BEFORETHE U.S. DEPARTMENT OFTRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.
Mike Borsetti et al., Third-party Complainant DocketDOT-OST-2014-0166 v. BritishAirways Plc

BRITISHAIRWAYS PLC ANSWERTO COMPLAINT

Communicationswithrespectto this document shouldbe sent to:

Richard Mendles General Counsel, Americas James B. Blaney Senior Counsel, Americas BritishAirways Plc 2 Park Avenue, Suite 1100 New York, NY 10016 richard.mendles@ba.com jim.blaney@ba.com
October21,2014 Don H. Hainbach Jason E. Maddux Garofalo Goerlich HainbachPC 1200NewHampshireAvenueNW Washington, DC 20036 Phone:202-776-3970 dhainbach@ggh-airlaw.com jmaddux@ggh-airlaw.comMike Borsetti et al., BEFORETHE U.S. DEPARTMENT OFTRANSPORTATION OFFICE OFTHE SECRETARY WASHINGTON, D.C.
Third-party Complainant DocketDOT-OST-2014-0166 v. British AirwaysPic

BRITISHAIRWAYS PLC ANSWERTO COMPLAINT
British Airways Pic ("British Airways") hereby answers the complaint (the "Complaint") filed by Mike Borsetti ("Mr. Borsetti") relating to transportationprovidedto Mr. Borsetti andhis family between Los Angeles and London on February 14, 2014. Except as otherwise stated below, British Airways denies the allegations ofthe Complaint and respectfully requests that the Department of Transportation (the "Department") dismiss the Complaint without further investigation or order pursuant to 14 CFR 

### §302.406(a)(2). The structure ofthe Complaint and the assertion of legal and other conclusions do not lend themselves to a precise responsive pleading. To the extent that there is any factual statement or allegation that is not specifically admitted ordeniedherein, it should be deemed to have been denied. Introduction British Airways respectfully urges the Department to decline to commence an investigation or formal enforcement proceeding. There is no basis to do so. Mr. Borsetti's Complaint is apparently based on his misapprehension that the Department is the appropriategovernmental entity to enforce requirements imposed by European Community Regulation 261/2004 (''EC 261/2004"). Mr. Borsetti citesno authority for that assumption and none exists. Mr. Borsetti asserts numerous violations ofthe denied boarding provisions ofPart 250. However, those assertions do not account for the factual circun1stances in effect on February 14 and are not compelling given that Mr. Borsetti and his travelling companions were able to travel
on BA 268 on February 14. Mr. Borsetti alsomakes a numberofassertions regarding various sections ofPart259 and Part 374. Forthe mostpart, those assertions are not accurate. Finally, Mr. Borsetti asserts that British Airways violated section 90(D) of its International PassengerRules Tariff. Section 90(D) need notbe consideredinthis proceeding.
Factual Background Mr. Borsetti acknowledges he and his family were traveling on a ticket issued by American Airlines ("American") and were scheduled to travel initially on an American flight from Los Angeles to London onFebruary 14, 2014 (Cmnplaintat 3). Specifically, Mr. Borsetti's Complaint indicates that he and his family were ticketed to travel on American Flight #136 (AA136) scheduled to depart Los Angeles at 6:35 pin local time (Appendix pages 21-32). He further acknowledges there were numerous flight cancellations on that date due to winter storms in other parts ofthe country (Complaint at 4); and he asserts that at approximately 2:50 pm on the date ofthat flight, American stafT advised him and his family to travel on a British Airways operated flight (Complaintat 3). British Airways disputes Mr. Borsetti's assertion that the details regarding his initial booking by American for transportation on an aircraft operated by American are "[not] relevant to the instant dispute" (Complaint at 3). Moreover, Mr. Borsetti's Complaint does not provide a 2complete picture ofthe circumstances occurring on February 14. Severe winter weather along the east coast resulted in thousands offlights being delayed or canceled on February 13 and 14, and customers were being rerouted and rebooked on whatever space was available. 1 To further addto the already difficult logistical situation arising from the widespread cancellations resulting from the winter storm conditions, American Flight #137 from London to Los Angeles had a medical emergency onboard and was diverted to Winnipeg, Canada. As a result of that diversion, the return flight to London (AA136), on which Mr. Borsetti and his family had been ticketed, was canceled. Following cancelation of AA136, American staff at Los Angeles contacted British Airways in an effort to accommodate passengers, who had been booked on AA136, on British Airways Flight #268 (BA268). At that time, British Airways advised American that only economy class seats were available and requested that no additional bookings be made in the Club World/business class cabin. American personnel at LAX complied with that request, but travel agents and American reservation agents, who may not have been aware of the British Airways request, apparently continuedto book passengers in the premium cabins. Although Mr. Borsetti and his family were not able to travel in the Club World/business class cabin on BA268 to London, they were able to travel to London in the World Traveller/economy class cabin. Indeed, British Airways' Los Angeles statirecalls that upon being advised that only economy

