The Comprehensive Guide to Canceled Mistake Fares
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You saw an excellent deal posted on TPG that featured an exceptionally low fare. You found dates that work and booked the trip immediately. So, imagine your disappointment when you get an email or phone call from the airline days or weeks later canceling your trip. It happens.
Although airlines are rarely forgiving of customers that make a mistake by booking incorrect travel dates or airports, they are allowed by a Department of Transportation ruling in 2015 to not honor so-called mistake fares. This guide covers what you need to know about canceled mistake fares, including your rights when a mistake fare is canceled.
Since most TPG readers are based in the US, the guide assumes your canceled mistake fare either originates in the US or has a destination within the US. Your rights will be different on mistake fares that don't touch the US or simply connect within the US.
What Are My Rights?
In 2012, the Department of Transportation (DOT) established clear rules in provision 399.88 against changing the price of a ticket after a customer paid the full agreed upon amount. For years, this meant that airlines had to honor mistake fares. However, after multiple mistake-fare disagreements between airlines and passengers, most notably the United-Danish Kroner case from February 2015, the DOT decided to specifically address mistake fares.
On May 8, 2015 the DOT issued a Mistaken Fare Policy Statement (pdf file) that provides background on their historical stance on mistake fares before laying out a new enforcement policy:
As a matter of prosecutorial discretion, the Enforcement Office will not enforce the requirement of section 399.88 with regard to mistaken fares occurring on or after the date of this notice so long as the air line or seller of air transportation: (1) demonstrates that the fare was a mistaken fare; and (2) reimburses all consumers who purchased a mistaken fare ticket for any reasonable, actual and verifiable out-of-pocket expenses that were made in reliance upon the ticket purchase, in addition to refunding the purchase price of the ticket.
When this new enforcement policy was announced in May 2015, the announcement said:
The enforcement policy outlined in this notice is temporary and will remain in effect only until the Department issues a final rule that specifically addresses mistaken fares.
However, three and a half years later we still haven't see a final rule addressing mistake fares.
What This Means
Airlines can cancel any fare if they can demonstrate that the fare is a mistaken fare. I'll discuss what is considered a mistaken fare in the next section, but generally this means that airlines can cancel any extremely low fare ticket if they claim the fare was a mistake. To make matters worse, there's no specified time window within which the airline must decide whether to cancel your ticket.
If an airline cancels your ticket, they must refund you the purchase price you paid. Plus, if you made any "reasonable, actual and verifiable out-of-pocket expenses that were made in reliance upon the ticket purchase" the airline must reimburse you these costs. The Mistaken Fare Policy Statement goes on to clarify:
These expenses include, but are not limited to, non-refundable hotel reservations, destination tour packages or activities, cancellation fees for non-refundable connecting air travel and visa or other international travel fees. The airline may ask the consumer requesting out-of-pocket expenses to provide evidence (i.e. receipts or proof of cancellations) of actual costs incurred by the consumer. In essence, the airline or seller of air transportation is required to make the consumer “whole” by restoring the consumer to the position he or she was in prior to the purchase of the mistaken fare.
So, if you made non-refundable plans for your trip between the time you booked the ticket and the time the airline canceled the ticket, the airline is required to reimburse you this cost.
What Is a Mistake Fare?
Perhaps the most troublesome part of the DOT's Mistaken Fare Policy Statement is the footnote provided after the requirement that an airline "demonstrates that the fare was a mistaken fare." This footnote says:
The burden rests with the airline or seller of air transportation to prove to the Enforcement Office that an advertised fare and the resulting ticket sales constitutes a mistaken fare situation. If a sale does not qualify as a mistaken fare situation, the carrier or other seller of air transportation is bound by provision 399.88.
Unfortunately, there's no definition of what a mistake fare entails nor how different a mistake fare should be from an airline's normal pricing. Instead, the definition and burden is left up to each airline. This means that the line between a mistake fare and a very good sale fare is fuzzy and potentially open to abuse by airlines that have second thoughts on a sale once bookings begin.
What Isn't a Mistake Fare?
As discussed in the previous section, the current DOT Mistaken Fare Policy Statement doesn't provide any definition for mistake fares. This makes it impossible to define what isn't a mistake fare.
However, airlines aren't going to call every cheap fare a mistake fare simply due to the time required to cancel fares and notify customers as well as the bad publicity that comes with the cancellations. For example, on Delta's recent canceled so-called mistake fares from New York JFK to Kenya and South Africa, readers reported that cancellation emails rolled in slowly across about 24 hours.
Although there's currently no solid guidance on what is and isn't a mistake fare, I generally don't worry about a fare being canceled as a mistake unless the fare seems too good to be true. As a loose metric, a fare that's more than 30-40% of what is common for that airline on that route usually won't be considered a mistake fare.
What Can I Do If My Ticket Is Canceled?
Your first step when an airline cancels a mistake fare is to contact the airline's customer service desk. Although it's unlikely the airline will reinstate the ticket, they may provide some goodwill miles or a voucher toward a future booking. Plus, the airline is required to refund the ticket purchase price within seven days of receiving a complete refund request for credit card purchases. Additionally, the airline should reimburse you any nonrefundable expenses that were made in reliance of the ticket purchase within a "reasonable period of time" once you've provided all necessary documents to the airline to justify the reimbursement.
Then, check your credit card statement frequently to ensure that the airline actually refunds you for the ticket price you paid and any non-refundable expenses. If they don't refund you — or you believe the airline has canceled a ticket that wasn't a mistake fare — it's time to file a complaint with the DOT.
