United Rips Customers' Info Grab In COVID-19 Refund Action

By Linda Chiem
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Law360 (March 22, 2021, 6:27 PM EDT) -- United Airlines asked an Illinois federal judge Monday to snuff "extraordinarily broad" discovery requests in a proposed consolidated class action over refunds for COVID-19-related flight cancellations, saying two consumers leading the case shouldn't be allowed to advance their claims anyway since they've already received their refunds.

The Chicago-based carrier told U.S. District Judge Thomas Durkin that lead plaintiffs Mark Hansen and Jason Buffer have saddled United with sweeping discovery requests that are unusually burdensome and costly. Moreover, United has separately moved to have the class allegations stricken from the case — on grounds that Hansen and Buffer have already received refunds for certain legs of the canceled flights that prompted them to sue in the first place — so discovery should be paused in the meantime, United contended in Monday's motion.

"If granted, United's motion to strike will, at a minimum, dramatically impact the permissible scope of discovery in this case by limiting discovery to information relevant to the specific claims of the two named plaintiffs, Mark Hansen and Jason Buffer," United said. "Indeed, given that Hansen and Buffer have already received full refunds, striking the class allegations should dispose of this action entirely."

United said the consumers have asked it to "produce all documents created, received or sent since October 1, 2019, regarding any questions, complaints or grievances received from [United's] customers relating to [United's] failure to give customers a refund for a flight canceled and/or significantly delayed by [United] as a result of the coronavirus pandemic including, but not limited to, legal complaints, complaints to customer service, and/or complaints to or from regulatory agencies, your responses thereto, and internal documents regarding any such questions, complaints or grievances."

The consumers also asked United to hand over "all documents created, received or sent at any time regarding any analysis of the advantages and/or drawbacks to [United] and/or [United's] customers based on providing a credit or voucher rather than a refund for flights canceled and/or significantly delayed as result of the coronavirus pandemic."

"United should not be required to incur the substantial burden and expense of responding to plaintiffs' extraordinarily broad and onerous requests prior to a ruling on the motion to strike class allegations, which if granted will [at a minimum] 'greatly affect the course and scope of discovery' in this case," the airline said.

United also said its attorneys conferred via email with plaintiffs' counsel regarding the requested stay of discovery, and the "plaintiffs oppose the requested relief and have stated that they intend to oppose this motion."

Attorneys for the consumers were not immediately available for comment Monday.

United moved to eliminate the class claims in a separate motion on March 12, saying the litigation requires "multiple individual, fact-intensive liability determinations as to each class member." For example, the court would have to parse through which customers actually requested refunds, whether their flights were canceled due to a schedule change or irregular operations, or whether the customers have already been compensated for the canceled flight through other means, such as by successfully disputing the credit card charge or receiving a travel insurance settlement, according to United.

This comes after Judge Durkin in February denied United's motion to dismiss the case outright. The judge said the airline can't use a force majeure clause in its contracts to entirely evade claims it improperly denied passengers full refunds for flights that were canceled amid the pandemic.

The judge said not all of the passengers' canceled flights qualified as a force majeure event in its contract of carriage that would free United from having to give them refunds. United has said it was only obligated to extend a travel credit to affected passengers, which it did.

According to the airline, force majeure events refer to unique occurrences that either physically prohibit United from operating flights — acts of God, governmental regulations, strikes and damaged aircraft, among other things — or prohibit United from operating flights because doing so would expose passengers to a substantial risk of bodily harm — "riots, terrorist activities, civil commotions, embargoes, wars, hostilities, disturbances or unsettled international conditions" — or present an "emergency situation requiring immediate care or protection for a person or property."

If United cancels a flight due to a force majeure event, ticketed passengers are entitled to a travel credit, but no refund. But if a cancellation is due to a schedule change or irregular operations — and affected passengers are not rebooked on another flight within the contractually required time frame — then United must issue a refund "upon request."

Judge Durkin declined to embrace United's broad interpretation of a force majeure event, saying it could mean that any change that was unforeseen or beyond United's control would disqualify affected passengers from receiving refunds.

Buffer bought two roundtrip tickets from United for travel on March 19, 2020, from New York to Greece via Frankfurt, Germany. At least one leg of his flight was canceled due to the pandemic, so he was offered flight credits on United, which he declined stating he wanted a refund, which United then denied.

In Buffer's situation, the judge said it is plausible that United canceled Buffer's flights "because of a desire to save on operating expenses," as the complaint alleges, and not because COVID-19 had been declared at that time as a public health emergency and global pandemic. At that time, United publicly stated it was making "adjustments" to its flight schedule due to "reduced demand," according to the ruling.

"United does not contend that economic motivations constitute a force majeure event, and nor could it," Judge Durkin explained. "Ultimately, whether the cancellations at issue occurred because of economic considerations, or were due to restrictions and warnings related to the pandemic, can only be answered with discovery."

Judge Durkin denied United's bid to force Hansen to arbitrate his claims just because he bought his tickets from online travel agency Expedia, instead of directly from United.

However, he agreed with United that Hansen might not have a plausible breach of contract claim for at least part of the trip he booked to travel from Vancouver, British Columbia, with a connection in Houston, to Costa Rica on March 28, 2020. Costa Rica had shut its borders to all nonresidents at the time. The judge slashed Hansen's claim to the extent he seeks a refund for the portions of his itinerary that involved his arrival in, or departure from, Costa Rica, but he can proceed with pursuing a refund claim for other legs of his itinerary, according to the order.

As to plaintiff Jacob Rudolph, who kicked off the suit in April before Hansen and Buffer later joined as named plaintiffs, the judge said his claim "fails in full" because Rudolph canceled his flight before United did, but the judge left an opening for that claim to be amended.

Rudolph alleged he bought three tickets from United for an April 4, 2020, flight from Hilton Head Island, South Carolina, to Minneapolis-St. Paul, Minnesota, with a connecting flight in Chicago. But on March 16, 2020, Rudolph "affirmatively sought a refund before his flight was canceled," citing "concerns with the COVID-19 pandemic," United had argued in its dismissal bid.

United moved to dismantle the litigation in September, defending its policy of issuing credits or vouchers for future flights instead of refunds and insisting that it has acted well within the scope of its contract of carriage. It further argued that each of the named plaintiffs "affirmatively sought a refund for [their] tickets," and suggested that they "voluntarily canceled their nonrefundable tickets," because they were the ones who reached out to United requesting refunds before United ultimately canceled one or more of their flights.

United representatives have declined to comment on the litigation.

The consumers are represented by Bryan L. Clobes, Daniel O. Herrera and Nickolas J. Hagman of Cafferty Clobes Meriwether & Sprengel LLP, Steve W. Berman, Daniel J. Kurowski and Whitney K. Siehl of Hagens Berman Sobol Shapiro LLP and Joseph G. Sauder and Joseph B. Kenney of Sauder Schelkopf LLC.

United is represented by Patricia Brown Holmes, Sondra A. Hemeryck and Valerie H. Brummel of Riley Safer Holmes & Cancila LLP.

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

--Editing by Janice Carter Brown.

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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