Legally SWISS

Blogger’s note: I just reread this before publishing, and I think I may have just written 2200+ words while literally saying nothing at all. That may be a new record for me… but at least I’m warning you up front that you may get nothing (except boredom) out of this post. Read on at your own risk.

I swear this blog isn’t going to become all-SWISS all the time, but I did want to write a post about the recent first class award availability issue and subsequent fallout. To bring you up to speed, SWISS generally doesn’t make award space in their drool-worthy first class cabin available to partner loyalty programs. That kinda sucks, given that this is what you’re missing out on:

Given that policy, people were understandably excited when a bunch of SWISS first class space showed up across multiple Star Alliance programs one morning a couple months ago. I saw the news on my phone right when I woke up and rushed over to my computer to try to book the return leg of our upcoming trip via Zurich, but by the time I got there, it was already snapped up (or turned back off by SWISS).

My inability to wake up at a decent hour ended up saving me a huge headache, though, since I would have quickly canceled my BA booking if I had managed to book the flights I wanted on SWISS, leaving me no good options if the SWISS tickets didn’t pan out. Lo and behold, SWISS up and canceled every ticket booked through Aeroplan (the obvious program of choice given that it’s only 70,000 miles with no fuel surcharges, compared to 110,000 through United), saying that it was a mistake in the first place. If I had booked one of those tickets, I would have been livid, regardless of whether or not they were in the right.

So that brings us to now, where the situation is still being litigated both in public and in blog comment sections all the way from BoardingArea to, uhh… Saverocity? (I don’t know if anyone on Saverocity has written about it, but that’s the other blog network that came to mind.) I’m curious about it, and unlike a lot of posts where I have a very strong opinion that I want to profanely rant about (like how you shouldn’t fucking split goddamn infinitives), I’m more interested in asking questions. At first, I felt like SWISS was obviously in the wrong, and that everyone had a legitimate grievance against them. Now I’m not so sure.

I should also add that one of the main things keeping the discussion going is Matthew Klint’s crusade for justice being documented over at Live and Let’s Fly. Klint’s argument is that Aeroplan promised him first class direct travel on SWISS, so that’s what they owe him… and he bought a first class revenue ticket as a way to establish the damages he feels he is owed. However you feel about his gambit to hold SWISS and Aeroplan accountable, I at least think it’s valuable to have people out there willing to push the limits of frequent flyer programs to their absolute extreme… otherwise we’d never know exactly where those limits were. (I liken it to Vihn over at Miles Per Day basically daring banks to shut him down, although nowadays it mostly seems like his readers are the ones getting shut down.) It’s the points and miles equivalent of the entomologist who subjected himself to thousands of stings from a wide array of insects as a way to document the pain spectrum of those stings. Just like suing SWISS/Aeroplan over a canceled award ticket, I’d never do it, although it’s interesting to read about.

Thing is, I can’t imagine him succeeding. But then again, I couldn’t imagine Trump becoming president, so what do I know. Unfortunately we probably won’t get much of a  satisfying resolution, since the most likely option is some sort of confidential settlement. But looking at the original issue, there are a few key areas that any case would depend on, and I hope someone with more legal knowledge than me (so, any legal knowledge at all) will weigh in in the comments. Klint has picked up a fair amount of hate from various corners of the blogosphere, but I’m more interested in digging into the actual issues than giving my opinion on what he’s doing.

Key issue #1: Is Aeroplan award travel not permitted on SWISS first class? Does it matter?

Aeroplan’s award chart says that “SWISS First Class is not available for reward travel.” Most of the haters are using this as a smoking gun that proves Klint is delusional. The argument is that Aeroplan tells you that you can’t book SWISS first class, so any award space is clearly a mistake, and you should have known better, and also you suck. And sure, an airline can cancel a ticket issued by mistake, but that has always been interpreted to mean a mistake in the price. In this case, the ticket was issued at the publicly published price, so the mistake was that the ticket was available at all. That doesn’t have an obvious corollary in the world of revenue tickets, which makes it a tough problem to evaluate based on past precedent.

To me (and to many others), it didn’t seem like an obvious mistake, and I was surprised when I read that tickets were being canceled. First, SWISS has released first class award space to Aeroplan in the past, and they honored those tickets. So there is some past precedent that award space sometimes becomes available, and that those tickets are honored. Second, the Aeroplan chart doesn’t say that SWISS first class awards are not permitted, it says they aren’t available. That opens up a lot of ambiguity, because when you log into their site and book a ticket, you never look at the award chart. You see the flights that are available, the price, and you book them. At best, Aeroplan is presenting contradictory information by saying on one page that something isn’t available while literally making it available on another page.

So that’s question-for-a-lawyer #1: is it correct to conflate “not permitted” and “not available”? (The use of the phrase “not permitted” is important, because that’s the wording SWISS used in their incredibly disingenuous (and demonstrably false) explanatory email for why they canceled the tickets.) For a discipline that hinges so much on the definitions of individual terms, you’d think the difference between “not permitted” and “not available” would matter, so I feel like a good lawyer wouldn’t let SWISS get away with this conflation.

Question-for-a-lawyer #2 is whether any of this matters. Section 7.1.1 of SWISS’s Conditions of Carriage basically says they can do whatever they want for any reason: “We may, through reasonable exercise of our discretion, refuse to carry you or your Baggage if we have given you written notice in advance that we will not carry you on our flights after a particular date. In such cases you will be entitled to a refund.” Basically, if they tell you that they don’t want to honor your flight, then they don’t have to honor their flight. Honestly, I assumed they had some sort of “we can fuck you over for any reason or for no reason at all” clause somewhere in there, but this is even more open-ended than what I was expecting.