How Do I Lodge a DOT Complaint?
If the airline refuses to provide a refund for the ticket or reimbursement for nonrefundable expenses — or you believe the airline has canceled a ticket that wasn't a mistake fare — you can file a complaint with the Aviation Consumer Protection Division of the DOT. You can file the complaint by phone or mail, but I'd recommend filing it online and taking screen shots as you go.
The DOT complaint form is relatively short. The first section asks for contact information and whether you want to receive a copy of the submission by email (you do).
The second section asks for the information surrounding your complaint. Be as specific as you can while describing your problem in 3,000 characters or fewer. Upload any relevant screenshots and copies of communication with the airline before submitting the complaint form.
Once you've submitted the form, the DOT website says the following will happen:
A Transportation Industry Analyst will forward your complaint to the airline and the airline will be required to provide you with a response. The analyst will ask the airline to provide a copy of the response to DOT only if it falls under one of the areas DOT enforces. The DOT analyst will then review the case to determine whether a violation occurred.
Are DOT Complaints Worthwhile?
My husband JT Genter and I have filed two DOT complaints since the 2015 DOT ruling, although only one of these complaints was related to a so-called mistake fare. As you'll see below, our experience has been underwhelming, but your mileage may vary.
Experience 1: On August 21, 2015 we purchased round-trip business class tickets on American Airlines from Austin (AUS) to Rio de Janeiro (GIG) for about $466 each. American waited until September 4th to cancel these tickets, so we filed a DOT complaint on October 2. We received a response from the DOT on October 6 saying they forwarded the complaint to American and on October 19 the DOT responded saying that American had responded showing it was a mistake fare. American Airlines never did fulfill its requirement of fully refunding the fare within seven days, so we filed another complaint on December 3. Although no response was ever received from the DOT, a full refund was issued by the airline shortly later.
Experience 2: Avianca didn't honor their stated 24-hour cancellation policy for a round-trip business ticket JT booked in December 2017 from New York (JFK) to Medellín (MDE) — which he ended up reviewing on a different date. When the airline only refunded the taxes ($135) and not the airfare ($566), he filed a DOT complaint on January 9, 2018. The DOT responded on January 12 saying they forwarded the complaint to the airline. On January 22 Avianca responded to JT copying the DOT, but the response wasn't adequate or reasonable. JT responded to DOT on January 22 and followed up repeatedly over the following weeks with no response. On February 12 he responded to Avianca and copied the DOT. He followed up again on March 29 and a DOT agent finally responded saying she needed to look at the airline's response. The DOT never responded or resolved the case. JT filed a credit card dispute for the fare. American Express promptly credited his The Platinum Card® from American Express account and investigated. The credit was made final 41 days later.
As you can see from these experiences, the DOT usually forwards the complaint to the airline quickly. But then the airline can take up to 60 days to respond. The DOT's Consumer Complaint webpage says the "DOT requires airlines to acknowledge consumer complaints within 30 days of receiving them and to send consumers written responses addressing these complaints within 60 days of receiving them."
If you don't like the response from the airline, you can rebut it with the DOT agent assigned to the case. But, as can be seen in the relatively straightforward Avianca 24-hour cancellation case described above, this rebuttal isn't likely to be successful even if the facts are clearly in your favor.
DOT complaints are slow, frustrating and frankly unlikely to be successful. You're unlikely to get a canceled fare honored through this process, you're unlikely to convince the DOT that a canceled fare isn't a mistake fare and you'll probably struggle to even get a fare refunded if the airline doesn't want to.
However, filing a DOT claim won't hurt and it could help shape future regulations. The DOT's website says:
Complaints from consumers help DOT spot problem areas and trends in the airline industry. Complaints can lead to enforcement action against an airline when a serious violation of the law has occurred. Complaints may also be the basis for rulemaking actions.
So, if you're unhappy with the current regulations and guidance regarding mistake fares, filing a DOT complaint is the right thing to voice your opinion.
What Other Recourse Do I Have?
As TPG contributor Mitch Berman discuses in Five Legal Remedies for When Your Flight Deal is Canceled, you have two other sources of recourse:
- File a credit card dispute for the airfare charge with your credit card company
- File a claim in small claims court
If the airline has canceled your fare but isn't refunding you, you can and should file a credit card dispute for the airfare charge. You can do this in parallel with requesting a refund from the airline, as the credit card company will fix their credit if they see the airline refunds you. But don't wait too long, as some credit cards require you to dispute charges soon after they occur.
Small claims court is also an option, but it should be your last resort. If you end up going this route, you might be able to represent yourself. But make sure to do your research to determine the rules, fees and required forms for your jurisdiction and don’t ask for more than your court’s award limit.
Having a so-called mistake fare be canceled is frustrating. Airlines should be forced to implement checks to prevent these fares from being available for purchase, but a Department of Transportation ruling in 2015 instead allows airlines to not honor these fares if they can prove the fares are "mistaken."
So, when you see a jaw-dropping fare deal, book quickly but keep your expectations tempered. Sometimes these deals are honored, so I still spend the time to chase and book them. But, if the airline cancels your fare and the ticket's origin or destination is within the US, the airline is required to refund the purchase price of the flight and reimburse any nonrefundable expenses that were made in reliance on the ticket purchase. If the airline refuses — or you believe the airline has canceled a ticket that wasn't a mistake fare — you can file a complaint with DOT and/or a credit card dispute with your credit card for the airfare.