American Airlines is facing a proposed class action in a US federal court brought by members of its loyalty program. The members are accusing the carrier of “improperly” closing certain members’ accounts and canceling their accrued airline miles.
In the lawsuit filed in San Jose, California on January 29, 2024, Ari and Shanna Nachison, who are members of AAdvantage (American Airlines’ frequent flyer program), claim they each lost over 550,000 award miles when their AAdvantage accounts were unilaterally terminated by the airline in early 2020.
Furthermore, the pair claim that some of the miles that disappeared had already been spent on upcoming fights, although those flights were subsequently canceled by the airline.
In their legal filing, the two passengers cited descriptions of similar situations they had read about online, including a reference to a blog post by a self-described “travel hacker” who also claimed his AAdvantage account had been “shut down” by the airline.
The claim argues that American Airlines’ decision to terminate AAdvantage accounts entirely was improper and that it denied AAdvantage members the benefits they had accrued through previous purchases. “It is unclear precisely why American Airlines decided to terminate AAdvantage accounts but it is clear that doing so was improper,” the claim states.
According to defense papers filed with the court by American Airlines, it is alleged that the two members had “violated the general AAdvantage program conditions” leading to their accounts being shut down, although no further details on this matter have been disclosed.
The suit details describe how the two plaintiffs earned miles by using American Airlines branded credit cards offered by Citibank and Barclays. Neither of the banks are named as defendants in the lawsuit.
According to the Nachisons, they had opened and used multiple American Airlines credit cards to take advantage of certain promotions offered to participants in the loyalty program, noting that some of the credit card offers restricted the availability of certain promotions to members who were already benefiting from other AAdvantage offers.
However, they noted that other promotions did not involve the same restrictions, asserting that, as a result, it should follow that “multiple Citi-AAdvantage credit cards and Barclays-AAdvantage credit cards could be opened without violating American Airlines’ terms and conditions.”
The Nachisons claim that when the airline shut down their frequent flyer accounts, it “seized on an opportunity to steal all of these AAdvantage account holders’ earned bonus miles”. The suit added: “Doing so ensured that American Airlines would no longer be required to provide the monetary benefits to these account holders through trading in bonus miles for tickets, hotel promotions, or flight seating upgrades, etc.”
The allegation is that American Airlines breached its contract with its loyalty program participants and unjustly enriched itself with its conduct. The proposed class action could potentially be expanded to other members of the AAdvantage program. This might include those who either had their accounts closed or else believed that points had been inappropriately deducted from their accounts.
In their suit, the Nachisons described the airline as one of the world’s largest, noting the company has claimed its frequent flyer program, which launched in 1981, has more than 115 million members. According to the pair, the company’s 2022 public filings indicated that about 7% of its total revenue from passengers’ miles flown was from award travel.
Fort Worth-based American Airlines is yet to comment further on the ongoing legal proceedings.