Delta Fined $100,000 For Lying To Passengers About Lost Luggage Liability

According to federal regulations, airlines “shall not limit its liability for provable direct or consequential damages” to less than $3,300 per passenger. Someone should have told that to Delta, which was recently slapped with a $100,000 fine by the Dept. of Transportation for distributing pamphlets telling customers something very different.

Last October, the DOT’s Enforcement Office sent out an advisory notice to carriers warning them that they would pursue any airlines who didn’t correct their unlawful reimbursement policies withing 90 days. Someone at Delta apparently missed the memo.

From the DOT’s statement on the Delta fines:

For a period of time well after January 2010, Delta distributed a pamphlet to consumers through select airport stations entitled Baggage Information that purported to limit Delta’s liability for passenger expenses incurred due to delay of baggage to a level below the minimum set in Part 254. The pamphlet stated that Delta “will not authorize any expense reimbursement” when a passenger’s delayed baggage is expected to reach the passenger within 24 hours. The pamphlet also stated that the carrier’s liability is capped at “USD 25 per day for necessities after the first 24 hours up to a maximum of USD 125 per ticketed customer” while a passenger is away from his or her permanent residence. The Enforcement Office believes that passengers who read the pamphlet may have been dissuaded from seeking reimbursement to which they were entitled. Moreover, in a number of instances in which passengers whose bags were delayed sought reimbursement, Delta applied the exclusions and limitations set forth in the pamphlet.

The Enforcement Office concluded that Delta “engaged in unfair and deceptive trade practices and unfair methods of competition” by distributing these misleading pamphlets.

According to travel writer Chris Elliott, Delta’s explanation for the screw-up is that some airport stations were remiss in destroying outdated brochures:

Delta asserts that it had updated its baggage policy disclosures in its relevant informational pamphlets, distributed them to the field, and instructed all stations to substitute the new pamphlets by the January deadline established by the Department’s guidance on this subject.

Delta further instructed its stations to destroy the outdated pamphlets. Delta states that any distribution of outdated pamphlets or application of a flat per diem cap in the processing of a baggage claim violated Delta policy, and affected only a tiny fraction of the millions of passengers served by Delta.

Delta fined $100,000 for misleading baggage brochure [Elliott.org]

Comments

Edit Your Comment

  1. StuffThingsObjects says:

    I’m glad they were fined so litte, as I’m sure every other reader is.

  2. EmanNeercs says:

    Wow, I’m sure a fine like that really taught Delta a lesson, they’ll definitely be more wary next time around…

  3. Loias supports harsher punishments against corporations says:

    “didn’t correct their unlaqful reimbursement…” eh? I had to chuckle.

  4. TinaBringMeTheAx says:

    But are they taking it very seriously?

  5. Ephraim says:

    Simple… not enough. It should be a number so large as to actually make them think twice about it. Something in the range of the cost of an airplane… at least.

    • Loias supports harsher punishments against corporations says:

      I don’t understand why we don’t punish companies and individuals in the sense that you need to repay what you gained PLUS pay a penalty.

      In other words, a reasonable estimate should be determined of what Delta gained monetarily from this practice, and that should be the minimum fine. Beyond that, a penalty fine should also be determined based on the circumstances of the infraction.

      It should never pay to break the law.

      • econobiker says:

        Just like those corporate “pay a fine but don’t admit liability” settlements too?

      • Scuba Steve says:

        Because if it was just a matter of “Give the money back, no harm no foul”, it would be in everyone’s best interest to try and screw others as much as possible.

        Granted, Corporations already act like this, but Penalties should be levied to dissuade Delta and other Airlines from trying it in the future.

        $100,000 might not be enough to dissuade them. Then again, maybe it would be.

        • Scuba Steve says:

          Ah just ignore what I wrote, next time I’ll be sure to double check your comment before I start my diatribe.

    • dg says:

      I agree, it should be $100,000 per person that was lied to or misled. And that money should go 50/50 to the person lied to and the Government, with Delta paying the taxes due on it. Until it’s on the company’s radar screen (no pun intended), they’re going to consider it a cost of doing business. It needs to be of such a level that it can cost them dearly and put them out of business. Then, and only then, will they take it seriously.

  6. stevenpdx says:

    I hate those unlaqful reimbursement policies.

  7. Holybalheadedchrist! says:

    Why can’t we do when our forefathers caught the airlines lying? Take this country back, sheeple!

  8. HogwartsProfessor says:

    Those cookies taste awful. I call them “puppy biscuits.” My bad for not packing my own food the last (and so far the only) time I flew Delta.

  9. kmw2 says:

    So if they screwed more than 30 customers out of their maximum compensation, Delta actually made a profit on this deal. Who wants to take odds on Delta screwing more than 30 customers on any particular thing?

  10. dolemite says:

    I’m sure they saved millions while having to pay a measly 100k.

  11. sopmodm14 says:

    it doesn’t matter what they assert

    they still gave out reimbursements according to their own policies, INSTEAD of federal regulations

  12. antifox says:

    unless it’s an emergency try to fly with no checked luggage the fee they charge is tax free so pure profit and as long as they appeal they don’t have to pay a fine can go on for years. Delta and lawyers make pure profit. I will not pay for checked luggage I will send fed ex/ups/postal pay more but NOT TO THEM.

  13. mcross says:

    Delta also seems to want to challenge United for the title of the airline that breaks guitars, or most anything. On a recent flight to LA, we had to change planes in Minneapolis. I watched out the window as Delta baggage man-handlers threw suitcases off a cart onto the apron, with considerable force.Some luggage actually bounced in the air from the abuse. It was no surprise to find my bag had scuff marks, but fortunately there was nothing broken inside. What fun to fly these days!

  14. sonneillon says:

    Well I like hating on Delta with a fury that could be considered religious, and I like math well enough.

    Delta had about 25k in baggage claims in 2009. 5/6 of that is about 21k

    “The Department of Transportation claims that 80% of the mishandled bags are reunited with their owner within 24 hours and 99% are returned within 5 days. Only 1% are lost forever.”

    so of the 21k only 210 are going to be able to max out. So the 210 are going to go at 3300-125=3175*210=667k

    667k-100k=567k that Delta is ahead on this deal. Good deal for them unless all passengers who have lost bags with delta take them to small claims court and opt out of any proposed class action settlement, then it would cost them millions.

  15. MistahFixit says:

    I wouldn’t feed those to a dog, and I don’t even like dogs! :(

  16. profmonster says:

    Heh, I do love the weasel-speak:

    “Delta asserts that it had updated its [unlawful, fraudulent] baggage policy disclosures…Delta further instructed its stations to destroy the outdated [read: misleading, fraudulent] pamphlets.”

    fraudulent=outdated

  17. palfas says:

    OMG F’ing big government regulations are choking the airlines. Let the free market work. If your bag gets destroyed, then use another airline. Eventually, the bad airlines will go out of business…right?!?

  18. Telekinesis123 says:

    This is actually massive pre-meditated and well thought out fraud Delta Airlines. I’ll be sure to remember this and I hope you do to.