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Travel Law looks at airline "guarantees"


Airline low fare and best fare guarantees: What do these words mean?

Hon. Thomas A. Dickerson  Jan 06, 2016

In this week’s article we examine two recent cases, Coulier v. United Airlines, Inc., 2015 WL 2452393 (S.D. Texas 2015) and Opper v. Delta Air Lines, 2015 WL 94193 (E.D. Wis. 2015) wherein the plaintiffs alleged that the defendant airlines, United and Delta, failed to meet their assumed obligations, respectively, under their “Low Fare Guarantee” and “Best Fare Guarantee”. What do these words really mean?

Travel Law Update

Hotel Fire In Dubai

In Droubi, Fire Engulfs Luxury Dubai Hotel, Forcing Evacuation of New Year’s Crowd, nytimes.com (12/31/2015) it was noted “The fire at the hotel, the Address Downtown Dubai, occurred just hours before a fireworks display was scheduled to place nearby. Teams of firefighters battled the flames for hours...Fourteen people were reported to have sustained minor injuries...It was a very windy evening and the fire raged through the middle and upper floors of the 63 story building”.

Uber’s Expansion In Germany Fizzles

In Scott, Uber’s No-Holds-Barred Expansion Strategy Fizzles in Germany, nytimes.com (1/3/2016) it was noted that “Uber is rapidly expanding its ride-sharing operations across the globe. But here in this city of 690,000-less than the population of San Francisco, Uber’s hometown-the company recently did something unusual: It retreated. In early November, Uber shut its small office in Frankfurt’s centuries-old city center after just 18 months of operation, mothballing the online platform that had let people in the city hail rides through a smartphone app. The pullback was spurred in part by drivers like Kasan Kurt, the owner of a small licensed taxi business, who had refused to work with the American service (who) disliked how Uber barreled into Frankfurt in early 2014 using primarily unlicensed drivers who had not passed the same exams and health checks required of licensed drivers...UberPop, which is similar to UberX in the United States...was eventually outlawed, last March, by German regulators”.

Congo’s Airlines Still Blacklisted

In Congo’s airlines remain blacklisted by the EU, eturbonews.com (1/2/2016) it was noted that “Most of Congo’s airlines remain on the EU Blacklist for a range of issues, maintenance related, training related and to a good part oversight related”.

Boeing 767 Escape Slides

In FAA seeks safety fixes to Boeing 767 escape slides, marketwatch.com (12/31/2015) it was noted that “The preliminary Federal Aviation Administration directive, which would apply directly only to 767 aircraft operated by U.S. carriers, was prompted by what the agency described as ‘multiple reports of uncommanded escape slide inflation’...The FAA’s proposal is unusual because it concerns slides possibly opening during normal operations, not problems with deployment during emergencies”.

Train Stations Evacuated In Munich

In ‘Imminent terror attack’ threat: Train stations evacuated in Munich, eturbonews.com (12/31/2015) it was noted that “Less than an hour before New Year Munich Police evacuated and closed Hauptbanhof and Munchen-Pasing train stations due to terror threat attacks”.

Tunisia

In 12 dead in attacked on Presidential Guard’s bus, Tunisia to declare state of emergency, eturbonews.com (11/24/2015) it was noted “A week earlier, Tunisian police foiled an attack in the resort of Sousse, after it raided a terrorist cell as they were preparing attacks against vital installations. Officials said 17 extremists, believed to have been trained in Syria and Libya, were arrested in the week preceding the foiled attack. The militants were reportedly awaiting to carry out assaults on politicians, beaches and landmark buildings during November... ‘Islamic State’ militant group had claimed responsibility for two major attacks in Tunisia this year. In March, gunmen attacked the Brado Museum in Tunis, claiming the lives of 23 people. Sousse was the site of the second attack, as 38 foreigners were killed in a mass shooting by armed gunmen at a beach resort in June. Meanwhile, the ‘Islamic State’ affiliate in Egypt ‘State of Sinai’ claimed the attack against a hotel in North Sinai hosting election Judges on Tuesday, leaving seven people dead”.

Banned In Ukraine

In Total flight ban: Ukraine closes its airspace to Russia, eturbonews.com (11/25/2015) it was noted that “Ukraine’s prime minister said his government has decided to close the country’s airspace to all Russian planes...The decision comes as tensions simmer between Russia and Ukraine following Russia’s annexation of Crimea and a separatist war in eastern Ukraine that has killed more than 8,000 persons...The Russian gas monopoly Gazprom announced earlier on Wednesday that it was cutting gas supplies to Ukraine because the country has not paid in advance for supplies”.

