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Updated: Tuesday, January 24, 2006 10:46 AM


OST-04-18970 - Complaint of Donald Pevsner against Tariff Rule Requiring Non-Flown Mileage Inclusion in Total Mileage Computation for MPM Purposes


Prior Pevsner Petitions and Complaints:

OST-95-623 - Code-Sharing" Practices in Domestic, Overseas and Foreign Air Transportation
OST-95-641 - Deceptive Advertising Practices in Domestic, Overseas and Foreign Air Transportation
OST-95-648 - Usage of Passenger Flight Coupons and Airline Debit Memos or Refusals to Board Passengers
OST-97-2061 - Internet Fare Discrimination by Air Carriers and Foreign Air Carriers
OST-02-11338 - Petition for Rulemaking and Enforcement Proceeding Complaint of Donald Pevsner - Southwest Airlines and Other U.S. Carriers


Complaint of Donald Pevsner against Tariff Rule Requiring Non-Flown Mileage Inclusion in Total Mileage Computation for MPM Purposes

OST-04-18970

August 24, 2004

Complaint of Donald Pevsner against Tariff Rule Requiring Non-Flown Mileage Inclusion in Total Mileage Computation for MPM Purposes

When one takes an air journey in foreign air transportation, a Maximum Permitted Mileage computation is applied to the total ticketed itinerary, pursuant to current IATA Rule §017(c) and companion, individual carrier tariffs on file with the Department. If the MPM is exceeded, surcharges apply in five per cent (5%) increments, up to twenty-five per cent (25%). Mileage excesses above 25% will result in a "fare break", with a resultant total recomputation of the through fare that would otherwise apply. Your Complainant has no problem with this basic practice, as it is equitable to surcharge a through fare due to passenger-selected air itineraries that incorporate extra flown mileage that exceeds the MPM.

However, over a decade ago, IATA decided to change its prior practice so as to arbitrarily include non-flown mileage: usually incurred on so-called "open-jaw" stopovers, where a passenger flies to one stopover city and departs from another on a through ticket. The "open-jaw" between such two cities is filled by either surface transportation or a separately purchased air ticket, at the passenger's sole expense and In addition to the cost of his through ticket.

Counsel: Donald Pevsner, 321-449-0882, donpevsner@aol.com


Complaint of Donald Pevsner against Tariff Rule Requiring Non-Flown Mileage Inclusion in Total Mileage Computation for MPM Purposes

OST-04-18970

September 3, 2004

Re: Letter Confirming Time Extension

This letter is to confirm that your office, with the consent of the complainant, has authorized an extension of time until, October 8, 2004 for answers in the captioned docket.

Counsel: American, Carl Nelson, 202-496-5647, carl.nelson@aa.com


October 8, 2004

Answer of American Airlines

Under the relevant joint carrier tariff and referenced IATA resolution (017 series), passengers on a lengthy and complex itinerary are allowed the benefit of a highly favorable through fare for journeys of up to 29,000 miles (maximum point mileage, or MPM). Mr. Pevsner's itinerary was Orlando-Los Angeles-Auckland-Christchurch-Melbourne-Cairns-narwinperth Singapore-Hong Kong-Sapporo-Tokyo-Chicago-Orlando. However, he chose to arrange his own surface transportation on three of these segments - Auckland-Christchurch, Cairns-Darwin, and Sapporo-Tokyo. He argues that the total non-flown mileage of these three segments - 1,997 - should not be assessed against the allowable 29,000 MPM.

The IATA resolution in issue is well within the statutory requirement of Treasonable prices, classifications, rule, and practices related to foreign air transportation," 49 USC 41501. Because surface sectors included in fares for through air transportation can always be flown, they are included in the price as if they are to be flown. It is wholly reasonable to include the mileage of the unflown sectors in the assessment of the cost of the contract since they always remain "fly-able." The fact that Mr. Pevsner chose not to fly these segments, but to arrange his own surface transportation, is irrelevant.

Counsel: American, Carl Nelson, 202-496-5647, carl.nelson@aa.com


October 8, 2004

Answer of the International Transport Association

Today, the aviation world is different. See DOT Order 99-7-8 which provides that any carrier or travel agent may depart from the provisions of any IATA fare construction rule, including those in the Resolution 017 series, where a different methodology would produce a lower constructed fare. At fares subject to the mileage system, airlines often require the inclusion of the non-flown sector mileage because the passenger retains the option to change his ticket, both before and after travel has commenced, and fly the sector he had originally chosen not to. If the airlines were to amend their practices in line with what Mr. Pevsner has suggested, consumers will in the future be denied this option and the flexibility of their tickets will be limited.

