By Naveen Athrappully
Spirit Airlines has agreed to an $8.25 million settlement in a class action lawsuit that accused the low-cost carrier of misleading passengers through high, hidden baggage fees.
According to the lawsuit (pdf) filed by plaintiff Thomas Cox in 2017, Spirit was accused of having “misled the Plaintiff and numerous other consumers, and continues to mislead consumers, into believing that they are purchasing low airfare, when, in fact, Spirit makes up whatever discount it purports to give consumers in fraudulent and unwarranted charge.”
“In some instances, a carry-on piece of luggage costs as much as four times the cost of a checked piece. Spirit’s bait-and-switch and ‘gotcha’ tactics are designed to confuse, trick, and trap consumers to the public’s detriment.”
The lawsuit claimed that Spirit does not make its fee structure clear to consumers who purchase flight tickets via third-party vendors. The nature of the airline’s baggage fee structure is “misleading,” it said.
Customers pay the least amount in baggage fees if they pay it online before getting to the airport. Once the customer arrives at the airport, the baggage fees “increase incrementally,” which in some cases can go up to $100. Bags that are checked ahead of time usually cost around $40, according to The Hill.
The lawsuit pointed out that former Spirit CEO Ben Baldanza had called the $100 baggage fee a penalty. However, customers are not advised in advance that they would be paying the penalty, it stated.
The proposed settlement (pdf) was agreed upon by nine plaintiffs, with the settlement class members including first-time fliers of Spirit Airlines who bought their tickets between Aug. 31, 2011, and May 3, 2017, from any of the following six online travel agents—Expedia, Travelocity, Kiwi, CheapOair, CheapTickets, and BookIt, according to the agreement submitted Wednesday at a federal court in Brooklyn.
The settlement will provide class members up to 75 percent of the carry-on bag fee they paid. The amount is inclusive of all potential costs, including attorney’s fees, administration costs, and other expenses.
“A potential recovery of up to 75 percent recovery of damages is, Plaintiffs submit, an exceedingly fine class action settlement. Indeed, oft-times class actions settle, and can be approved as fair and reasonable, for even a small percentage of that amount,” the settlement states.
Attorneys can get paid up to $2.75 million, which is a third of the $8.25 million settlement. Each class representative, or the plaintiff, can get a maximum of $7,500. The settlement will only take place after the court approves the deal.
Spirit has identified over 800,000 potential class members. However, the airline does not have the mailing address of roughly 350,000 of the members.
“It is not known specifically how many of them resided in States that have shorter than New York’s six (6) year statute of limitations and whose claims would be barred by such a shorter statute of limitations,” the settlement states.
Plaintiffs calculate the list of class members could be lower by 10 percent at 720,000. Spirit estimated that the average carry-on fee paid by all potential class members amounted to $45.83.
Multiplying $45.83 with 720,000 potential class members, the total damages would have come to around $33 million.
“But, there would not have been an aggregate award of damages at trial because the number of Class Members with non-time barred claims is unknown,” the settlement stated.
“As a result, a claims process would have to be employed post-trial, and Spirit would only be liable to pay those persons who establish they are Class Members and only to the extent their claims are not time-barred.”
Hence, Spirit’s actual trial exposure could have turned out to be more than the $8.25 million it agreed to pay as settlement, or it could have been lower.
Seen in this context, “the proposed Settlement is substantial in light of the best possible recovery,” the settlement stated.
Airline Baggage Fees, Luggage Responsibilities
Airlines are obliged to clearly state the baggage fees to passengers who book tickets online according to the Code of Federal Regulations.
If a domestic or foreign carrier has a website through which they sell flight tickets, they should “promptly and prominently disclose any increase in its fee for carry-on or first and second checked bags and any change in the first and second checked bags or carry-on allowance for a passenger on the homepage of that website,” per the regulations.
Airlines or their ticket agents should also “clearly and prominently” disclose on the screen in which a fare quotation is offered to customers that “additional airline fees for baggage may apply and where consumers can see these baggage fees.”
Passengers should also be informed about their free baggage allowance and any applicable fee on a carry-on bag and the first and second checked bag.
According to the U.S. Department of Transportation (DoT), airlines are responsible for repairing or reimbursing a passenger for any damaged baggage or its contents if the damage occurred while the bag was under the control of the airline during transportation.
In case of lost luggage, an airline would usually declare it as lost between five and fourteen days after the flight.
However, “if an airline unreasonably refuses to consider a bag lost after it has been missing for an unreasonable period of time, the airline could be subject to enforcement action by the DOT,” the agency states.