As reported by USA Today on Friday, February 14, 2014, ''[W]ith nearly 13,500 flights canceled across the nation since Monday, U.S. carriers had a large backlog ofdisplaced passengers to clear in the coming days.'' USA Today further reported that more than I,400 flights had been canceled nationwide as of 3:20 pm ET on Friday (February 14), and that more than 6,500 flights were canceled on Thursday (February 13). (Mutzabaugh, Ben. "Flight cancellations top 13,400 as brutal travel week ends." USA Today. 14 Feb 2014 http://www.usatoday.com/story/todayinthesky/2014/02/II/another-winter-weather: headache-for-air-travelers-tuesday/5388691/)


### 3seats were available on BA268, Mr. Borsetti decided to acceptthose seats, shookthe hand ofthe BA duty manager, andthankedhimfor his assistance. On February 17, Mr. Borsetti requested a refund for his "involuntary downgrade'' (Complaint at 5 & Appendix page 3)_2 Three days later, on February 20, British Airways CustomerRelations staffacknowledgedreceipt ofthatrequest (Complaint at 5 & Appendix page 5). Mr. Borsetti sentfurther correspondenceto BritishAirways onFebruary 25 (Appendix pages 7-8), which British Airways acknowledged that smne day (Appendix pages 9-10), and he submitted an informal complaint to the Department on that date (Appendix pages 11-12).3 British Airways sent an additional acknowledgment on March 4 (Complaint at 6 and Appendix page 15). British Airways also sent additional correspondence to, or otherwise communicated with, Mr. Borsetti on March 4, March 12, March 15, March 17, March 19, March 23, March 25 (x3), March 27, April 9, April 25, May 13, May 21, June 4, and June 5 (Appendix pages 49-50, 16-17,18,47-48,34,37,41,45,47-50,51,54,56-58,59-60,64,68-69, and 70-71, respectively). In addition, Mr. Borsetti requested a telephone conversation with BA customer service personnel, whichtookplace onMay 13 (Complaint at 8).4

Mr. Borsetti's Complaint and correspondence indicate that he believes he is entitled to a payment of$8,336.10 reflecting 75o/o ofthe full value ofthe complete itinerary for his American tickets, including 75% of the monetary value Mr. Borsetti attributed to complimentary American upgrade certificates utilized by two ofhis traveling companions. Mr. Borsetti acknowledges that those upgrade certificates have no cash value (Appendixpage 4). On May 14, 2014, British Airways forwarded its responses dated March 4, March 17, April 25, and May 13 to the Depat1ment. On May 13, 2014, Mr. Borsetti stated to the Department, "I have not received any communications from British Airways" (Appendix Page 61). As the record demonstrates, British Airways personnel had communicated with Mr. Borsetti, both orally and in writing, more than a dozen times between receipt ofhis Complaintforwarded by the Department and May 13.

4On March 4, British Airways offered Mr. Borsetti "'[b]y way of an apology, and as a gesture ofgoodwill" a payment ofeither 

### 300 GBP, 

### $500 USD, ora 

### $650 USD credit voucherto be applied against a future British Airways flight purchase for each member of his party (Appendix page 

### 49-50). That offer was not intended to substitute for, or offset, any subsequent compensation for the downgrade. Indeed, in the same correspondence, British Airways personnel stated: "[a]dditionally, Ihave created a clain1, passing your correspondence andtravel records to our Refunds department requesting they investigate your claim as quickly as possible to refund the fare compensation due." (Appendix page 

### 16.) Mr. Borsetti never indicated which option he preferred, despite that offer being reat1irmed on March 

### 12, March 

### 17, March 

### 25 and April 

### 25 (Appendix pages 

### 16 and 

### 48-50, 47-48, 47, and 

### 57-58, respectively), and his Complaint confirmsthathe chosenotto acceptthat goodwill gesture (Complaintat 6). Mr. Borsetti subsequently received three checks for 

