British Airways Settles Fuel Surcharge Lawsuit: You May Be Entitled To Avios Or Cash

If you’re a British Airways Executive Club member based in the US who redeemed Avios several years back, you may soon find that 12,500-35,000 Avios will automatically be deposited into your Executive Club account.

Class action lawsuit over British Airways fuel surcharges

A class action lawsuit settlement has been reached with British Airways in US court, regarding the fuel surcharges they impose on award tickets. The lawsuit alleged that there was no correlation between British Airways fuel surcharges on award tickets and the cost of fuel, and that this breached the Executive Club terms.

While British Airways denies any wrongdoing, they have agreed to a settlement. The court is expected to sign off on a settlement of over 2.2 billion Avios on July 27, 2018, though that’s always subject to change.

Who is entitled to compensation (Avios or cash)?

This settlement includes all US Executive Club members who redeemed Avios for award tickets between November 9, 2006, and April 17, 2013, and who paid British Airways imposed fuel surcharges. It that describes you, and if the judge signs off on it, you’ll receive either Avios or cash.

If you do nothing, then you should automatically have the following number of Avios deposited in your Executive Club account within 30 days of when the case is signed off on:

  • 12,500 Avios if you made one redemption
  • 20,000 Avios if you made between two and five redemptions
  • 35,000 Avios if you made six or more redemptions

Alternatively, members can elect to receive a payment of 16.9% of the total fuel surcharges they paid for all award tickets they purchased during the period, with a minimum of $5. In order to select this option you’ll have to file a claim by July 29, 2018. Here’s the page where you can file a claim for cash compensation, though it won’t be live until June 3. That’s also the page where you’ll be able to look up what you’re entitled to, and that should go live as of the same day.

How big of a case is this?

The lawsuit says that the total number of Avios that will be placed in Executive Club accounts will be up to 2,228,667,500 (it will be less if people opt for cash). Yes, we’re talking about over two billion Avios. If we assume most people made a single redemption, that means ~178,000 members are impacted.

Before you send the lawyers involved any gifts to thank them, note that they’re doing quite well here — they’ll be compensated nearly $15 million, including $3.75 million in “expenses” and $11 million in fees, which is about 28% of the $42 million settlement compensation.

Comments

  1. I wonder if this might count for YQ that was imposed by BA on a partner airline redemption… Thoughts?

  2. Why all that bitterness in the last paragraph about the lawyers’ payment? They, like any professional, work and expect to be compensated. Have you started working for free?????

  3. @ Me — I’m not bitter at all? Just pointing out that I thought the payment amount was interesting.

  4. @Lucky – the surcharges are still crazy though for BA and Virgin. Can we expect this to change for US-originated redemptions?

  5. Will the Avios be automatically credited back or is there some kind of form you have to fill out. Do you have to call BA – what is the process here?

  6. @Me I didn’t pick up on any bitterness.

    For what it’s worth, the lawyer fees are pretty much par for what would be expected.

    What I find fascinating is the court-sanctioned valuation of avios: $42M in settlement less $14.845M to the lawyers = $27.155M to the class defined as 2,228,677,500 avios = 1.22 cents per avio. Remarkably close to what I’d value them at!

  7. Barbara Jones the special master hired by Kimba wood charged usd 43000 for work over a 4 to 5 days related to Michael Cohen. This was only for some fluff stuff like accepting documents, cataloging etc.

  8. I think perhaps @Me takes issue with the unnecessary scare quotes around “expenses.” It’s not at all hard to see how there would be $3.75M in costs on a case of this magnitude. And 28% is within the normal range for a class action settlement. You have to understand the law firm’s partners take a significant financial risk when pursuing a case like this, and their $11M is not at all guaranteed.

    I think the more interesting takeaway is that BA values Avios at ~1.88 cpp.

  9. “I wonder if this might count for YQ that was imposed by BA on a partner airline redemption… Thoughts?”

    Yes, a very good question. I don’t recall paying much YQ for my biggest redemption during that time span (CX LAX-HKG-CGK, DPS-HKG-LAX, in J, before the big devaluation) but I probably paid something.

  10. While people like to always bash the “greedy lawyers”, this is one time that each of those affected, who will receive a minimum of 12,500 Avios without lifting a finger, ought to celebrate the fact that certain lawyers saw a wrong, risked their time AND their money, and received a measure of justice for all those affected. It’s fine to bash lawyers some of the time, just not all of the time. I think the quotes around “expenses”, as if they weren’t, say, expenses that the court would have to approve, carried with it an intended (or unintended) dig at the lawyers.