Counsel: IATA, David O'Connor, 202-293-9292, oconnord@iata.org


OST-2004-18970 - Complaint of Donald Pevsner against Tariff Rule Requiring Non-Flown Mileage Inclusion in Total Mileage Computation for MPM Purposes

January 7, 2006

Motion to Expedite

  1. There has been no action by DOT since the last document in this Docket was filed on October 8, 2004.
  2. Petitioner and the general public continue to be victimized by the unjust and unreasonable practice by international carriers of subjecting passengers to a DOUBLE COST for non-flown mileage (surface) sectors in foreign air transportation: ONCE for the mileage NOT FLOWN (which subtracts from Maximum Permitted Mileage, always penalizing passengers who could have flown farther BUT FOR inclusion of the said non-flown mileage), and a second time for the passenger cost in traveling over the same city-pair sector by surface transportation...at the passenger's own, separate expense.
  3. This tariff rule is a vestige of the "old IATA", which used to properly Exclude such non-flown mileage on surface sectors until someone at an IATA Composite Passenger Traffic Conference got greedy several years ago. It is the duty of DOT to correct this nasty rip-off forthwith.

By: Donald Pevsner


OST-2004-18970 - Complaint of Donald Pevsner against Tariff Rule Requiring Non-Flown Mileage Inclusion in Total Mileage Computation for MPM Purposes

January 19, 2006

Answer of American Airlines

American Airlines, Inc. hereby answers the motion to expedite filed by Donald L. Pevsner in this docket on January 10, 2006. For the reasons stated on October 8, 2004 in our initial answer, which we incorporate herein by reference, Mr. Pevsner's complaint of August 25, 2004 is without merit and should be dismissed.

In addition, the motion to expedite erroneously implies that the concept of maximum permitted mileage is akin to a mileage bank account from which the mileage of segments used is deducted from the bank. Rather, MPM is established to account for a range of possible routings, and is more liberal than the linear route maps used for domestic fares. Particular fare products may or may not further restrict the amount of interlining, which may occasionally result from the purchase of additional transportation over a surface segment.

Moreover, the motion to expedite states that inclusion of surface mileage is a recent development in IATA resolutions. To the contrary, inclusion of surface transportation on the mileage of a fare governed by the lATA mileage system has not changed since the approval and implementation of the Neutral Units of Construction fare construction system in 1989.

Counsel: American, Carl Nelson, 202-496-5647, carl.nelson@aa.com


OST-2004-18970 - Complaint of Donald Pevsner against Tariff Rule Requiring Non-Flown Mileage Inclusion in Total Mileage Computation for MPM Purposes

January 21, 2006

Reply of Donald Pevsner

  1. Contrary to the statement alleged in paragraph two of the Answer, the workings of Maximum Permitted Mileage, do function precisely as a "mileage bank."
  2. For example, on Around-The-World published fares offered by the major world airline alliances (Star; OneWorld; et al.), maximum permitted mileages for a given fare level are usually offered in tiers. The Star Alliance RTW fare is offered in three tiers: 29,000 miles, 34,000 miles and 39,000 miles, with ascending fares for each tier. When computing a Star Alliance RTW fare, one adds the mileage for all flown sectors AND FOR ALL NON-FLOWN SECTORS, pursuant to the unjust and unreasonable IATA tariff provision complained-of in this Docket. Very often, from personal experience, the extra mileage incurred by being forced to include a non-flown sector in the overall mileage computation will either force the fare into a higher mileage tier, at a cost of several thousand dollars, or else (much more likely) force a recomputation of the entire itinerary that penalizes the passenger by denying him the ability to fly a sector that would, BUT FOR the unjust and unreasonable IATA tariff provision, fit into the relevant mileage tier.
  3. The same unjust and unreasonable result applies on standard IATA multiple-sector fares that bear a stated base fare for the relevant routing. When the Maximum Permitted Mileage is exceeded, the fare is surcharged in increments of Five Per Cent. Any such surcharges that are incurred as a result of mileage for NON-FLOWN sectors are totally unjustified, and are nothing less than clever larceny by the carriers at issue.
  4. The suggestion, in the Answer of American Airlines, Inc. dated October 8, 2004, that the passenger always has the option to buy individual-sector tickets if he doesn't like the results caused by the aforesaid non-flown mileage tariff provision on through fares with included stopovers is a ludicrous joke. This would be the equivalent of buying a new car piece-by-piece, rather than as an integral unit...thereby quadrupling its price.
  5. Turning back to the January 19, 2006 American Airlines, Inc. Answer, the fact that surface mileage inclusion has been "IATA law" since 1989 does not excuse its noxious presence in 2006. What is relevant is equity plus lawfulness under the Federal statute, not the length of time that this gross inequity and statutory violation has persisted in the airline pricing tariff regime. Prior to 1989, non-flown mileage was NOT included in total MPM computation totals...for decades. This argument must be given the short-shrift that it deserves.

By: Donald Pevsner


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