Airlines Sue Biden Admin Over Rule Needing Fee Disclosure

Some of the top airlines in the United States are suing the Department of Transportation about a new rule that will require them to disclose airline fees upfront to passengers.

This marks just the next stage in the long fight between major airlines and the Biden administration.

The lawsuit was filed last Friday, according to Reuters, which viewed a copy of the lawsuit. It was filed in the Fifth Circuit Court of Appeals by Alaska Airlines, Hawaiian Airlines, JetBlue Airways, United Airlines, Delta Air Lines, American Airlines and the group Airlines for America.

Southwest Airlines said that it supported the provisions that the DOT put forward. The company decided not to join this lawsuit.

In April, the DOT issued a new rule that requires all airlines as well as ticket agents to disclose the service fees they charge right next to the actual airfare. The government agency said doing so will help consumers avoid having to pay fees that are unexpected and/or unneeded.

In a statement issued on Monday, the group of airlines said the new DOT rule would actually cause a lot of confusion among consumers. It added that the “attempt to regulate private business operations in a thriving marketplace is beyond its authority.”

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

The DOT didn’t comment on the lawsuit or the statement the airlines put out earlier this week. Last month, though, it did say that the rule would end up resulting in consumers paying less in fees when they fly.

According to the agency, consumers overpay a total of $543 million in fees every year. The airlines are gaining this extra revenue from consumers who end up being taken off guard by the fees and “then need to pay a higher fee at the airport to check a bag.”

Most of the top airlines in the U.S. charge baggage fees that are higher if consumers don’t pay in advance or decide until the time of the flight to check a bag. Many of these same airlines increased checked bag fees earlier in the year.

In 2022 alone, airlines collected almost $6.8 billion in total baggage fees. For the first three quarters of 2023, those fees totaled $5.5 billion.

According to the DOT, fees for flight changes and baggage “must be individually disclosed the first time that fare and schedule information is provided on the airline’s online platform, and cannot be displayed through a hyperlink.”

In addition, the agency said this rule would end “bait-and-switch tactics some airlines use to disguise the true cost of discounted flights.”

The rule states that airlines won’t be able to advertise promotional discounts off a “low base fare that does not include all mandatory carrier-imposed fees.”

Airlines must also inform all consumers that their seats are guaranteed once they purchase them, and that they don’t have to pay extra for this. They also have to provide a notice that reads:

“A seat is included in your fare. You are not required to purchase a seat assignment to travel.”