American Airlines won a $9.4 million verdict against Skiplagged for copyright infringement. That’s being reported as a huge win for American, and vindication of their fight against throwaway ticketing. It is not.
To be clear, a nearly $10 million verdict isn’t great for Skiplagged, though there will be appeals. American is nowhere close to collecting that much money.
However what’s important is that American Airlines mostly lost. Remember, they were after $94 million primarily over trademark infringement and also fraud. None of that held up.
American’s lawsuit alleges that Skiplagged’s marketing of the practice violates the airlines’ ticketing practices, puts travelers who booked flights through Skiplagged at risk of having their tickets invalidated, infringes on American’s trademarks and fraudulently advertises lower fares than customers end up paying.
“It is the classic bait and switch: draw consumers in with the promise of secret fares, and instead sell the consumer a ticket at a higher price,” American alleges in the lawsuit.
Trial in the case began Monday before Judge Mark Pittman of the U.S. District Court for the Northern District of Texas. American Airlines is seeking more than $94 million in damages.
The copyright claim seems rather silly, since identifying American Airlines was how Skiplagged explained to consumers the facts of the schedule they’d be flying.
But the other claims were far stupider. The notion that customers were being hoodwinked by Skiplagged, when they go there precisely for a ‘travel hack’ that generated actual savings, not out of a belief that American Airlines endorsed the practice. American cares about Skiplagged because they’re undermining American’s pricing and saving customers money.
Throwaway ticketing is a practice that’s gone on for decades. Airlines often charge more money for non-stops than they do for connecting itineraries. So people book a flight with a connection through the city they want to travel to, and just don’t take that second connecting flight. As a result, they can often save money, but there are risks.
It is not illegal to engage in throwaway ticketing. It violates airline rules. And people disagree with the ethics. You ‘agree’ to the airline’s contract, with terms you likely do not know about, when you buy the ticket. Is it unethical to violate an adhesion contract, with whatever airlines decide to throw in there? You’re buying seats on two flights, isn’t it up to you whether to use those seats or not? To the airlines, though, a trip between Gainesville and New York is different than a trip from Gainesville and Charlotte and comes with different pricing. Flying to Charlotte instead of New York, at a cheaper price, is stealing.
More important than the ethics for many are the risks. If your flight is delayed or cancelled, your airline may want to re-route you through a different hub than the city you actually wanted to fly to (and get off in). You can’t check bags, because those will go to your final ticketed destination rather than where you’re flying. And if you’re forced to gate check a bag when overhead bins are full, you’re in a bind. Plus, you can only book these one way because if you throw away anything other than the last flight in your itinerary the rest of the trip gets cancelled.
And of course since you can’t check bags on a ticket like this, you really shouldn’t check in at the airport and involve a live agent in the process. Check in online or using the mobile app. And if you don’t do that, at least use a kiosk.
It’s worth noting that, while the practice is not illegal, airlines can and will ban you from flying / close your frequent flier account with them if they think you are practicing this. Do throwaway ticketing at your own risk.
Can anyone here think of a case where skiplagging does not reduce AAs monopoly power?
Noone has ever been banned for hidden city. Noone.
Old wives tale
For a while WN specifically allowed this in their terms.
They disallowed it some years ago b
At one point United allowed it, too! Though a decade ago they sued Skiplagged for it, and did not prevail.
Weird name ski plagged. Is it only for people who ski?
Why does a gate checked bag cause a problem? You get your bag back at the end of the flight.
@christian, no you do not get a gate checked bag back at the end of the flight. It is checked to your final destination. You may be thinking of a “gate valet” checked bag, which is different, and only available for smaller bags on commuter planes that cannot accommodate the bags.
Like so many other business practices in the 21st century United States, the root of this problem is an unethical business practice by the airline. American is price gouging customers that want one of their hubs as a final destination by virtue of the fact their presence excludes their competitors. The service isn’t priced as cost plus markup, rather it’s market price where the business controls a significant percentage of the market. Least we believe that it’s a free market and their competitors could simply move in, it’s not. Whether American in Dallas, Delta in Atlanta, or United in Chicago, airlines guard their slots jealously exactly because runnning a near monopoly allows you to make the price whatever you can extract from the customer. An exceptionally easy way for government to punish businesses for this behavior is to deny them civil relief when the customer turns the tables on them.
I have friends and family members that have sworn by “skiplagging” for years. These flyers generally aren’t flying enough to really care about frequent flier miles or status. They would be impacted of the airline simply banned them from flying. So following up on toomanybooks’ post – are there actually examples of flyers being banned for hidden city ticketing / skip lagging?
