Major Airlines Bring A Lawsuit Against Biden Administration Over Fee Disclosure

Major US airlines are taking legal action against the Transportation Department over a new rule mandating upfront disclosure of airline fees, marking the latest clash between air carriers and the Biden administration.

Airlines for America, joined by American Airlines, Delta Air Lines, United Airlines, JetBlue Airways, Hawaiian Airlines, and Alaska Airlines, filed a lawsuit in the US Fifth Circuit Court of Appeals late Friday, as revealed in a copy of the suit.

The USDOT issued final regulations last month, necessitating airlines and ticket agents to divulge service fees alongside airfare, citing the benefit to consumers in avoiding unnecessary or unforeseen charges.

In a statement on Monday, Airlines for America contended that the department’s rule would bewilder consumers, asserting that its “attempt to regulate private business operations in a thriving marketplace is beyond its authority.”

The airlines’ lawsuit denounces the rule as “arbitrary, capricious, an abuse of discretion, and otherwise contrary to law.”

The USDOT, which refrained from commenting immediately on Monday, previously stated that the new rule would lead to reduced fees for many consumers traveling by air.

The agency claims that consumers overpay $543 million in fees annually, with airlines garnering additional revenue from surprised passengers compelled to pay higher fees at the airport to check a bag.

The rule mandates airlines to disclose baggage or flight change fees individually at the initial provision of fare and schedule information on their online platforms, prohibiting their display through hyperlinks.

Moreover, it necessitates airlines to inform consumers that seats are included in the fare without any requirement to purchase a seat assignment for travel.

Southwest Airlines, while expressing support for some provisions in the USDOT proposal, opted not to participate in the lawsuit. US airlines accrued nearly $6.8 billion in baggage fees in 2022 and $5.5 billion in the first nine months of 2023.

The airlines have not contested a separate rule finalized by the USDOT last month, mandating automatic cash refunds for canceled flights when passengers decline to accept a new flight.

“Too often, airlines drag their feet on refunds or rip folks off with junk fees,” remarked President Biden, underscoring the mandate’s role in safeguarding passengers from surprise charges.

Ethan Johnson
Ethan's journey into journalism began with a deep curiosity about how businesses operate and evolve in today's dynamic markets. Armed with a degree in Journalism from a prestigious university, he embarked on his career, initially covering local business developments before expanding his scope to national and international commerce news.