United Airlines Sued Over Refund Policy Amid COVID-19

By Lauren Berg
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Law360 (April 6, 2020, 4:42 PM EDT) -- As airlines slash flight schedules in an effort to stop the spread of the deadly coronavirus pandemic, United Airlines Inc. violated consumer protection laws by refusing to refund passengers for canceled flights, according to a proposed class action filed Monday in Chicago federal court.

United has refused to issue refunds to passengers after canceling thousands of flights to help prevent the spread of the novel coronavirus, according to a complaint filed by Jacob Rudolph that alleges the airline violated the Illinois Consumer Fraud and Deceptive Business Practices Act and consumer protection laws for 49 separate states.

Instead, United will only rebook or provide travel vouchers that expire within a year of the original ticket date, Rudolph said. But that's not good enough, according to the complaint, because all airline passengers are entitled to a ticket refund if their flight is canceled, regardless of what reason the airline gives.

"The need for monetary refunds over travel vouchers is pressing now," Rudolph said. "Travel vouchers provide little security in this public crisis, particularly where many individual Americans need money now to pay for basics like food and rent, not restrictive, temporary credits towards future travel."

The $2 trillion Coronavirus Aid, Relief and Economic Security, or CARES, Act is set to provide a $58 billion bailout to airline companies, but despite this "faucet of taxpayer money that will flow its way," United refuses to comply with the law or act in the interests of its customers, Rudolph said.

In January, Rudolph said he bought three tickets from United for a flight on April 4 from Hilton Head Island, South Carolina, to Minneapolis-St. Paul, Minnesota, with a connecting flight in Chicago. Rudolph said he spent more than $1,500 on the tickets, but United ultimately canceled the flight.

On March 16, Rudolph submitted a written request for a refund, but United denied the request, saying his ticket purchases don't qualify for a refund, according to the complaint. Instead, on March 31, United told Rudolph that he could either rebook the flight or get travel vouchers that would expire within a year, according to the complaint.

At the time that he bought the tickets, Rudolph said, he understood he would be entitled to a refund if his flight was canceled, but that he was deceived by the airline.

Rudolph's suit includes claims of violation of the Illinois Consumer Fraud and Deceptive Business Practices Act, violation of consumer protection acts in 49 separate states, unjust enrichment, conversion and fraudulent misrepresentation.

The suit seeks unrefunded money as well as actual, statutory and punitive damages.

"Now is not the time for United to change its promises and deprive customers of a refund, even the more so as United has benefited from a generous government bailout," Rudolph's attorney, Steve W. Berman of Hagens Berman Sobol Shapiro LLP, told Law360 Monday.

A representative for United declined to comment Monday, saying the airline hasn't yet been served with the lawsuit. But the airline has implemented new policies in the wake of the coronavirus pandemic to allow customers to change their travel plans without a fee, including rebooking trips or requesting a travel certificate to choose a flight in the future, the representative told Law360.

Passengers on domestic flights and customers with international tickets can also request a refund if their flights have been "severely adjusted or service to their destination suspended" due to government mandates or United schedule reductions due to coronavirus concerns, according to the representative.

The airline isn't the only business to be hit with a lawsuit over its refusal to refund ticket prices.

Last week, StubHub Inc. was hit with a proposed class action accusing it of reneging on its guarantee to provide cash refunds to customers as many are seeking to get their money back for the thousands of events canceled due to the COVID-19 pandemic.

Rudolph is represented by Steve W. Berman, Daniel J. Kurowski and Whitney K. Siehl of Hagens Berman Sobol Shapiro LLP.

Counsel information for United was not immediately available.

The case is Jacob Rudolph v. United Airlines Holdings Inc. et al., case number 1:20-cv-02142, in U.S. District Court for the Northern District of Illinois.

--Additional reporting by Stephen Cooper and Zachary Zagger. Editing by Alanna Weissman.

For a reprint of this article, please contact reprints@law360.com.

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Case Information

Case Title

Rudolph v. United Airlines Holdings, Inc. et al


Case Number

1:20-cv-02142

Court

Illinois Northern

Nature of Suit

370(Other Fraud)

Judge

Honorable Thomas M. Durkin

Date Filed

April 06, 2020

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