### $408 and a credit card refund for 

### $949.5 The 

### $949 credit card refund reflects refunds of

### $641, $132, and 

### $176, which are 

### 75% of the fare values BritishAirways understands to have been assigned by American (the carrier from which Mr. Borsetti purchased his transportation) to the LAX-LHR sectors of Mr. Borsetti's ticket andthose oftwo ofhis family. Sincemakingthis refund, British Airways has continuedto review the compensation provided to Mr. Borsetti and his traveling companions and has processed an additional refund of

### $611, which represents 

### 75% ofthe fare value British Airways understands to have been assigned by American to the LAX-LHR sector of Mr. Borsetti's remaining family member. In addition, British Airways is requesting American to make an appropriate adjustment to Mr. Borsetti's AAdvantage account to ret1ect the inability ofhis two

As best British Airwayscan determine, thethree $408checks were sentto Mr. Borsetti in error.


### 5traveling companions to use the AAdvantage upgrade certificates.6 Moreover, British Airways remains willingto provide, as a gesture ofgoodwill, a payment ofeither 300GBP, $500USD, or
a $650 USD credit voucher to be applied against a future British Airways f1ight purchase for each memberofhis party. Applicable Legal Requirements The Complaint's multiple references to EC 261/2004 (Complaint at 5, 16, 17, 18, 21, 22, and 23) indicates that Mr. Borsetti's claim for 75o/o ofthe value ofhis tickets is based on his reading of that European regulation.7 British Airways does not dispute the applicability of
Making an appropriate adjustment would be consistent with the Department's policy regarding denied boardingcompensation for zero fare ticket holders. Specifically, in the preambletothe Enhancing Airline Passenger Protections final rule, the Department stated, "the carrier must credit the amount of frequent flyer miles used for an upgrade back to the passenger's account ifany substitute transportation provided is not in theclass ofservicethathe orshe used thefrequent-flyer milesto acquire." 76 Fed.Reg. 23110, 23138 (Apr. 25, 2011). Mr. Borsetti's Complaint and correspondence indicate that he believes he is entitled to a payment of $8,336.10, reflecting 75o/o of the full value of the American tickets and complimentary upgrade certificates issued to him and his family members including sectors on which he was not downgraded and on which he was transported in business class (Complaint at 5). Those tickets provided for travel for Mr. Borsetti and one ofhis family members from Milan- New York- San Francisco- Los Angeles- London

- Milan (Appendix pages 21-23 and 30-32). The tickets for the other two family members provided for travel from San Francisco- Los Angeles- London- Milan- New York- San Francisco (Appendix pages 24-29). Mr. Borsetti's Complaint does not provide any indication that he and his traveling companions were unable to travel in business class on any sectors other than the Los Angeles

- London flight on February 14. British Airways does not dispute Mr. Borsetti's position that EC 261/2004 requires that he be compensated for 75% ofthe value ofthose portions ofhis itinerary where he was downgraded, but does not agree thathe is entitled to compensation for sectorson which he was transported in businessclass and on which he did notexperience the inconveniencethat EC 261/2004 is intended to redress. In thatregard, it is interesting to note that one of the proposed clarifications to EC 261/2004 being decided by the European Parliament in 2014/2015 would clarify what is meant by "price of ticket" by including a definition of"flightprice" and only the relevant flight sectorwould be applicable. The proposed wording from the EU Commission is: "Flight price'' means the value obtained by multiplying the ticket price by the ratio between the distance ofthe flight and the total distance ofthejourney(s) covered bytheticket. This proposed wording could ofcourse change before it is in its final form, but the proposed wording 6EC 261/2004, and it is prepared to comply with all obligations imposed on it pursuant to that regulation. However, just as the European Commission has no jurisdiction to enforce the Department's consumer protection regulations, the Department has no jurisdiction to enforce EC 26112004. Mr. Borsetti's Con1plaint does not provide any support for his assertion to the contrary, and none exists. The Departmenfs authority is limited to the enforcement of applicable sections ofthe Transportation Code, 49 U.S.C. Subtitle VII, and regulations or orders prescribed thereunder. EC 261/2004 is neither in the Transportation Code nor a regulation or order prescribed thereunder. As recognized in a recent series offederal cases, deference should be accorded to the European Union Member State agencies properly charged with enforcing EC 261/2004.8 Mr. Borsetti should raise his complaint with the appropriate European authorities and not petitionthe Departmentfor reliefthat it cannotgrant. Similar to Part 250 and related Department consumer protection regulations, EC 26112004 provides for a comprehensive consumer protection regulatory scheme. Having chosen to pursue the remedies provided by EC 261/2004, it is not appropriate for Mr. Borsetti to askthe Department to enforce that European regulatory requirement, nor is it appropriate for Mr. Borsetti to invoke the Department's consumer protection regulations. Mr. Borsetti's claim for damages under EC 261/2004 demonstrates his decision to invoke the consumer protections provided by the European regulatory scheme. Just as it is not appropriate for him to ask the Department to enforce the European regulations governing compensation for a downgrade, it is provides an indication ofwhat was meant in the draftingofEC 261/2004 and is now soughtto be clarified with this amendment.
8See, e.g., Lozano v. United Continental Holdings, Inc., 2013 WL 5408652 at 3 & 4 (N.D.I.L. '13); Volodarskiy v. DeltaAirLines, Inc., 987 F.Supp.2d 784, 790 (N.D.I.L. '13); and Polinovskyv. Deutsche Lufthansa, AG, 2014WL 958666 at3 (N.D.I.L. '14). 7

