Robert Samstein Complaint

1 of 16 BEFORE THE DEPARTMENT OF TRANSPORTATION OFFICE OF AVIATION ENFORCEMENT AND PROCEEDINGS WASHINGTON, D.C.

------------------------------------------------------ ) ) Robert Samstein , ) third -party complainant ) )
v. ) Docket DOT

- OST -2014-____ ) American Airlines, Inc. ) )

------------------------------------------------------ ) COMPLAINT OF ROBERT SAMSTEIN Comments with respect to this document should be addressed to: Robert Samstein

E- ma il:

Dated: March 11, 2014Robert Samstein Complaint

2 of 16 BEFORE THE DEPARTMENT OF TRANSPORTATION OFFICE OF AVIATION ENFORCEMENT AND PROCEEDINGS WASHINGTON, D.C.

--------------------------------------------------------------- ) ) Robert Samstein , ) thir d

- party complainant ) )
v. ) Docket DOT

- OST

- 201 4

-

____ ) American Airlines, Inc. ) )

--------------------------------------------------------------- ) COMPLAINT OF ROBERT SAMSTEIN
1. This complaint arises out of American Airlines cancelling its morning nonstop service JFK

- LHR on which I had redeemed and ticketed an A A dvantage award

. AA then refus ed 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. T icket Issuance 2. On June 30, 2013 , I used AA.COM to redeem miles for one

- way coach award travel JFK

- LHR on March 30, 2014 . I chose the daytime departure to avoid an unpleasant overnight flight in addition to our tight restrictions of needing to arrive on Sunday and not being able to leave on Saturday evening for religious reasons

. T he itinerary calls for departure from JFK at 9:30am and arrival to LHR at 9:30 pm the same day. Travel was for my self and my wife (two passengers) , using miles from my wife’sRobert Samstein Complaint

3 of 16 AAdvantage account. I paid the $ 5 of taxes by credit card and received an itinerary and confirmation the same day. See Exhibit 1

. B. Flight Cancellation and Attempted Rebooking 3. On January 5, 2014 I happened to look over my itinerary on AA.COM , and I discovered that I had been rebooked onto an alternate flight JFK

- RDU

- LHR with an extended layover at RDU and an overnight flight to LHR. To the best of my knowledge, AA did not provide me with any sch edule notification email to that effect. (I have searched through the history of the email account associated with the reservation, mb.eichenbaum@gmail.com

. )
4. I called AA reservations to enquire about the chan ge . A reservations staff person told me that the original JFK

- LHR morning flight had been cancel l ed . The reservations person told me that the only morning flight available was a British Airways flight , but that AA would require me to pay an excess of $50 0 in “taxes and fees” to take that flight.
5. I requested that the fees be waived as this was due to a schedule change. While on the phone I pull ed up the American Airlines policy for schedule changes , https://www.aa.com/i18n/agency/Booking_Ticketing/Reaccom/rule_240_80.jsp

. That
page did indicate that transfer to another Oneworld carrier was an option according to

r ule 240/80. I was told that this was not an option and was offered to be rebooked on a flight Saturday evening March 29. I explained that this flight was not an option for me as I am an observant Jew and it would require travel on the Sabbath. C. Discussions with a Reservations Supervisor 6. At this point I asked to speak to a supervisor. A man came on the phone , introduced himself as a supervisor, and after explaining the situation repeated that theRobert Samstein Complaint

4 of 16 taxes would have to be charged. I discussed the rule 240/80 but was told that this does not apply to award reservations. After being told that my best choice is for the reservation to be canceled and my miles reinstated , I stated that I would call back at another point since I had a meeting to g e t to. D. Discussions by Twitter 7. I then tried reaching out to AA via Twitter. Our exchange was as follows 1 : Rsamstein: @AmericanAir My flight got canceled due to rescheduling and AA wants me to pay $250 in fuel surcharges to get on another flight. My res is , the issue is that due to Sabbath observance and when I need to arrive only BA flights work. AA seems to have eliminated AM flights and the PM flights arent late enough - I assume this is somehow due to the merger-I hope you can help AmericanAir: “We're sorry for the sch edule change, Robert. You can be changed to another airline if it 's available. However, the additional taxes will be collected. Please contact reservations for rebooking of the award. ” RSamstein: “The additional taxes are the cost of a paid ticket. I will just cancel and rebook on another airline. Though my travel agent said this violates DOT rule s and I should file a complaint.” AmericanAir: “ Our apologies again. AAdvantage will reinstate your miles and refund your taxes for no charge.” E. Further Discussions with a Reservations Supervisor 8. A few days later I called again and asked to speak to a supervisor. I began to explain the situation but was cut off and told that she was aware of the situation and was reading the “notes” on the reservation. She again confirmed that these “taxes” would have to be charged despite the fact that this was due to a schedule change. I argued that my original flight was canceled due to a marketing promotion between American Airlines and British Airways whereby the flight was transferred to BA to allow the c laim that all their flights had lie

- flat business class seats. (See discussion in paragraph 18 , below.)