When I was a boy, I worked in reservations at a legacy carrier. Andolder agent told me that they used to routinely search for beyond point fares to offer to the passengers, but not anymore. It’s American’s own fault and it’s on them that they do not charge the “Higher Intermediate Point” fare (that is an international pricing rule) yet don’t because they want all the money they can get. If I buy a ticket from Paris to Montréal with a connexion at Newark for $176 one-way vs. $1700 Paris to Newark, isn’t it the right of the public to choose which flights they want? Clawing back the money is like the cow coming to your door demanding compensation because you bought a quart of milk but only drank a pint of it. And isn[t avarice ugly, AAL?
It’s ridiculous that a court would even uphold American’s rule. Let’s say you go to McDonald’s and they have a meal deal of burger, fries and a drink, which is cheaper than buying the burger and drink alone. But you don’t want fries. So you order the meal deal, and don’t eat the fries. Can McDonald’s successfully sue you for not eating the fries? Of course not. Same principle should apply to airlines. You bought the 2nd leg, and paid for it. It should be up to you whether to use it or not.
Airlines charge based upon in part demand for a particular route. And of course other factors. New York to Los Angeles or New York to Chicago is far more in demand than New York to Fargo, ND or New York to Pittsburg. Normally if you don’t make a habit out of it airlines will look the other way if you throw away the last leg. But as noted there are risks that could really screw you. Like ending up in New Orleans when you were flying back home to Dallas. It’s just not worth whatever you’re saving.
@Mark R. If you (re)read the original post, your contention “that a court would even uphold American’s rule” is false.
It seems to me the problems of the airline complaining of not using the ticket for the second leg of a flight could be explained away as getting sick and not being able to complete the flight. If you show up sick enough, airlines will not let you board. If they complain, ask them for the second leg ticket for free on an agreeable date. I would bet that they would never do that. The way to deal with carryon luggage is to have it in a size that could be a personal item. If more is needed then use a small backpack. The checking of carryon bags is limited mostly to roller bags since they are the ones that take up the most room. Remember to carry a lot of lithium ion power banks so you can point out that they cannot go in the hold of an airplane. If they want those out and still want to check, claim the you have more than you have found so that the other one or ones have to be hidden in the bag somewhere. Lying is a common trait of airlines interacting with passengers so I find it to not be any different if passengers lie to the airlines.
Such abuses by railroads in the 19th century prompted the formation of the Interstate Commerce Commission which specifically banned charging less for a longer haul than for a shorter one. The affected consumers, farmers in that case, banded together to counter the political power of the monopoly carriers.
“The copyright claim seems rather silly”
Copyright is not the same as trademark.
@Tony Q – yes, and they lost the trademark argument
I can see that sometimes skiplagging can be beneficial to the airlines too, for example when they oversold the flights. Airlines can usually fill the seats with higher fare tickets.
Wish we didn’t have to depend on the airlines so much; despise them sometimes. America should have thought of high speed trains a long time ago.
Its called monopoly. They control the way we high speed travel.
@toomanybooks
Southwest changed the terms from explicitly allowing it, to not mentioning, i.e. neither approving nor disapproving of the practice. Same with their seat saving policy (neither one way or the other). They did not change their policy on skiplagging to disapproving of it.
@Donald Kelly: Odd that your monopolies are not making money. You need some things called facts rather than just spouting a left wing stump speech. Best route: Don’t pretend to be an economist, you just sound stupid.
@Tod T; Good exception! And you are the only person who found one.
@L3 thinks airlines don’t make money but calls other people stupid. The CEO of American Airlines took home a total compensation package of $31.4 million in 2023. Maybe, if they want to show more profits on the board for the dumb economists, their management should reduce their takehome pay by just a few million dollars. I’m sure that would cover the skiplagging difference.
Why defend people who are so rich they could literally convince you to sell yourself to them as a slave? And would in a heartbeat, if you didn’t consider yourself to be so expensive.
$31.4 million is what Robert Isom, CEO of American Airlines, took home in pay last year (2023). I know a great way for them to recoup those 90 million dollars they want back.
I don’t see how this holds up. Forcing someone to get into a plane they don’t want to get into is called kidnapping or in effect blackmail if they hold canceling your right to travel with them over your head. What if someone got sick after landing and they don’t want to get back on board. Say they had a sharp pain and thought it was appendicitis. Are the gate agents doctors? What if a woman felt she was assulted and isn’t comfortable flying so soon? It’s not up to the airline to judge why or why not someone chooses to get on. They sell a ticket for a price, it was paid. Fix your pricing model and shut up.
