The federal district court in Atlanta has handed down a $9 million judgment in favor of Delta Air Lines (NYSE:DAL), against unauthorized ticket operations in Texas and Alaska. Delta believes that the damages award is the largest ever granted in a case against frequent flyer ticket brokers.
International Award Travel, whose principal officers are Robert Seward and Keith Haddon of Houston, advertised in newspapers that it buys and sells frequent flyer tickets. International Award Travel purchased frequent flyer tickets and awards from members of Delta's frequent flyer program and transferred them to another ticket broker, World Plus, Inc., whose principal officer is Raejean Bonham of Fairbanks, Alaska. World Plus, in turn, sold Delta frequent flyer tickets to passengers as "discount" tickets.
Delta's frequent flyer program rules prohibit the buying and selling of frequent flyer miles, awards, and tickets. In an earlier order in this case, the court ruled that ticket brokers are not authorized to buy and sell awards or tickets from program members and that any ticket transferred or acquired in this for travel, the airline is entitled to the full, undiscounted one-way fare for the travel measured as if the passenger had bought the ticket at the gate at the time of departure.
Based on the thousands of tickets brokered by the defendants in this case, the court awarded Delta compensatory damages of $9,093,857, plus punitive damages.
Chris Jilek, Delta's director - relationship marketing, stated, "This is an important case from the standpoint of helping Delta's ongoing efforts to ensure our program is more rewarding for our customers who play by the rules. Delta is determined to identify and hold responsible anyone who engages in the fraudulent business of brokering Delta's frequent flyer tickets. The size of the damages award should make clear the risk these individuals are taking and Delta's determination to recover for its injuries. (c)1998 Reuters News Service."