THE SUPREME COURT RULING IN NORTHWEST VS GINSBERG:
AIRLINES CAN CANCEL YOUR FREQUENT FLYER MILES AT WILL, ESPECIALLY IF YOU COMPLAIN. NOW IT'S UP TO CONGRESS, THE DOT AND US.
Consumer contracts, like airline contracts of carriage or frequent flyer programs, are known in the law as "contracts of adhesion" because one party (the corporation) writes the contract entirely in its favor and presents it to the other party (the consumer) on a take it or leave it basis.
Because such contracts are so one sided, most states have doctrines or statutes providing that, a) the parties cannot act in bad faith in carrying out the contract, and b) there is an implied covenant of good faith.
However, the April 2 nd decision by the US Supreme Court in the Ginsberg
case interprets the Airline Deregulation Act (ADA) of 1978 as wiping out virtually ALL passenger rights in state consumer contract law.
The Court unanimously ruled it's up the DOT (which has authority by regulation to prohibit "unfair" or "deceptive" airline practices" but not adjudicate individual claims) and the Congress (which enacted the preemption of state law clause) to provide frequent flyers with any rights or protection from unfair airline practices and decisions.
The frequent flyer contract in question said that the airline could change its frequent flyer program or eliminate any member's benefits "in its sole judgment".
Nearly all airlines have similar provisions.And under the Supreme Court decision that includes canceling miles and denying benefits to a passenger for making complaints, for no reason at all, or even to relieve it from providing promised benefits like air travel, upgrades or other perks to loyal customers.
The Airline Passenger Bill of Rights 2.0 proposed by FlyersRights.org in 2013 would restore and enhance airline passenger consumer rights under state and federal law, require reasonable notice of material changes in frequent flyer programs, and require airlines to report publicly basic data on the use of frequent flyer benefits, so passengers can compare airline programs and to eliminate deceptive and fraudulent practices.
The airline attorneys and some in the media sought to portray Rabbi Ginsberg, without a hearing on the facts or any proof, as an abuser of the airline's frequent flyer program.
Below is an excerpt of a recent article by Rabbi Ginsberg.
The courts refusal on technical legal grounds to hear or judge his case,
ruling Rabbi Ginsberg and all other frequent flyers mistreated by airlines have no rights as a matter of law, should not be the end of the matter. Now it is up to Congress and the DOT to correct this injustice and prevent future ones.
From I Won Because I Lost by Rabi S. B. Ginsberg, April, 2014:
The process of standing in front of the Supreme Court of the United States of America and awaiting their verdict was a once-in-a-lifetime encounter. It demands reflection and publication to share the messages that God so clearly set before me in order to teach me a lesson and help the greater world.
For years, my family and I had been traveling extensively on Northwest Airlines (now merged with Delta). As one news reporter stated, I spent more time in the air than on the ground. As a result, I earned the highest frequent flyer status and received hundreds of thousands of miles, granting me occasional free flights, special in-flight service and other privileges.
In 2008, due to alleged contract negotiations between Northwest and their baggage handlers, baggage arrival wait times became unusually long. Within a seven-month period, after waiting for hours to receive my luggage, I filed numerous complaints with the airline. I submitted these complaints by phone, cordially and respectfully, to Northwest's dedicated customer service representatives.
One day, out of the blue, a Northwest representative notified me that the airline had revoked my frequent flyer status and had erased nearly all my miles. I asked for my miles and privileges to be returned, but the airline refused, explaining that it had the right to revoke anyone's frequent flyer status for any reason it saw fit.
Annoyed that the airlines could do whatever they wanted to dedicated consumers when basic reasoning insisted otherwise, I filed a suit against Northwest for breach of the contract of frequent flyers and of the covenant of good faith and fairness between the consumer and the airline.