No dog in this fight but commercial airlines were expected to register a net profit of 27.4 billion U.S. dollars in 2023. Seems like they are making money. Don’t care if someone thinks it’s high or low but they are making money.
I find it funny that an airline will bitch if you no show for the second leg of your itinerary, but they don’t have a problem denying you boarding when they oversell the same flight.
Ahem, my thoughts on the matter:
As Derek points out above: What’s immoral, besides waste, about buying a gallon of milk if it’s cheaper than a quart and throwing the rest away? Why would an airline make such an offer?
If direct flights to hubs are in more demand and hence they charge more for doing so than if you’re continuing on to another city, the likely reason is one of regulation and common access: The airlines may be regulated, or for their own sake of consumer advocacy, to providing hub connected flights to less serviced routes.
In effect, the airline is subsidizing, either on their own or via regulatory fiat, the cheaper price to fly to a less in demand connected city than to the hub directly.
After all, if the destination city was in such high demand, wouldn’t there be a cheap direct flight to it?
If everyone skipplagged (which wouldn’t happen for the reasons mentioned above) then the airline could justify shutting down the connecting flight if it was half empty due to so many skiplaggers but then what about the people who rely upon that flight to go to that city?
That said, the airline has a right to enforce its rules and presuming they are in place to help make transit to lesser served routes more affordable, I fully support them if they get around to it to penalizing the rule breakers which shouldn’t be all that difficult. Computers are amazing things. If they want to hire me, I’d be happy to code for them an option:
If someone is booking a route that’s commonly skiplagged
AND
they booked it through a travel agency where skiplagging occurs
AND
they’re booked one way with no checked baggage
Then they get notified by email and in the app they can’t check-in online and they’ll need to gate-check ANY carry ons onto the flight.
That should make it unpleasant for the majority of ’em.
You left out that it was a jury that awarded the damages, not a court. Unless a jury of American Airlines peers is considered to be its friends like UAL and SWA, then we have to trust our fellow citizens on this one, right?
“Airlines charge based upon in part demand for a particular route”
Ultimately the airlines’ entire premise here is a defense of price gouging: selling a product with high demand at a price well above the cost of production and profit margin they accept elsewhere.
That said, I see the benefit for airline operations at medium size cities that can connect through multiple hubs. If hub A is disrupted, connecting passengers can be rerouted through another while those actually heading to A must wait and clog up the system.
I am beyond skeptical that the financial benefit of this flexibility to the airline justifies the extent to which connecting flights are discounted though. Rather, what are essentially negative prices for flight legs to smaller airports is one more hidden subsidy to rural America.
What about buying a round trip ticket when you’re only flying one way? I’m going on a transatlantic cruise from Fort Lauderdale to Barcelona. I only need a one way ticket from Barcelona back to Florida. It turns out that the price for a round trip ticket is less expensive than a one way. Should I buy the round trip ticket and just throw away the return ticket?
So how does this decision validate throwaway ticketing? I’m guessing it must be related to what charges they didn’t convict Skiplagged on, but the blog post and articles linked don’t really make that clear.
@PolishKnight – sorry, your program won’t necessarily affect “the majority” of those doing it, as you claim. I’ve flown AA enough to be Lifetime Multi-Million Mile Platinum, and have used hidden city tickets more times than I can count. Those who know about it like me, are seldom using travel agents. You can book it that way yourself right on the AA website.
As a former customer service agent for AA, I was prepared when the auto-reacommodation tool would run and route someone to the booked final destination; without the ‘hidden city’ stop. The howling would be heard for miles.
I bought a large pizza and decided not to eat all of it. I hope Little Caesar’s doesn’t ban me from buying pizzas from them in the future .
It’s all supply and demand. Most people want to go to New York. American knows this so they jack up those prices because they can charge more for those tickets. Easy. But, whoops, oh look, this loser wants to go to Charlotte. Since that’s where he WANTS to go, we can charge more so we’ll jack up that price.
American doesn’t want the loser to figure out that if he doesn’t TELL them he wants to go Charlotte, he can get a better price for his ticket. I mean, then he’s gouging THEM instead of them gouging HIM!
I’ve never actually skiplagged but my Godmother used to live in Atlanta and I would arrange REALLY long layovers so I could get a little GM cuddle on my way to/from pretty much anywhere. My travel agent used to help me do this even 30 years ago – even up to 24 hours and the airlines seemed cool with it. I wonder if they would be now? Lord, I miss that woman. Um, the Godmother, not the travel agent – although, truth be told, I do kinda miss the travel agent too.