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Supreme Court: Airlines Are Immune From Mileage Lawsuits

Update: Looking through the actual decision now and indeed it does say,

Although respondent and amici claim there have been fundamental changes in the way that frequent flyer miles are earned since Wolens was decided, that does not matter here where respondent did not assert that he earned miles from any activity but taking flights or that he attempted to redeem miles for anything but tickets and upgrades.

So it sounds like the Supreme court would accept another case against the airlines where the miles in question were earned from non-flight activity or would be used for non-flight redemptions.
And that’s a very good thing.
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Via the Chicago Tribune, the Supreme Court has rules in favor of Delta and tossed out Rabbi Ginsberg’s lawsuit against them for closing his mileage account for complaining too much.

In short, the deregulation act places the airlines above the courts jurisdiction and they can do anything they want.

It’s a shame that this is the case that went to court. It would have been far more interesting to see a case go to court where an account was closed where all of the miles were earned from credit card spend instead of miles. After all, the deregulation act may have given airlines full power over price, route or service, but does it really give them control over something that was not earned via flying and can be redeemed for things other than flights?

I’m no legal expert, but I’m not sure just how strong this precedent is. The airlines may have won this one, but I don’t think we’ve seen the end of mileage suits in court.

HT: sb5917, via DDF

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33 Responses to “Supreme Court: Airlines Are Immune From Mileage Lawsuits”

  1. vusstitzich Says:
    1

    SAD

    ReplyReply
  2. Yitz Says:
    2

    Very interesting. Are there current pending cases with people who have earned mileage via “other means”?

    ReplyReply
  3. zvi Says:
    3

    Here’s an issue for ya’: do airlines have the right to segregate flyers with babies to a special section of the plane to minimize annoyance to the other passengers ?

    ReplyReply
  4. sb Says:
    4

    ht?

    ReplyReply
  5. Flyer Says:
    5

    It’s a sad day for flyers. They closed his account and lost hundreds of thousand miles for no reason other then he sometimes rightly complained about their bad service! They can now do whatever they sent with you!

    ReplyReply
  6. itamar Says:
    6

    It seems to me that this case had no precedent for a credit card points program. Those would likely be under a completely different set of rules, I.e. Credit Cards.

    ReplyReply
  7. yitz Says:
    7

    can we be filled in… what was the lawsuit about?

    ReplyReply
  8. spoketoborders Says:
    8

    I think this may cause consumers to think twice before complaining about every little thing looking for compensation.

    ReplyReply
  9. chase bank Says:
    9

    Someone should take Chase to court for closing accounts the day before the statment is issued and clears out all miles owed even those that were earned in months prior.

    ReplyReply
  10. Dan Says:
    10

    @itamar:
    Hopefully someone will take up just that challenge.

    @yitz:
    Rabbi Ginsberg flew a ton and complained a couple dozen times for compensation.
    They got tired of the complaining so they took away his miles and elite status.
    SCOTUS ruled that the airline is allowed to do that.

    @chase bank:
    Did you login to your account recently? Most people have been made whole within the past few weeks.

    ReplyReply
  11. Sl Says:
    11

    Btw, look at your chase accounts now. All chase points earned are back in. Probably someone did file a lawsuit about it

    ReplyReply
  12. Adam Says:
    12

    @Flyer:

    I don’t have all the details about the issue, but it seems that Rabbi Ginsberg was abusing the program. He complained TWENTY FOUR times, and was compensated almost 2k in travel vouchers for his complaints, and an additional $491 for cash reimbursements! If I believe that a service is bad and complain more than a few times about an issue, I would stop using that service all together! but the fact that he kept complaining (24 TIMES!)AND KEPT USING THE AIRLINE indicates to me that he indeed trying to get additional perks. In the end I think the airline should have let him keep his miles, but tried to end their business with him.

    ReplyReply
  13. Dan Says:
    13

    @Adam:
    A fairer solution would be to ban him from future reimbursements and/or cancel reimbursements paid out.

    But why steal his earned miles and lose his future business? Seems petty and foolish, but hey, we’re talking about the airlines here.

    ReplyReply
  14. mike Says:
    14

    Of note that those 24 complaints were within a 7 month period. Thats alot no matter how much you fly.

    ReplyReply
  15. Dan Says:
    15

    @mike:
    I don’t disagree.