### not appropriate for him to pick and choose between ditierent portions ofthe European and U.S. consutnerprotectionregulatory schemes. Moreover, to the extent the Department believes that its consumerprotection regulations apply to the incident at issue, notwithstanding Mr. Borsetti's pursuit ofthe monetary damages specified in EC 261/2004, the requirements ofthose regulations would have to be considered in the context ofthe factual circumstances in effect on February 14. Those circumstances included the thousands of flight cancelations resulting from the winter storms on the east coast, the cancelation ofAmerican's Los Angeles-London flight (AA136), which was scheduled to operate two hours prior to BA268, and the numerous passengers from the American flight who immediately and understandably attemptedto rebook on BA268. With respect to the Complaint's allegations regarding specific regulatory violations, and subject to British Airways' position that Mr. Borsetti's pursuit ofremedies under the European
consumer protection regulatory scheme should limit his ability to invoke the corresponding U.S. regulations, BritishAirways responds as follows: With respect to the allegation that British Airways violated §

### 250.2a by not ensuring that the smallest number ofpassengers holding confirmed reservation space on BA268 were denied boarding involuntarily, it should be sufficient to note that all passengers holding confirmed reservations, including Mr. Borsetti and the othermembers ofhisparty, were carriedon BA268. With respect to the assertion that British Airways violated 

### § 250.2b by failing to solicit volunteers for denied boarding, British Airways notes (1) the chaotic airport situation described above, and (2) that all passengers holding confirmed reservations, including Mr. Borsetti and the othermen1bers ofhis party, were carriedon BA268.

8With respect to the § 250.3 requirement that carriers establish priority rules and criteria for determining which passengers holding confirmed reserved space shall be denied boarding on
an oversold flight, BritishAirwayshereby confirmsthatit had established suchpriorityrules. With respect to Mr. Borsetti's allegations regarding§ 250.6(c), British Airways notesthat § 250.6 is titled Exceptions to Eligibility for Denied Boarding Compensation (emphasis added). Moreover, and as noted above, Mr. Borsetti's Complaint demonstrates that he has chosen to pursue his compensationrights under EC 261/2004. Underthose circumstances, BritishAirways submitsthatno additional refund is owedunderthe Department'srules. With respect to the §250.89 requirement that denied boarding compensation be madethe
same day or at the most within 24 hours, this section is inapplicable to Mr. Borsetti and his family because they were accommodated on BA268. As noted above, the language of §250.6 makes it clear that any refund to which Mr. Borsetti may have been entitled was not denied boarding compensation. Specifically, "[a] passenger denied boarding involuntarily from an oversold f1ight shall not be eligible for denied boarding compensation if:
... (c) The passenger is ofTered accommodations or is seated in a section ofthe aircraft other than that specified on the ticket at no extra charge, except that a passenger seated in a section for which a lower fare is charged shall be entitled to an appropriate refund." (Emphasis added.) Mr. Borsetti and his family were accommodated on BA268. Accordingly, no denied boarding compensation was due, so the requirement for the timely paymentofdenied boarding compensationin §250.8 does not apply.

British Airways believes Mr. Borsetti intended to cite § 250.8 instead of § 250.9 on page 17 of the Complaint.

