A U.S. Court Limits The Right To Sue When European Airlines Cancel Or Delay Flights

In theory the European Union has the strongest consumer air travel protections. Its EU261 requires cash compensation for many flight delays. But airlines drag their feet paying compensation, and Americans can’t sue for EU261 compensation in U.S. courts according to a new ruling.

NV Flyer, which covers legal developments in air travel, writes about Click 2 Refund Inc. v. British Airways where BA beat back a lawsuit over EU261 passenger compensation for a cancelled flight. They won on two important points,

  • You can’t sue for an EU261 violation in a U.S. court
  • Signing a ‘power of attorney’ alone doesn’t assign claims and give a third party company the ability to sue in its own name

British Airways removed the case on federal question grounds, asserting that the U.S. district court had original jurisdiction because the subject claim was for a delay in international transportation and thus governed by Article 19 of the Montreal Convention. British Airways subsequently moved for judgment on the pleadings on three bases, that (i) Click 2 Refund was not the real party in interest, (ii) claims under EU 261 cannot be brought in U.S. courts, and (iii) the delay claim arose, but failed, under the Convention because there was no allegation that Click’s customers had sustained any compensable damages.

What You’re Entitled To For European Flight Delays

EU regulation 261 (2004) requires airlines to compensate passengers between €250 and €600 cash for flight delays of over 3 hours, for cancellations, and for involuntary denied boardings due to overbooking. The amount depends on the distance of the flight.

This applies to flight departures from EU countries, and it applies to flights headed to the EU on airlines based there. It also includes Iceland, Liechtenstein, Norway and Switzerland. And it applies to award tickets not just paid tickets.

Compensation even applies to cancellations that happen in advance, not just the day of departure. In fact if the cancellation happens within two weeks of departure an airline has to pay compensation unless they can provide transportation more than two hours earlier that arrives no more than four hours later than originally scheduled. The rules get more stringent within a week of departure.

Handling A Claim Yourself

You can simply write to the airline’s customer service something to the effect of,

I am writing regarding flight NUMBER on [date] from AAAA to BBBB with scheduled departure time of XX:XX. My record locator is ZZZZZZZ and ticket number 0000000000.

This flight arrived TK hours late [or “was cancelled and I arrived on flight ABC at XX:XX on Y date.”] Therefore I am requesting compensation under EC Regulation 261/2004.

The flight was XYZ kilometers therefore I am seeking €[amount].

Thank you for your assistance. I look forward to your reply within 14 days.


Selling Your Claim To A Third Party

There are many companies that will take over the hassle of fighting with an airline for compensation. Airlines often stonewall and count on consumers giving up in order to save themselves money, although if you’re persistent enough they’ll often pay out. In outsourcing your claim you’re paying someone on a contingency fee basis to be persistent on your behalf, and avoid the hassle yourself. Click 2 Refund, the plaintiff in this suit, claims a 98% success rate in court. I imagine given the amounts involved they often obtain default judgments.

What The Court Ruled

A U.S. resident (or third party) who wants to sue needs to do so in Europe, according to the district court and Seventh Circuit precedent. So you are selecting from a company to go after compensation on your behalf (many such companies will pursue an EU261 claim for a cut of the payout) you may want to select one based in Europe.

They ruled that the power of attorney used in this case didn’t actually assign the claims to let the third party sue. That’s a defect that would have been easily corrected if the suit itself were permissible. Similarly, the court also ruled that the claim in the U.S. arises out of the Montreal Convention, and that requires showing actual expenses or losses, again a defect that would have been correctable.

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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  1. It would not be advisable to get help in U.S. Courts from a company that thinks a Power of Attorney will work as an assignment of the claim (if the claim can be assigned at all).

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