Major airlines sue Biden administration over fee disclosure rule (updated)

Hawaiian Holdings

13/05/2024 15:58

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      Disclosures to help consumers avoid unexpected fees-USDOT
    

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      Baggage or flight-change fees must be cleary disclosed
-USDOT
    

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      Airlines must inform consumers that seats are guaranteed
    

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      Rule is "arbitrary," "contrary to law" -airlines' lawsuit
    

  
 (Adds details from lawsuit, background, no immediate USDOT
comment)
    By David Shepardson
       WASHINGTON, May 13 (Reuters) - Major U.S. airlines are
suing the U.S. Transportation Department (USDOT) over a new rule
requiring upfront disclosure of airline fees, the latest clash
between air carriers and the Biden administration.
    Airlines for America, along with American Airlines  AAL.O ,
Delta Air Lines  DAL.N , United Airlines  UAL.O , JetBlue
Airways  JBLU.O , Hawaiian Airlines  HA.O  and Alaska Airlines
 ALK.N , filed suit in the U.S. Fifth Circuit Court of Appeals
late Friday, according to a copy of the suit seen by Reuters. 
    This follows the issuance of USDOT's final rules last month,
requiring airlines and ticket agents to disclose service fees
alongside the airfare, saying it would help consumers avoid
unneeded or unexpected fees. 
    The airline group said in a statement on Monday the
department's rule would confuse consumers and its "attempt to
regulate private business operations in a thriving marketplace
is beyond its authority."
    USDOT said fees for baggage or flight changes "must be
individually disclosed the first time that fare and schedule
information is provided on the airline’s online platform -- and
cannot be displayed through a hyperlink."
    The rule requires airlines to inform consumers that seats
are guaranteed and that they are not required to pay extra.
Airlines must provide the following notice: "A seat is included
in your fare. You are not required to purchase a seat assignment
to travel."
    USDOT also said the rule will end "bait-and-switch tactics
some airlines use to disguise the true cost of discounted
flights." It prohibits airlines from advertising promotional
discounts off a "low base fare that does not include all
mandatory carrier-imposed fees."  
        The airlines' lawsuit calls the rule "arbitrary,
capricious, an abuse of discretion and otherwise contrary to
law." 
  
        USDOT did not immediately comment. The airline group
said the "rule is a bad solution in search of a problem."
  



 (Reporting by David Shepardson; Editing by Chizu Nomiyama and
Bernadette Baum)
 ((David.Shepardson@thomsonreuters.com; 2028988324;))