise as the economy recovers). Shareholders will demand their returns or they will punish the carriers for giving up this income stream…
I would trust a king cobra before I trust United.
I expect the gap in fares between economy and basic economy to increase.
I totally agreed with reader joelfreak’s comment above. It is funny to see how many naive people jump up and down with this “forever” news. Remember last November United announced the rules to earn 6 and 5 PQP’s depending on preferred and non-preferred partners. I recalled many applauded and gave examples such as just fly 6 trips with SQ from Newark to Singapore and one would be 1K… just a short time after, United announced the maximum PQP’s earned with partners on each flight would be 1000 or 500 for business and economy, respectively. In English, “Forever” means forever. However, we are speaking United language here.
Delta and AA have similar or better matches announced.
@T : yea who can forget Delta’s moral high horse by sending alliance partner KE down to Group 4 earning rates at one time and use that was a way to pressure KE to bend to its will ?
with friends like these, who needs china
I assumed United had also furloughed all it’s penny per word “micro-influencers”…apparently not since you are coming to UA’s defense on every single travel blog
Slimy marketing hucksters have turned “enhancement” into a euphemism; redefined it completely. No one believes them; they’re on a par with the ‘wait..there’s more’ lowlifes on shopping channels.
Do they have those in Australia too?
This is probably a push to get more people to buy regular economy vs basic economy. These guys must have done the maths and figured that its more cost effective / possiblee to generate more revenue through this.
There is also the possibility that airlines know they are up the creek right now, so are trying their best to get more butts in seats. In 3 – 4 years, when the economy enters a recovery phase, you can expect these benefits to be slashed.