Court Threatens Jail Time and Fines for Publicizing Airline Mistake Fares

Of course we all love it when mistake fares happen and they’re honored and we get to travel the world at insanely cheap prices, especially in business or first class.

For some readers booking a $28 ticket to Paris presents a moral challenge: should you take advantage of something you know is a mistake? My own view is that I’m happy to book it, airlines will choose to honor it or they won’t, but if they’re going to fly people to Paris for $28 I’d like to be one of those people.

I’ve never been a fan of suing to try to enforce these fares. Nor have I been a fan of the Department of Transportation requiring that they’re honored. But I also think airlines and consumers should be treated the same — airlines shouldn’t be able to cancel mistakes on better terms than consumers (who are generally permitted under DOT rules to cancel for 24 hours after purchase if it’s more than a week out from travel).

Several years ago the Swiss first class fare originating in Myanmar was cancelled and the airline argued because it was discussed online as a mistake they shouldn’t have to honor. So many frequent flyers stopped calling great bargains ‘mistakes’.

Now that same issue returns. Via Wandering Aramean a German court ruled that a website distributing an ‘error fare’ on Lufthansa can be held liable in the future with both jail time and fines for publicizing mistakes that are called mistakes. At issue was “a business class return flight ticket to California for EUR 687 per person instead of the regular price from 3846.”

  • Lufthansa suffers bad publicity when they don’t honor the deal

  • They run up legal fees, both in Germany and abroad

  • It takes time to cancel and resell the space, losing some opportunity to sell tickets at a higher price. (This seems speculative at best, since flights rarely sell out through mistake fares.)

  • Publicizing an error fare increases the costs and consequences to the airline

In Germany apparently ‘truth’ is not a defense. Since the website publicizing the mistake is a “market leader in the area” they exacerbate the costs to the airline in a way no individual booking the tickets could and in doing so “acts unfairly.” If the website does it again they risk 6 months in jail and a 250,000 euro fine. Although it’s not clear that any consequences would follow if they simply highlighted spectacular deals versus mistakes.

In fact it’s often not clear whether a great deal is a mistake or not. When we started seeing $300 transatlantic fares two years ago I thought they were mistakes, same with $400 transpacific fares, but it turns out there have just been really great short-term (intentional) sales.

Some mistake fares are obvious to most consumers, but there have even been ‘obvious errors’ that were intentional marketing stunts. Drawing bright lines is hard.


Credit: Frank Unterspann via Wikimedia Commons

Back in 2005 Washington Dulles-based Independence Air loaded mistake fares intentionally into their system around midnight. They waited until a few tickets were purchased and then called the Washington Post in the morning, with the message that you never know what kind of great deals you might get at flyi.com! It was a guerrilla marketing campaign.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Maybe they don’t have a comparable to the 1st Amendment in the German Constitution, but as a Western democracy, happened to free speech and free press???

  2. New first sentence: “Of course we all love it when the local Best Buy store leaves its back door open overnight and we get to go in and grab stuff.”

  3. The new German constitution written under military occupation at the direction of military men like Patton and Eisenhauer does not place much importance on freedom of speech. e.g. Its a jailable offense to display Nazi symbols in Germany while in the US the first amendment protects even hate speech..
    The aim of the constitution was to keep Germany under control and not to let every German reach their potential.
    When you give up a little liberty for security eventually you lose both. Its happening in Germany now.

  4. @Kalboz : 2 things. First, the 1st amendment also has restrictions on what is considered “free speech”. it does not equal “any speech”. and there’s no rule that other countries must be at the exact same level as the US to be listed as a “western democracy”.

    and if you wanna talk about free press, here’s the 2018 World Press Freedom Index (https://rsf.org/en/ranking) :

    #15 Germany
    #18 Canada
    #40 UK
    #45 USA

    Or maybe the 2017 Human Freedom Index by the Cato Institute (https://object.cato.org/sites/cato.org/files/human-freedom-index-files/2017-human-freedom-index-2.pdf) :

    #9 UK
    #11 Canada
    #16 Germany
    #17 USA

    So before us Americans go around judging our closest allies, maybe we need a bit of introspection

  5. @Prabuddha….it is happening in AMERICA right NOW….in the post 9/11 world, free speech is limited or can land you in jail with little or no rights, phones tapped without warrants, etc. Of course it isn’t publicized much because frankly, most Americans don’t want to hear about it, they just want to feel safe and protected by their government. Check out some of the websites like the ACLU or the NAACP legal pages and see the stuff law enforcement has gotten away with, it will scare the hell out of you because for every case that is lucky enough to be taken on by a big group with money, there are thousands and thousands who aren’t who are rotting in jails.

