Reminder: Frequent Flyers Have No Rights

As a member of a frequent-flyer program, you have no rights.

Such, in so many words, was the subtext of a finding handed down this month by the U.S. Bankruptcy Court of the Southern District of New York in the case of Karen Ross and Steven Edelman vs. AMR Corp. and American Airlines.

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The case, which had class-action status, concerned American's right to renege on the explicit promise that AAdvantage miles earned before July 1, 1989, would never expire. Indeed, they were dubbed Miles With No Expiration by the airline itself.

But in July 2012, American broke its own promise and declared that pre-1989 miles would in fact expire. To take some of the sting out of the betrayal, American added a bonus of 25 percent when the non-expiring miles were automatically converted to expiring miles on November 1, 2012.

Common sense and simple fairness would suggest that such a clear and unambiguous promise as American's would be found to be legally binding. Otherwise, what's the point of promises and contracts?

But the judge ruled that the plaintiffs' claims were preempted by a previous case, American Airlines vs. Wolens, that also challenged American's right to retroactively put restrictions on frequent-flyer miles. Because the complainants in the current case had not opted out of Wolens, they weren't entitled to press their claims.

Wolens was settled, awarding modest compensation to the plaintiffs and, more lastingly, shielding American from any further claims relating to pre-1989 miles and giving the airline carte blanche to make any changes to the AAdvantage program they choose, at any time, for any reason.

And here we are today, with verbiage in American's (and other carriers') terms and conditions that reserves for the airline the absolute right to act as it sees fit, with no consideration for its customers' needs or rights:

American Airlines may, in its discretion, change the AAdvantage program rules, regulations, travel awards, and special offers at any time with or without notice. This means that the accumulation of mileage credit does not entitle members to any vested rights with respect to such mileage credits, awards or program benefits. In accumulating mileage or awards, members may not rely upon the continued availability of any award or award level, and members may not be able to obtain all offered awards for all destinations or on all flights. Any award may be withdrawn or subject to increased mileage requirements or new restrictions at any time. American Airlines may, among other things, (i) withdraw, limit, modify, or cancel any award; (ii) change program benefits, mileage levels, participant affiliations, conditions of participation, rules for earning, redeeming, retaining or forfeiting mileage credit, or rules for the use of travel awards; or (iii) add travel embargo dates, limit the number of seats available for award travel (including, but not limited to, allocating no seats on certain flights) or otherwise restrict the continued availability of travel awards or special offers. American Airlines may make any one or more of these changes at any time even though such changes may affect your ability to use the mileage credit or awards that you have already accumulated. American Airlines reserves the right to end the AAdvantage program with six months notice.

As an AAdvantage member, you have implicitly agreed to be bound by the above. Whether you know it or not. And whether you think it's fair and reasonable or not.

Caveat emptor.

Reader Reality Check

Is it time for loyalty programs to adopt terms and conditions that give more weight to the rights of consumers?

This article originally appeared on FrequentFlier.com.

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