American Airlines Inc. has filed three suits seeking an injunction to stop three ticket brokers in Salt Lake City, Texas and New York from purchasing, selling, bartering or brokering its frequent-flier bonus mileage certificates and tickets.
American charges that the secondary market in the coupons, which are good for free travel, is costly to the airline. The awards are given for fliers enrolled in the American program."The complaints allege that millions of dollars in revenue are lost due to the sale and barter of AAdvantage awards," said Lowell Duncan, vice president-communications for the Fort Worth-based airline. "We simply cannot tolerate this situation. We have an obligation to our AAdvantage members who do abide by the rules and to our paying customers to put a stop to the practice."
Defendants in the suit are Platinum World Travel and the Coupon Connection in Salt Lake City, Utah; Texas Traveller in Fort Worth; and American Coupon Exchange in New York.
Texas Traveller could not be reached for comment. American Coupon Exchange had no comment.
Bruce Briggs, general manager of Platinum World Travel and part owner of the Coupon Connection, compares the situation to a man giving an engagement ring to a woman. The woman pawns the ring, then the man sues the pawn shop.
"I don't have enough knowledge to argue the legal aspects of it, but just the logical aspects argue that someone has earned rights in something . . . should be able to do what they want as long as they don't violate any criminal laws," Briggs said.
The Utah man said he intends to fight the American suit. "We're not going to say `yeah, you're right and we're wrong' and close up shop and go away with our tail between our legs," Briggs said.
American said it specifically structured the frequent-flier rules to benefit its best customers, rewarding their loyalty with free trips and other benefits. But the airline said it did not intend to diminish its opportunity to sell tickets to other customers and potential customers who are not members.
Under American's program, a member may give awards to anybody, but the bonuses cannot be purchased, sold or bartered. Once issued, a certificate may not be transferred except to a family member with the same surname or a spouse.
In the suits, American also charged that each of the defendants "with specific intent to defraud American" acquired AAdvantage certificates from Gayle and Irwin Schreier of Tulsa, Okla., "who had obtained such certificates through computer fraud, theft and deception."
The Schreiers have been indicted "as a consequence of their unlawful conduct." The Tulsa brokers could not be reached for comment.
Briggs said that although he has purchased awards from the Tulsa brokers named in the American suit, he did not knowingly buy fraudulent certificates.
Northwest Airlines spokesman Bob Gibbons said his airline filed a similar suit last year against a St. Paul, Minn., coupon broker. "We have done a number of things to counter brokering frequent-flier benefits," Gibbons said.
Northwest officials take regular advertising in classified sections near broker ads warning the public the practice is illegal in the airline's view.
"We share similar sentiments to American, although we're not partners in their particular lawsuit that they filed," Gibbons said.