Airlines Sue DOT Over New Fee Disclosure Rules

Airlines are reportedly suing the U.S. Transportation Department (DOT) over new fee rules.

The suit was filed in federal court last week by industry group Airlines for America, Reuters reported Monday (May 13). Joining in the suit were American Airlines, Delta Air Lines, United Airlines, JetBlue Airways, Hawaiian Airlines and Alaska Airlines.

The legal action followed the DOT’s release last month of rules that require airlines and ticket agents to disclose service fees along with the cost of airfare, saying it would help consumers skip unneeded or unanticipated fees. 

The suit countered that the DOT will only confuse consumers and its “attempt to regulate private business operations in a thriving marketplace is beyond its authority,” the report said.

A DOT spokesperson told PYMNTS the department would “vigorously defend” the rule.

“Many air travelers will be disappointed to learn the airline lobby is suing to stop these common-sense protections,” the spokesperson said.

The department last month also debuted a rule designed to make it easier for passengers to get refunds if a flight is canceled or “significantly” changed, or for those whose checked bags are “significantly” delayed or who did not get extra services as purchased.

“Passengers deserve to get their money back when an airline owes them — without headaches or haggling,” Transportation Secretary Pete Buttigieg said in a news release at the time. “Our new rule sets a new standard to require airlines to promptly provide cash refunds to their passengers.”

According to the new rule, a significant change to a flight includes things such as departure or arrival times that are more than three hours domestically and six hours internationally, or departures or arrivals from a different airport.

“The new mandate is set to transform the landscape of air travel, ensuring that passengers are no longer left in limbo when their travel plans are abruptly altered,” PYMNTS wrote in the wake of the DOT’s announcement. “After all, flight cancellations are enough of an inconvenience that customers shouldn’t also have to jump through hoops to be appropriately compensated for their troubles.”

That report stressed that disbursements stood at the center of the DOT’s new rule, at a moment when the business-to-consumer (B2C) payments landscape is being automated and digitized. 

Research by PYMNTS Intelligence shows that consumers want their money quickly when it comes to refunds or other disbursements. 

Data in the report “Merchant Refund Policies: Keeping Travel and Entertainment on Track” found that seamless, easy-to-use cancellation and refund policies are crucial to providing a positive customer experience.