  11. I suppose that Alaska Airlines members that got hosed redeeming on BA with sky-high fuel surcharges just got hosed again.

  12. Lawyers are greedy. Everyone knows that. I mean everyone. If you disagree you are probably a scumbag lawyer.

  13. Is Lufthansa Miles and More next? Is there any lawsuit against them? They are charging hefty surcharge as well?

  14. @Debit – Jones billed at $700/hour; she also had a team working with her which is how the $47,000 amount was calculated.

    @Jdhogg – I disagree with you, and I’m not a lawyer. Scumbag, I’ll cop to that, though. 🙂

  15. Having been a semi-reluctant BA customer for for 18 years now, I think I’d rather have the cash. As several have mentioned, BA will offset this expense onto their customers as fast as possible, in fact I’d bet that the first meeting BA executives had after the lawsuit was filed was with BA attorneys and the second meeting was with management staff to discuss ways to pass on at least 150% of the potential costs to customers. They would have figured this out a long time ago. BA won’t stop at recovering their costs, they’ll want that plus some for their trouble. It may come in the form of a massive devaluation or, it may be something else, but they are not eating this. I am trying to decipher how much my fuel surcharges have been in recent years, having trouble figuring it from my receipts, but I would not value those miles at anything higher than $0.008/mile for future use.

  16. Another Steve – Don’t be so ridiculous… If BA have identified a revenue stream that could make them tens of millions in additional profit, they’d be taking it regardless of whether they won or lost this case. Just like any rational company would…

  17. @callum – i think you are both agreeing with me that BA will take every opportunity to offset this decision by extracting more revenue from passengers….and simultaneously calling me ridiculous for saying it.

    You are wrong about any rational business following BA’s approach to maximizing revenue though, if you were right we would all be sitting 8 across in business class and paying for water in coach, and we’re not. or at least I’m not, maybe you are.

    Every successful business maximizes revenue, BA just tends to be exceptionally lazy about it. They look at what they are already doing and just tell customers that they need more money for it. The unique position they have in London and on the NYLON route allows them to test the limits of greed and disregard for their customers without suffering much in the way of consequences. And that will continue.

  18. @Another Steve

    Isn’t there an inherent contradiction in your post? On the one hand “if what BA is doing was rational everyone else would do it”; but on the other you describe “the unique position they have in London and on the NYLON route“.

    Well, yes, exactly.

    BA can do it because they have a unique monopoly at one of the world’s busiest international airports which is also one of the aviation world’s biggest generators of premium traffic. Of course very few others can get away with what they do. And that’s why the ME3 major on high service quality – because, frankly, why would most people want to fly via UAE or Qatar if it weren’t made attractive for them to do so?

    Big companies are fundamentally sociopathic: they couldn’t give a toss about anything other than making money. All the brand guff about how deeply they care is just what they say to persuade you to give them your money. They are basically behaving like gold-digging whores: and if to extract maximum cash they have to make you believe that they love you, you should expect roses and doe eyes to swiftly follow.

  19. Asking same question as another follower…any hopes of redeeming these charges if we used AAdvantage awards (not Avios) and paid the absurd fuel surcharges?

  20. @TomSAN
    Does that make up for the hundreds of other times when the lawyers get millions in class-action lawsuits and consumers get nothing? Because the amount is too trivial to divide amongst all the millions of consumers? Or the money gets “donated” to some university (the lawyer’s alma mater)?

  21. @James
    I stand by what I said. Instead of using this as an opportunity to speak of “the hundreds of other times”, that lawyers either did you wrong or didn’t do enough for you, you should acknowledge the obvious: you did nothing (except being wronged) and certain lawyers risked their time and their money to get the victims of the wrongdoing some recompense. Instead, you use it to moan and groan about “lawyers” in THIS case, no less. Who are your enemies here? It might just be the corporate defendant, and not the lawyers who took on all the risk and who got the corporation to make amends for its improper conduct. Unless, that is, you think life is better for you when you feel you have been cheated and are told to pound sand. I just don’t think the same.

  22. So, if I didn’t get an email can I assume I’m not eligible? I did redeem BA miles a couple times during that timeframe, but not on BA flights. I’m sure I paid some fees, but not sure if any of them were called fuel surcharges.

  23. Thanks Lucky! Didn’t receive email and until I saw your post was completely oblivious to this. I got my identified today and was offered 20,000 Avios or $419. Took the dough.

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