    ReplyReply
  16. bingo Says:
    16

    can you elaborate about the recent chase reinstatement
    i have a few chase accounts that have been closed dow in the past (diff family members )

    ReplyReply
  17. Sl Says:
    17

    If u have had any chase cc accounts which earned points or miles and were closed, the points should’ve been forfited when closed. However, for some reason, all points and miles are posted back in those accounts. If u had ink business, freedom pr sapphire, log on to chase.com and youll see them there. If they were miles, check you ff program

    ReplyReply
  18. HansGolden Says:
    18

    My understanding is that this only applies to federal lawsuits, but not state lawsuits. Please correct me if I’m wrong.

    ReplyReply
  19. simcha Says:
    19

    good get a real job and stop trolling for freebies your entire life

    ReplyReply
  20. Anonymous Says:
    20

    @Sl: i had saphire accounts that were closed for 2 years now how can i access them

    ReplyReply
  21. josh Says:
    21

    @Adam:

    AGREE ADAM! Lot of people here im sure pull this crap daily..its not right

    ReplyReply
  22. Sl Says:
    22

    @anonymous
    Not sure they went that far. I think only for the accounts closed within the last 3/4 yr

    ReplyReply
  23. Shaul Yaakov Says:
    23

    Airline miles aren’t a currency- they are a loyalty reward. The airlines only honor them because they would lose customers if they didn’t. Thoretically, an airline could discontinue mileage immediately if it ceased to be profitable and there would be nothing anyone could do except take their business elsewhere.

    ReplyReply
  24. Adam Says:
    24

    @Dan: Agree with you that its petty of the airlines to take away his miles that he had already earned.

    In regards the airlines losing his future business, I think the airlines figured they would rather sacrifice its future business with him than have to deal with him ever again!

    If you had a reader who consistently signed up credit cards through your website, BUT that same reader negatively commented and complained about every single article you put up, would you sacrifice the future referral points of him signing up for credit cards though your site for him not visiting the website anymore… (P.S. don;t know why anyone would ever complain about this blog … BEST TRAVEL BLOG OUT THERE 🙂

    ReplyReply
  25. Dan Says:
    25

    @HansGolden:
    Didn’t this start as a state lawsuit?

    @Anonymous:
    Login to your old chase.com account.

    @Shaul Yaakov:
    No, miles are a profit center. American and United make all of their profits from selling miles.

    @Adam:
    Lol, well now that you put it that way 😀

    And thank you, I really appreciate it. So much negativity out there of late.

    ReplyReply
  26. zvi Says:
    26

    No one addressed the fact that the plaintiff’s professional status, and title, was irrelevant, and would have been better had it been left out.

    ReplyReply
  27. Anonymous Says:
    27

    @Sl: I am not sure if they gave me the points. But they definitely did not give me the points that I should have gotten for paying off the balance after they closed my account.

    ReplyReply
  28. Mike Says:
    28

    I agree!

    ReplyReply
  29. Bostener Says:
    29

    Sad news
    Makes me wonder what these justices thing.

    ReplyReply
  30. Dan Says:
    30

    @Bostener:
    Actually it’s perfectly clear what they’re thinking, just like I wrote.

    ReplyReply
  31. Art - I am a lawyer Says:
    31

    This was a unanimous Supreme Court decision, and it is correct. The rabbi sued the airline in California federal court alleging that Minnesota’s contract law was breached when Northwest cancelled his miles. The Court properly held that federal airline rate laws preempt state contract law under the supremacy clause of the US Constitution. I don’t think a suit for non-fare purchases against an airline would succeed, although a suit against the bank issuing the card might. The language from the opinion as follows shows why this is true, because miles are maintained by the airline: “[T]he Northwest [frequent flyer] program is connected to the airline’s ‘rates’ because the program awards mileage credits that can be redeemed for tickets and upgrades. When miles are used this way, the rate that a customer pays, i.e., the price of a particular ticket, is either eliminated or reduced. The program is also connected to ‘services,’ i.e., access to flights and to higher service categories.”

    ReplyReply
  32. Dan Says:
    32

    @Art – I am a lawyer:
    This decision is definitely correct, but I don’t agree with you that miles earned from CC spend can be taken away nilly willy by an airline.
    Especially if you argue you would redeem for a non-flight award.

    ReplyReply
  33. avi Says:
    33

    Let’s not confuse chase spg or amex with airlines. While airlines may be immune to lawsuit, other companies in no way are. Scotus ruled not on the argument but on the standing to sue in the first place in regards to an airline. Nothing else. If chase were to take your points sue away. Also you clearly can sue the credit card companies like citi who issue airline points.

    ReplyReply

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