Cuba Questions And Answers

In US Department of the Treasury’s authorized Cuba travel-related transactions update, eturbonews.com (11/25/2015) it was noted that “the Department of the Treasury’s Office of Foreign Assets Control (OFAC) updated its Frequently Asked Questions with regard to Cuba to add question #52 regarding the processing of authorized Cuba travel-related transactions by financial institutions subject to U.S. jurisdiction”. The specific topics covered include questions regarding Embargo, Travel, Travel and Carrier Services, Remittances, Banking, Trade/Business, Telecommunications and Miscellaneous.

Hoverboards And Swagways

In Holson, Laws Struggle to Keep Up as Hoverboards’ Popularity Soars, nytimes.com (11/25/2015) it was noted that “They are this year’s must-have holiday item, coveted by children and adults alike. Retailers are promoting them heavily...they are an increasingly common sight on city streets across America. But in many places-from New York State to individual schools, malls and stores-they are illegal. Self-balancing motorized boards have many names: hoverboards, Swagways, self-balancing scooters and, among the Star Trek crowd, personal transporters. But whatever they are called, they now have parents, lawmakers and others struggling to figure out how safe they are and how to regulate them because in most places the rules have not caught up with the new technology...In California, by contrast, lawmakers have tried to get ahead of the problem: A new law effective Jan. 1 will allow electric-powered boards to be ridden in bike lanes and pathways, ideally to help commuters break free from cars and bicycle traffic. ‘What we had in mind was the short-distance commuter’...In London, the authorities recently reminded residents that the boards are banned from public street and roadways because they are dangerous...The new California law mandated that hoverboard users on bikeways be at least 15 and wear the same gear required when riding a bike”.

Taipei Diamond Theft

In Chinese tourists sought after Taipei diamond theft, eturbonews.com (11/21/2015) it was noted that “Thieves stole a 3.2 carat diamond, valued at NT$4.2 million (US$128,323) from the Taiwan Jewelry and Gem Fair held at the Taipei World Trade Center...The thieves came from China, entering on tourist visas...Police officials said that the three used a ‘divert and switch’ play, replacing the diamond with a cubic zirconia while staff were distracted”.

The Coulier Case

In the Coulier case, supra, the Court noted that “This is a breach of contract case relating to United’s ‘Low Fare Guarantee’. Plaintiff Scott Coulier purchased three one-way tickets on United’s website, united.com, on January 26, 2014. He asserts that he was aware, at the time, that United had a Low Fare Guarantee, and he thus assumed that cheaper tickets were not available for any of the tickets he purchased. Coulier claims that he realized after purchasing the three tickets together that he could have purchased the same tickets separately for less on united.com. Coulier contends that when consumers purchase tickets as a group on united.com, if there are not enough tickets available in the lowest available class of fares, then the price for each ticket will be increased to the next available fare category, and the lower fare category will disappear from united.com and all other websites selling United tickets”.

The Disappearing $100 Fare

“For instance, if a consumer wishes to purchase three tickets at the lowest price and the only seats available on the plane are two seats at $100 each and five seats at $150 each, if the consumer buys three tickets separately on united.com before any other consumers take the $100 fare, the consumer will be able to purchase three tickets for $350 (two at $100 and one at $150). There would be four seats still available that cost $150 each. No seats costing $100 would be left. If the consumer instead buys the three tickets together, according to Coulier, rather than charging only $100 for the first two seats, United increases the two available $100 seats to $150 and sells all three seats at $150 each. The three seats purchased together thus cost $450 ($150 times 3). The $100 fares disappear altogether, and there are still, just as in the scenario in which the consumer bought the seats in separate transactions, four seats left at $150 each”.

The Low Fare Guarantee

“The Law Fare Guarantee advertised on united.com states: ‘Forget those so-called low-fare travel websites and spend less time planning and searching for flights. When it comes to finding the lowest United fare online, we guarantee you will find it on united.com. In fact, if find a fare for the same flight, itinerary and cabin at a price that is lower that the fare offered on united.com by $10 or more, we’ll make up the difference and give you a $100 USD Electronic Travel Certificate. And not only will you find the lowest fare at united.com, but you’ll never pay a service fee for booking online”.

Terms & Conditions Of Low Fare Guarantee

The relevant terms and conditions of the Law Fare Guarantee are (1) Your claim must be made by midnight local time in the country of this country-specific website on the same day on which the ticket is purchased, or within four hours if the ticket is purchased at 8 p.m. local time. Claims must be made by calling your local United Customer Contact Center office. Claims for this offer may not be made through any other United Airlines phone number.... (5) Tickets must be the least expensive available on united.com for the chosen itinerary at the time of purchase. ‘Lower online fare’ means air-only fare which are displayed and sold on a publicly-accessible Internet site for the exact same flights on the same travel dates for the same travel itinerary... Fares must be for the same cabin...and for the exact same flights that carry the same fare restrictions. (6) United Airlines must be able to verify the lower online fare online at the time of claim. Other methods of verification (e.g., faxes, screen prints, etc.) are not eligible”.