9With respect to the §250.9 requirement to provide a written statement to passengers denied boarding involuntarily, British Airways submits that any such requirements should be considered in the context of (1) the chaotic airport situation described above, and (2) that all passengers holding confirmed reservations, including Mr. Borsetti and the other members ofhis party, werecarriedon BA268. Mr. Borsetti's assertion that British Airways' failure to list check-in deadlines in its customer service plan or conditions ofcarriage violates 14 CFR §259.5 and 49 U.S.C. §41712 is baseless. There is no Department requirement to include check-in times in a carrier's customer serviceplanor conditions ofcarriage. With respect to 

### § 259.5(b)(5) and Part 374 of the Department's regulations, British Airways acknowledges that Part 374 incorporates the requirements of the Federal Reserve Board's Regulation Z, 12 CFR Part 226, which requires creditors to transmit a credit statement for a refund to the credit card issuer within seven business days ofreceipt offull documentation for the refund requested. In the present matter, British Airways did not receive full documentation for the refund requested until Mr. Borsetti provided the credit card numberfor his original form of payment. Because Mr. Borsetti purchased his tickets on American, British Airways did not have access to the information for his original fonn of payment and was required to obtain this information directly from Mr. Borsetti. Indeed, Mr. Borsetti delayed the receipt ofhis refund by failing to provide his credit card information despite repeated requests from British Airways. (Appendix pages 34, 41, and 45.) Moreover, in the final analysis, the Department'srules regarding the tin1ing ofrefunds should not apply to Mr. Borsetti'srequest for compensationunderEC 261/2004.

10Withrespectto the§ 259.7(c) 30-day deadline for acknowledging written complaints and the 60-day deadline for providing a substantive written response, British Airways complied with these requirements. Mr. Borsetti made his initial refund request on February 17, which BA acknowledged three days later, on February 20 (Appendix page 5-6). Mr. Borsetti sent an additional complaint to British Airways on February 25, which British Airways acknowledged receipt ofthat same day (Appendix page 9-10). Also, on February 25, Mr. Borsetti submitted an informal complaint to the Department, which British Airways acknowledgedreceipt ofonMarch 4 (Appendix page 15), within one day of receiving the complaint from the Department. 10 Accordingly, British Airways acknowledged all written complaints within 30 days ofreceipt. British Airways also provided substantive responses at least twice within 60 days ofreceiving Mr. Borsetti's complaints, on March 17 and 25 addressing the substantive issues of the complaints by confirming that compensation was due under EC 261/2004 (Appendix pages 47- 48). As the record demonstrates, the present case involved complex issues that British Airways continued to investigate up to its sending offinal replies on May 21 and June 5, confirming the paymentofcompensationdueunderEC 261/2004, and is continuingto investigate.11 With respect to British Airways' alleged violation of section 90(0) ofits International Passenger Rules Tariff, as noted above, Mr. Borsetti's Complaint demonstrates that he has

10 The Complaint's allegation that British Airways failed to provide its response to Mr. Borsetti's informal complaint to the Department, as per the Department's request, is equally baseless. British Airways provided the Departmentwith a response on May 14,2014. Accordingly, British Airways deniesthis allegation. II The Depat1ment has acknowledged that ''for difficult cases involving complex issues a carrier can provide a substantive response to the passenger within 60 days based on what the carrier knows at that time, continue its investigation, if necessary, and send a final reply once the investigation is complete.'' (Answers to Frequently Asked Questions Concerning the Enforcement ofthe Second Final Rule on EnhancingAirline Passenger Protections at 18.)
11chosen to pursue the statutory remedy amount established by EC 261/2004. Under these circumstances, Rule 90(D) neednotbe consideredin this proceeding. 12 Affirmative Defenses 1. The Complaintfails to state a claim upon whichreliefmaybe granted. 2. Complainant lacks aprivateright ofactionunder49 U.S.C. 

### §41712. 3. Complainant lacks standing. 4. The Complaintis, in whole orinpart, moot. WHEREFORE, for the reasons stated above, British Airways Pic respectfully requests thatthe Departmentdismissthe Complaintpursuantto 14 CFR § 302.406(a)(2).



# ~7~



# ~i~c~ 1

ason E. Maddux Garofalo Goerlich HainbachPC 1200NewHampshire AvenueNW Washington, DC 20036 Attorneys for BritishAirwaysPlc

12 Tothe extentRule 90(0)was applicable, it would provide only for compensation based on the transportation "betweenthe points wherethe lower class ofservice is used." 12CERTIFICATEOF SERVICE 

### Iherebycertifythat onthis

### 21th dayofOctober, 

### 2014, a copyofthe foregoing Answer of BritishAirwaysPlcwas servedviaelectronicmailontheparties namedbelow:

MikeBorsetti BlaneWorkie ClereeceKroha**mike~i\borsetti.con1** blane.workie(a),dot.gov clereece.kroha(a)dot.gov