Lufthansa Wins Lawsuit Against Travel Site For Publishing 'Error Fares'
A German court recently ruled in favor of Lufthansa after the airline pursued a lawsuit against Germany-based travel blog HolidayPirates for advertising business-class "Error Fares" between Germany and California for just 687 euros ($819).
The error fares, published on HolidayPirates on September 1, 2017, knocked more than €3,000 ($3,577) off the going rate on the fare, and could be booked from the travel site via a Kayak plug-in. The court called the published fare and search functionality an "unfair trade practice," particularly in an antitrust context, since the HolidayPirates website could be considered a competitor selling travel services, according to Loyalty Lobby.
The ruling, by a local court in the state of Bavaria, poses some puzzling questions for travel sites hoping to share future good deals with their readers. While this particular German court sanctioned the promotion of "fares with wrong prices" (i.e. error fares), it isn't clear if that is meant literally as only error fares, or if it applies to any mention of "great deals" or even the equivalent of the Deal Alerts we publish here at TPG. The court also didn't specify whether or not the ruling is limited to HolidayPirates alone, or if it extends to other websites and airlines. Regardless, the threat of jail time and/or a €250,000 fine makes the idea of testing those boundaries very unappealing.
The court document can be found here (in German only). The case, which was filed soon after the error fares were published in September 2017, states that Lufthansa immediately took action on the error, yet the HolidayPirates publication caused the airline to incur a total loss of €450,000 ($536,638) on the published business-class fares. Beyond the financial loss, however, Lufthansa claimed that its primary concern was the damage done to public perception and value of the airline brand. (The carrier blamed an "incomplete Excel spreadsheet" for the pricing error on its booking site.)
The ruling imposes a fine of €250,000 or six months' jail time for the CEO. It can be appealed in a higher court in Bavaria.
H/T: Loyalty Lobby
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