Say for discussion’s sake that this was actually a mistake, and that SWISS didn’t intend to change their normal policy of not allowing partner award bookings in first class. Wouldn’t reverting to their (vaguely) documented policy be considered a reasonable exercise of their discretion? And just because they allowed this a handful of times in the past doesn’t mean that they’re obligated to continue to allow it forever onward into infinity.

Key Issue #2: How significant is it that this only applies to Aeroplan?

I’m assuming that the vast majority of bookings were made through Aeroplan, because it’s significantly cheaper. However, some people did book through United, and reports so far are that those tickets weren’t canceled. What’s different between United and Aeroplan besides the “not available” verbiage on Aeroplan’s award chart? It sure seems to me like SWISS is standing by that one line of text and using it as a get out of jail free card to avoid having to give out first class seats Oprah-style.

The inconsistency there seems problematic, since for one reason or another, SWISS is acting like they have leeway with Aeroplan bookings that they don’t with United. Question-for-a-lawyer #3 is whether SWISS honoring United tickets contradicts the broader reason for cancelation outlined in 7.1.1 (since it’s arguably not a reasonable exercise of discretion to cancel tickets booked through one Star Alliance partner but not through another). If that’s the case, then SWISS’s only leg to stand on is the whole available vs. permitted thing. If I were the plaintiff here, I’d be much more confident defending that available and permitted are two different things than having to argue around their incredibly broad self-granted rights to refuse carriage.

Key Issue #3: How do you assess damages? And who do you sue?

I kind of feel bad for Aeroplan here, since I absolutely don’t buy SWISS’s bullshit contention that Aeroplan issued the tickets as a rogue actor (since United also issued the same tickets). The inventory popped up in their reservation software, they issued the tickets, SWISS canceled them unilaterally, and Aeroplan was left holding the bag with their customers. For legal purposes, Aeroplan is the entity that sold the ticket, so they’re the ones who you’d sue if you were going to sue someone.

That’s problematic, though, since I don’t really know if you can argue that Aeroplan did anything wrong. To wit, section 24 of their Terms and Conditions for award tickets: “All flight reward bookings, including routing validations, are subject to approval by Aeroplan and/or the Partner Airlines on the itinerary and may change with or without prior notice.” Question-for-a-lawyer #4 is if that’s as damning for any legal action against Aeroplan as I think it is. To me, it seems pretty cut-and-dried: the partner airline didn’t approve the booking, so it gets canceled. Regardless of whether the award should or shouldn’t have been available, Aeroplan gives themselves the right to cancel a ticket if the other airline doesn’t approve it. I don’t know how you could realistically bring a case against them at that point.

However, the mention of the partner airline having responsibility over whether the ticket is honored would seem to give the plaintiff standing to sue SWISS themselves, since they’re the ones who may have acted in bad faith by not approving the booking. (I suppose question-for-a-lawyer #5 would be to ask if that’s true or not.) I should note that it doesn’t sound like Klint is moving in that direction with his action, although I don’t know any more than what he has put up on his blog so far.

That leads us to the question of damages, and I think here is where Klint lost a lot of people. His argument is that the damages he suffered by either Aeroplan or SWISS acting in bad faith is the cost of a revenue ticket, which he then bought using all that sweet, sweet blog revenue (I kid). This reminds of a chapter from Priceless, a great book about how consumers perceive prices for goods and how companies manipulate those perceptions. One of the chapters is about legal damages, and the big example is the McDonald’s hot coffee incident, in which the damages awarded were equal to one day of McDonald’s revenue from coffee sales. The jury felt this was fair – a person was burned and disfigured, so it’s only fair that McDonald’s give up a day’s worth of revenue. But why a day? Why not an hour or a week? The reason is that the lawyer wanted to come up with a big number that would be grounded in something that intuitively made sense to the jury. The justification of the number is irrelevant, though – it was arbitrary all along.

The same issue is at play here: you could argue as Klint does that the damages were equal to the cost of the flight that wasn’t honored, but you could also argue that the damages were equal to the price difference between an alternative (business class) flight and a first class flight. Also, the price of a flight fluctuates all the time. If you bought the flight at the airport two hours beforehand, it would presumably be more expensive than if you bought it far in advance of your date of travel. Should the damages be equal to the most expensive the flight has ever cost in the last year (or two years or ten years)? The flight cost 70,000 Aeroplan miles, so it could also be argued that the damages should be equal to the monetary value of those Aeroplan miles, but then you’d have to figure that out.

In the end, the fact that this is such an ambiguous mess would probably convince me just to slink away and lick my wounds until another good redemption opportunity came along. You win some you lose some in this hobby, even if some of those losses are harder to swallow than others. There are just too many variables to mount a credible legal case, and the more I think about it, the less of a slam dunk it seems in my mind. I believe that SWISS is 100% in the wrong for canceling the tickets, but I don’t think that carries over into a legal sense. I just think it was a dick move on their part… and unfortunately you can’t sue over that. (Question-for-a-lawyer #6: can you???)

So what does everyone else think? Any lawyers want to answer some of my questions? All in all, this is a really interesting situation to me, and I’m interested to see how it plays out with any claims people make against either airline.

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