The district court heard my case and dismissed it on the basis of President Jimmy Carter's Airline Deregulation Act (ADA), which ceded to the airlines exclusive jurisdiction over price, route and service, barring government interference except in matters of security, traffic control, or civil business. The court ruled that revoking my frequent flyer status fell under the rubric of price and service and was thus in the airline's control.
I filed for appeal with the United States Court of Appeals for the Ninth Circuit, known for its consumer-friendly attitude and disdain for large, money-hungry corporations. The judges on two levels of the Appellate Court unanimously agreed to reverse the district court's decision, citing breach of good faith, and demanding that the district court actually hear the case. The ruling of the Ninth Circuit would have been a blow to the airlines. It would have revolutionized the relationship between airlines and customers in favor of the customers, requiring the airlines to spend money, time, and manpower enhancing their customer service.
Obviously unsatisfied with this ruling, Northwest appealed to the only court higher than the Ninth Circuit: the Supreme Court. Realizing the effect of the Ninth Circuit's ruling on the American people, the Supreme Court agreed to hear Northwest's case. Former Solicitor General Paul Clement represented Northwest Airlines, and the formidable Adina Rosenbaum, member of the Public Citizens Litigation Group, represented me.
A case heard by the Supreme Court consists of a lot of paperwork and a single hour of time in front of the judges, in which both sides explain their positions, present their documentation and answer numerous questions from all nine justices. After hearing the case, the Supreme Court can take between two and three months to reach a decision. They deliver their various verdicts on most Tuesdays and Wednesdays at 10:00 AM, with no advance warning to the parties involved.
Every Tuesday and Wednesday between the hearing in December and the announcement of the verdict, I wondered if the moment of my judgment had arrived.
On Tuesday, April 2, 2014, I was teaching a seminary class at 10:03 when my cell phone vibrated. It was my attorney, Ms. Rosenbaum. Though I usually do not interrupt lessons for personal calls, with the class's permission, I picked up the phone-and learned that the Supreme Court had unanimously decided to overturn the decision of the Ninth Circuit, ruling in favor of Northwest Airlines as per the ADA.
When I hung up, my students were shocked to see that I had no negative reaction, that I wasn't angry or frustrated or even sad. It was clear to me that the decision was God's Hand, that my life was orchestrated by Him for my benefit. With the past few decades of my life spent learning, teaching, and reviewing the words of a great rabbi and my teacher, it wasn't difficult for me to see that everything that happens to me is a result of my unique mission and serves as a springboard for my Service to God.
One tremendous lesson I learned was that one matter can be seen in two completely opposite lights, and that both can be correct! The experienced judges of the Ninth Circuit are often just one step away from the Supreme Court itself, yet they unanimously came to the opposite conclusion of the Supreme Court justices.
And, as trite as it sounds, don't believe everything you read. It is unfortunate to see the amount of negative press that followed me and my series of trials, the majority of which insults and accusations were based on faulty or missing information. For example, "Ginsberg lodged dozens of complaints in a seven-month period." The airline failed to mention that each complaint was lodged politely and calmly, after the airline requested feedback about their service. It also ignored the fact that in the years previous to this seven-month period, I had barely ever complained! Furthermore, it was rare to see a media outlet mention the dozens of positive comments and feedback that I sent the airline.
Paul Hudson, FlyersRights.org president, noted, "I am of the firm belief that if passengers who have been mistreated by airlines in frequent flyer programs now come forward in numbers, Congress and the DOT will take notice.
Reform of national policy often requires losing in the courts in an unjust decision, before Congress or the Executive Branch will take note.
I have seen this happen before.The federal appeals court decision in
Air Transport Assn. v Cuomo, overturning a New York statute outlawing tarmac confinements led to the DOT Three Hour Rule in 2009.
And the decision in Smith v Libya holding victims of state sponsored terrorism were barred from suing foreign states in US Courts led Congress in 1996 to amend the Foreign Sovereign Immunity Act to allow such cases (even making the new law retroactive to 1986). "Rabbi Ginsberg has done his part, now it is up to all of us frequent flyers.
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