Impossible To Make A Claim

“Coulier contends that he purchased the tickets in united.com, as required by the Low Price Guarantee. He was, however, unable to prove that there was a lower published price online because, contemporaneously with selling a given ticket at the next-highest fare category when the ticket is sold in a group, United replaces the allotment of lower fares with more expensive fares, resulting in the elimination of any available lower fares. Coulier asserts that this made it impossible for him to locate the less expensive fares after he completed his purchase and it was impossible for any United representatives to find the lower fares on a publicly accessible Internet site”.

Breach Of Contract Claim

“Coulier filed this (class action) lawsuit against United (alleging a) breach of contract. Coulier contends that the Law Fare Guarantee becomes part of the consumer’s ticket contract with United as soon as the consumer purchases a ticket on united.com and that United breached the contract by failing to provide the lowest price per ticket which tickets are purchased as a group”.

The Court’s Analysis

“Coulier’s sole cause of action is a breach of contract claim...to determine whether Coulier has stated (such a claim) the court must first determine if the Low Fare Guarantee is an offer to enter into a unilateral contract or if it part of the bilateral contract of carriage entered into when a consumer purchases an airline ticket. United contends that the Law Fare Guarantee is an offer to customers who purchase tickets through the united.com website, that customers may accept the offer by performance, and that performance creates a unilateral contract. United argues that Coulier’s complaint demonstrates that he failed to perform because he does not allege that he found a published fare for the same flight and itinerary on a different website that was lower than the fare offered on united.com, called his local United Customer Care Center office, or filed a claim within the specified time limits...Coulier argues on the other hand, that he entered into a binding contract the moment he purchased his tickets on united.com and that the Law Fare Guarantee was a warranty that is part of the primary ticket contract (the contract of carriage). He contends that ‘itinerary’ does not include the number of passengers and that nothing in United’s Law Fare Guarantee states that he had to find the lower fare on a different website.

Contract Of Carriage Or Merely an Offer?

“The court finds that the Low Fare Guarantee is not part of the contract of carriage. United’s contract of carriage does not incorporate the Low Fare Guarantee, and the Low Fare Guarantee does not indicate that it is part of the broader contract... Moreover, the Low Fare Guarantee is not a warranty for any purchase of any ticket on United, it is an offer relating to purchases made specifically on united.com, and its purpose is clearly to incentivize purchasing one’s ticket on united.com even though tickets may be purchased elsewhere. The Low Fare Guarantee is separate and distinct from the contract of carriage...it is an ‘offer’. Acceptance is completed by performing the terms outlined in the portion of the guarantee that states ‘Here’s how this offer works’. To accept, a customer must (1) purchase a ticket at united.com; (2) find a published retail price online for the same United flight, itinerary, and cabin, that is lower than the fare published on the same day by $10 or more; (3) call the local United Customer Contact Center office; and (4) file a claim. Once this performance is complete, United must refund the difference in rice and provide the customer with a $100 travel certificate. The guarantee is thus an offer for a unilateral contract that the customer must accept by performance...Because Coulier did not substantially perform the unilateral contract, United was not obligated to perform”.

The Opper Case

Another case involving airline low fare guarantees is the Opper case, supra, in which “Opper filed a claim against (Delta) for violating its “Best Fare Guarantee’...(which) stated ‘The Best Delta Fares on the Web-Or Your Money Back. If you find a fare that is at least $10 lower on another website for the exact same Delta itinerary, then we’d like to make it right’. Opper claimed that Delta breached the guarantee by not offering the cheapest fare on each leg of a multi-leg journey. Delta’s website bundled the fees together for a multi-leg journey so that all legs would be in the same class fare, thus resulting in legs that may have been available at a lower class fare costing more than purchased as part of a multi-leg journey if the lower class of fares was not available on all legs. The Court treated the Best Fare Guarantee as a warranty. The court pointed out that the warranty specifically said the lower fare had to be on ‘another website’ and for the ‘exact same itinerary’. Since Opper did not identify any fares on other websites for the exact same itinerary, and instead relied exclusively on low fares that were available of delta.com, she failed to state a claim upon which relief could be granted. The court specifically noted that ‘the essence of the guarantee is comparative’ and Opper did not provide any basis for comparison”. wcpo.com

Justice Dickerson has been writing about travel law for 39 years including his annually updated law books, Travel Law, Law Journal Press (2016) and Litigating International Torts in U.S. Courts, Thomson Reuters WestLaw (2016), and over 400 legal articles many of which are available at nycourts.gov/courts/9jd/taxcertatd.shtml. Justice Dickerson is also the author of Class Actions: The Law of 50 States, Law Journal Press (2016). For additional travel law news and developments, especially in the member states of the EU, see IFTTA.org.

This article may not be reproduced without the permission of Thomas A. Dickerson.

Airline low fare and best fare guarantees: What do these words mean?
Hon. Thomas A. Dickerson



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