1 Where Twitter ’s length limitations required multiple sequential messages, I combined those messages to r estore the messages as both parties intended to send them.Robert Samstein Complaint

5 of 16 She explained that there was nothing that she could do , and so I asked to speak to someone tha t could help . I was told I could receive a call back later from a manager.
F. Discussions with the Duty Manager 9. Later that day , I received a follow up call from a woman who explained

s he was the duty manager and received an indication that I wanted to speak w ith her

. She emphatically stated that there was nothing that could be done about the taxes and fees since they had to be paid and AA was not going to pay them. I pointed out that these were not taxes but rather fuel surcharges. I again asked about the pol icy described online which allows for carrier change and she stated that it would only be allowed in the case of an “emergent” schedule change within a day or two of flying. She stated that if the American flights did not work with my schedule then my mile s could be redeposited to my account but that this “offer” would not last indefinitely . I was given an ultimatum that I had to decide immediately otherwise I would not be offered it again. I stated that this was unreasonable and she granted me a day to dec ide before it would no longer be an option. The next day, without any other option , I was forced to cancel the flight and have my miles reinstated. I did not “agree” to that option in any meaningful sense. Rather, it was imposed on me as a result of Amer ican’s refusal to provide any alternative that better met my needs and matched the ticket I had ticketed and confirmed

. I was forced to make more expensive alternate arrangements as this was now only a few months before my travels rather than my original r eservation which I made fully nine months in advance

.Robert Samstein Complaint

6 of 16 II. AA is Obliged to Provide Transport ation on BA withou t A dditional C harge A. AA General Tariff 10. I believe the situation at issue may be appropriately considered as a change in schedule. AA’s International General Tariff provide s as follows: When a passenger will be delayed because of a change in its schedule, carrier will arrange to:
tr ansport 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 acc ordance with Rule 90 (REFUNDS). 11. I believe the three listed options are intended to be alternatives, separated by “or.”
12. The section is ambiguous as to who gets to choose among the three options. Following the standard principle of contract law that an am biguous 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 13 and onwards below.)
13. I choose the second of these options. Specifically, I choose to be endorsed to the nonstop BA operated service JFK

- LHR. Note that the second option makes no mention of any obligation to pay any differenc e in fare, tax, or surcharge.
B. AA “Schedule Change” Web Page and Rule 240/80 14. I also reviewed AA’s Schedule Change page which, according to AA, gives the “Rule 240/80” r ules for schedule irregularities . A t heading AA Schedule Change , the page provides as follows:Robert Samstein Complaint

7 of 16 [schedule change of] 91 minutes and greater O r the flight chang es 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*. 15. T he proposed schedule change is a change from a nonstop to a connecting flight, which triggers the quot ed 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 initial agent examined my record, 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

. 16. As discussed in paragraph 8 , an AA duty manager indicated to me that Aadvantage tickets are not protected by rule 240/80 or AA’s web site statements about reaccommodatio n . 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
in cluding AAdvantage, AA codeshare and Tr avel Agents free/reduced rate” and “ Rule 80 protects all ticketed customers including AAdvantage, AA codeshare and Travel Agents free/reduced rate. ”Robert Samstein Complaint

8 of 16 C. AA Commitments to DOT in Its Request for Antitrust Immunity with BA and Others 17. 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 se e king 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 fre q uent 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 th ese benefits

. 18. 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 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.
D. The Consumer Harm Resulting from AA Cancelling My Confirmed Ticketed Travel for a Marketing Benefit with BA 19. As best I can tell, AA canceled my original flight due to a marketing promotion between American Airlines and British Airways whereby the flight was transferred to BA to allow the claim that all their flights had lie

- flat business class seats.
See http://www.appointmentgroup.com/2013/10/tag/news

- from

- london/ba

- and

- aa - to

offer

- flat

- beds

- on - all

- flights

- between

- lond on - and

- new - york/ : “ A fully lie

- flat bed inRobert Samstein Complaint

9 of 16 business class on all 17 flights between London and New York

– that’s 1000 flat beds in business class a day in each direction. ” See also http://www.aa.c om/i18n/urls/moreeurope.jsp , reporting “ Beginning March 30, 2014, if you’re traveling in First or Business Class between New York and London, you can experience the unparalleled comfort of fully lie

