Delta sued over refunds for canceled flights

Canceled flights are displayed on an electronic screen inside the domestic terminal at Hartsfield-Jackson International Airport in Atlanta on Tuesday, April 14, 2020. (ALYSSA POINTER / ALYSSA.POINTER@AJC.COM)

Credit: Alyssa Pointer

Credit: Alyssa Pointer

Canceled flights are displayed on an electronic screen inside the domestic terminal at Hartsfield-Jackson International Airport in Atlanta on Tuesday, April 14, 2020. (ALYSSA POINTER / ALYSSA.POINTER@AJC.COM)

A proposed class-action lawsuit against Delta Air Lines alleges the company refused to provide a refund for flights it canceled.

The suit was filed Friday by Delta customer Elliot Daniels against Delta in U.S. District Court in Atlanta and seeks a jury trial.

Similar lawsuits have been filed against United Airlines and Southwest Airlines.

The U.S. Department of Transportation says: "A passenger is entitled to a refund if the airline cancelled a flight, regardless of the reason," if the passenger chooses not to be rebooked.

The DOT also warned airlines in an enforcement notice earlier this month that carriers are obligated to give prompt refunds to passengers for canceled or significantly delayed flights.

“Instead,” the lawsuit says, “Delta represents it will only rebook and/or provide travel vouchers.”

The complaint alleges that was unfair and deceptive conduct by Delta, and that Delta breached its contract of carriage and made a fraudulent misrepresentation to customers regarding their rights to a refund on Delta-canceled flights.

While some travelers have been able to get refunds, others have had difficulty getting their money back.

Steve Berman, an attorney at Hagens Berman representing consumers in the proposed class action, called "Delta's actions in light of the pandemic utterly unacceptable."

As travel plummets due to stay-at-home orders and travel restrictions in response to the coronavirus pandemic, Delta has canceled 115,000 flights this month alone, affecting millions of passengers.

Offering vouchers amid the uncertainty “only underscores its primary focus of profits over people, and we intend to fight for their right to monetary relief. Americans are losing their sources of income at alarming rates. Vouchers just won’t cut it,” Berman said in a written statement.

The complaint notes that Delta is receiving billions in federal aid, "But despite the faucet of taxpayer money that will flow its way, Delta refuses to comply with the law or operate in the interests of its customers," it says.

Millions of people have lost their jobs due to stay-at-home orders and other effects of the coronavirus pandemic. People "need money now to pay for basics like food and rent, not restrictive, temporary credits toward future travel," the lawsuit says.

Daniels, who lives in Maryland, sought a refund from Delta for four tickets booked via for more than $3,000.

After Delta canceled the flights, he filed a request for a refund via Delta’s website on March 18, which Delta denied on April 15, according to the complaint.

Delta said it is reviewing the claims made by the plaintiff in the suit.

“Doing right by our customers through refunds and rebookings has been — and will continue to be — a key focus as we manage through this unprecedented global pandemic,” Delta said in a written statement.

The airline said Saturday afternoon that it did not receive a refund request from the plaintiff until April 15. Although Delta's website says it may take up to 30 business days to process refund requests due to extremely high volume, the airline said it expedited the refund process for the plaintiff and "gladly issued his refund" Saturday — the day after his lawsuit was filed.

The lawsuit alleges that as Delta announced flight cancellations it “took a variety of steps to make it difficult, if not impossible, for consumers to receive any refund on pandemic cancelled flights.”

Instead, Delta wants to retain the money, the suit says, “given the severe economic losses it is incurring related to pandemic flight cancellations.”

Delta said this week it is providing refunds to eligible passengers requesting them after the airline cancels a flight or makes a significant schedule change, and said it processed more than 1 million refunds in March totaling more than $500 million.

Airlines sell tickets for a service they haven’t yet delivered, and the prepayment by customers is counted as deferred ticket revenue. According to a Cowen analyst report this week, Delta had $3.8 billion of deferred ticket revenue on its books as of the end of 2019, a liability that could push down its earnings “as the company is forced to issue refunds to customers who opt not to take vouchers for their canceled flights.”

The lawsuit says Delta is "misleading passengers about their rights by making it difficult to locate information about refunds, refusing refunds, unilaterally providing travel vouchers if a passenger is unable to contact a Delta customer service."

The complaint seeks refunds, punitive damages, attorneys’ fees and an order enjoining Delta from keeping refunds for flights it canceled.