    Check out those eminent domain websites, sure, at first glance it seems unbelievable that this stuff happens HERE in the land of the “free” but when you realize that those folks aren’t crazy, they’re victims of big business….that if a Walmart wants to move to your town and tear down your ENTIRE NEIGHBORHOOD they can do it even if your home has been in your family for 150 years, they can, you’ll see we aren’t much different from them.

    Since this stuff happens on a daily basis but not on a huge scale, it doesn’t affect your average Joe so most of us never actually encounter it personally and could care less and it reminds me of the old passage about “until they came for me” but it is scary. I try not to read it much or dwell on it much because it is frightening when you realize most of us are okay as long as we don’t draw attention to ourselves or the ire of any agency…..but if you ever do…. and no, I’m not a conspiracy nut, but I can and do read 🙂

  6. Idiot judge. All the more reason not to travel to Germany.

    Solution is simple. Next time this happens, the website should mention the fare and write: “THIS IS A TERRIBLE NO GOOD FARE. IT IS NOT AN INCREDIBLE UNBELIEVABLE BARGAIN. DO NOT BOOK IT UNDER ANY CIRCUMSTANCES. JUST DON’T.”

  7. ” At issue was “a business class return flight ticket to California for EUR 687 per person instead of the regular price from 3846.””

    Ok. So if I find a business class return flight ticket to california (from germany?) for $3,200, it’s clearly a mistake then, as we’ve now been given a “regular” price. I’m sure a last minute ticket at $10,000 isn’t a mistake though, even though that’s not the “regular” price of 3846.

    There’s just no way for a consumer to know what is a deal and what’s a mistake, and this leads to the airline being able to honor (and not honor) whatever they want.

    Heck, you could see an airline advertise “$500” roundtrip fares, then later come out and say “oh no, we didn’t mean to advertise that,” and then rescind that. There needs to be clear guidelines for consumers.

  8. I believe that most travelers are happy to pay a fair price for service. Taking advantage of a mistake does not seem ethical to me. If I made a mistake in my business I would hope that my customers would be just as understanding and gracious.

  9. I agree, at least a little with @Andy. If a website that was widely read advised all of it’s readers that the back door of the Best Buy was left unlocked and encouraged it’s readers to go help themselves, would that not create some liability on their behalf? Free speech will (and should) always have limits.
    Whether that applies when someone has accidentally mispriced a product is certainly a reasonable question, however, if you neighbor was selling his car and accidentally put a sign selling his 2016 BMW for $400.00 instead of $40,000, would you all feel good about making him sell it to you for $400? I agree with Gary that they should have the same right of rescission as their customers do and, unless the act in question is a criminal act, websites should not be prosecuted for publicizing it.

  10. @farnorthtrader the comparable example would be if he actually sold it to you, should he be able to force you to unwind the arms-length sale

  11. The best buy example isn’t really a fair comparison. Retail very often uses the strategy of a “loss leader,” where a product is deliberately sold below cost in order to generate traffic and boost brand awareness/ loyalty. If best buy has a $1000 laptop priced at $100, no one thinks, “that must be a mistake!” To apply airline thinking, best buy could tell you on Christmas eve that they expect the $100 laptop back because they’ve decided the price was too low. This sort of thing, incidentally, is very much against common law and the fact that it is legal represents a capture of regulators by industry.

  12. To add to examples where obvious mistakes are not so obvious: I’ve bought US domestic tickets for $1. Granted this was shortly after 9/11 on a now defunct airline (I think it was called National, based in Las Vegas), but you never know when a particular airline might feel an existential threat and desperately lower its prices.

    I’ve bought RyanAir tickets where out of a 20 euro ticket, 19 were taxes. And I’ve seen BA tickets just recently selling for substantially less than RyanAir on the same non-stop route at the same time of day.

    You never know when an unMISTAKEnly great bargain might pop up 😉

  13. If an airline can rescind a fare saying it was a mistake, too low, then a customer should have an equal right to rescind a purchased fare, saying it was too high. Especially if there’s a disadvantageous equipment-change, mech delay, lost baggage, schedule-change etc.

    But with the US is in the grip of big business there’s a new trend of “deregulation”, meaning corporations can trample on individuals without comeback. Regulators such as the already-feeble DOT have become helpless.

    Meanwhile I’m happy to make a small effort to redress the balance by taking advantage of “mistake” fares.

  14. An easy solution is obvious to all. Simply shoot the judge. Who does he think he is anyway? The next best thing since God? Some of these ‘judges’ have their head up their ass.

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