- flat seats on every American or British Airways flight .” On information and belief, AA has sufficient aircraft with the specified seats and could serve all JFK

- LHR frequencies with such aircraft, but AA instead allocates those aircraft to other routes. On information and belief, this is the reason why
AA canc eled its morning service JFK

- LHR , prompting the problems I experienced

. 20. While AA’s flat beds may benefit some passengers, such as those who travel in business class, that is of zero value to me. M y ticket was for travel in coach.
21. I am perfectly happy to see AA take actions that benefit only a subset of customers. But here, as a result of the benefit AA sought to provide to business class customers, AA seeks to impose significant harm on me

— requiring me to pay hundreds of dollars of extra fees, or to acc ept an indirect routing with hours more travel time. These are significant downsides that should concern the DOT.

III. AA Continues to Mischaracterize C arrier
- I mposed F ees as “Taxes” 22. At least two of the AA representative s spoke with (I believe both of the supervisors) used the term “taxes” to describe the fees at issue. See the discussions summarized in section I above . When agents used the term “taxes , ” they used it until I corrected them. I provide my summaries of the discussions from memory ; I do not have call recordings , and more than two months has elapsed since the discussions . But I didRobert Samstein Complaint

10 of 16 know that the charges were large, and it didn’t make sense that they were taxes. I remember remarking, at the time, that the agents were mi susing the word “taxes.”
23. Furthermore, in its written reply via Twitter, AA staff specifically used the term “taxes” to describe the amount I needed to pay (“the additional taxes will be collected”). I had sent my record locator and had indicated that I wa s seeking to be reaccomodated on BA flights. Furthermore, I had carefully and correctly used the term “fuel surcharges” to describe the fee at issue. AA’s Twitter team thus had all the infor m ation it needed to confirm that the charge at issue is a surcha rge, not a tax, and furthermore I had led by example by correctly characterizing the charge. Nonetheless, AA’s Twitter team nonetheless falsely used the term “taxes.”
24. I note that these practices are ong oing and recent. My experience occurred during Janua ry 2014. My experience indicates that supervisors are also making the mischaracterization. A. My Experiences Matches Others’ Reports 25. I have reviewed the compla ints 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 no t have standing to bring such a complaint because he did not personally suffer such a cancellation. I do

. 26. 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 broadly similar. I perceivedRobert Samstein Complaint

11 of 16 that agents were less helpful to me after I brought thi s error to their attention. 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 27. 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 28. AA staff repeatedly used the wo rd “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 receive d 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 surcharges and fuel surcharges are “revenue” and “fares, rates and pricing” within the meaning of th ese statements. Thanks to the full antitrust immunity DOT provided to American and British Airways based on their representations in the 2008

- 0252 docket , American b oth influences and benefits from British Airways surcharges. Having sought these privileges from DOT and represented to DOT that it would use them, AA cannotRobert Samstein Complaint

12 of 16 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 29. 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.
30. I understand that AA cancel ed 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 pa ssengers 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 indicatio ns AA is refusing to reaccommodate passengers on 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 (paragraph 18 above ). This is far from the passenger benefits AA promised when seeking JBA approval from DOT.
31. The amount at issue is substantial. AA staff told me that I would nee d to pay a surcharge of approximately $250 per person one

- way to fly JFK

- 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 $1 3 00. After deducting genuine government
taxes, a $500 round

- trip surcharge is nearly half of the valu e that passengers expect to be covered by award point redemption.Robert Samstein Complaint

13 of 16 32. 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; ( 3 ) Pursuant to such investigation, o rder American Airlines to refund to ticket purchasers all monies at any time 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 re accommodation 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 the ir rights in this circumstance and to assist such passengers in vindicating those rights even if American employees mistakenly attempt to deny those rights;Robert Samstein Complaint

14 of 16 (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

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 C onsent O rder specifically requires that AA permanently ce ase 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
t hese 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 b y AA supervisors and duty managers.

Respectfully submitted , /s/ Robert SamsteinRobert Samstein Complaint

15 of 16 Attachment 1Robert Samstein Complaint

16 of 16 Certificate of Service

I h ereby certify that I have, this 11th day of March, 2014 caused a c opy of the foregoing Complaint to be served by electronic mail on the following persons: Robert Silverberg , Esq. rsilverberg@sgbdc.com Robert Gorman , Esq. robert.gorman @dot.gov

/s/

_____________________ Rob ert Samstein