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American Airlines Took Back 1 Million Miles From a California Couple. They’re Organizing a Class Action Lawsuit

Should the suit be certified for a class action, it would be designed to seek relief for AAdvantage members. 

ACalifornia couple is suing American Airlines, alleging that the airline canceled their mileage accounts for violating rules they weren’t violating. 

Ari and Shanna Nachison have filed suit against American in a federal court in San Jose, California, proposing a class action against the carrier, to be joined by other mileage members who have been similarly wronged. The couple says American canceled over one million miles accrued between their two accounts, saying that they violated the terms of the carrier’s program by fraudulently getting bonuses for opening multiple credit card accounts. 

The couple disagrees, saying that some credit card accounts that earn American’s AAdvantage miles carry restrictions on opening multiple accounts in a 48-month period, they were careful to avoid the cards with those restrictions. Each received e-mails from American in early 2020, saying their accounts were canceled and their accrued miles forfeited related to the accrual of ineligible miles and benefits; through fraud, misrepresentation and/or abuse of the AAdvantage Program.”

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The couple further allege that any statute of limitations on filing their suit would not apply because the lack of specifics in their received notices delayed them from pursuing legal relief. Should the suit be certified for a class action, it would be designed to seek relief for AAdvantage members who had their accounts canceled for similar reasons. 

A copy of the AAdvantage program rules at the time of the account termination could not be found, but airlines generally have language in the terms and conditions of their mileage programs that fraud, misrepresentation or any attempts to “game” the system to earn more mileage can lead to account suspension or termination, and forfeiture of all miles—even those that were legitimately accrued. 

The current terms and conditions of the AAdvantage program contain language preventing members from attempting to create a class action suit, saying that all disputes will be resolved on an individual basis. It’s unclear whether this language existed in the program rules at the time of the account cancellations. 

Airline miles do not have an official cash value, but the frequent flier website The Points Guy values AAdvantage miles at 1.5 cents each when used for flights, making the estimated cash value of the canceled accounts just over $16,700. 

Airlines frequently tweak their frequent flier programs, changing earning and redemption levels, elite status earning requirements and benefits, and award redemption options. American recently announced some benefits previously afforded to all passengers would only be available moving forward to members of the AAdvantage program.

It doesn’t always go smoothly. Changes that Delta Air Lines proposed in late 2023 were rolled back after members revolted.

Frequent program changes—particularly the devaluation of points and miles—have earned the industry attention from the U.S. Department of Transportation, which last month announced it has been reviewing the airlines’ programs for unfair and deceptive practices.  Senators Richard Durbin and Roger Marshall asked the DOT to investigate the programs in October 2023, writing, “In practical terms, it means airlines can make changes to their points programs without notice to consumers, as long as the programs’ terms of service reserve the right to do so. As a result, these programs incentivize consumers to purchase goods and services, obtain credit cards, and spend on those credit cards in exchange for promised rewards—all while retaining the power to strip consumers of those rewards at any moment.”

Frequent flier program members should periodically review the terms and conditions of any program they participate in and airline representatives to seek clarification. Program members should also periodically give feedback on program changes they disagree with—particularly after Delta members ultimately demonstrated such feedback was ultimately effective.

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thursdaysd February 4, 2024

Certainly sounds like they were gaming the system.