Fare or not? Spirit sued over fee

In the court of public opinion, the jury is still out on à la carte fees — some folks hate them, others are just resigned to them — but now the issue is going to federal court.

Last week, attorneys filed a class-action suit against Spirit Airlines over the carrier’s Passenger Usage Fee (PUF), a charge of $9–$17 per flight incurred by anyone buying a ticket over the phone or on Spirit.com. Considering that the vast majority of travelers purchase their tickets by those means, the case argues that the charge isn’t an optional fee at all.


“It’s a fare, not a fee,” said Katherine Ezell, a lawyer with Podhurst Orseck in Miami. “Under DOT (Department of Transportation) regulations, you can’t charge a fee for something that is basically a fare.”

The suit covers the period between 2008 and 2011, a timeframe in which the airline earned approximately $142 million from the fee, according to an analysis by NerdWallet.com. At a minimum, some 5 million people have likely paid it, says Ezell, who believes the number could climb as high as 30 to 40 million.

The crux of the issue is what constitutes “optional.” Consider a recent search for a one-way fare from Chicago to Fort Lauderdale, Fla., in mid-September. The results returned an equation that looked like this:

               Our Price             +              Government’s Cut           =              Total Price
               $64.43                  +              $14.36                               =               $78.79

Clicking on the “Base Fare” icon under Our Price reveals a further breakdown as follows:

Flight: $45.58
Unintended Consequences of DOT Regulations: $1.86
Passenger Usage Fee: $16.99

(For those who are curious, “Government’s Cut” is merely Spirit-ese for the mandatory fees and taxes imposed by Washington, which the carrier helpfully calculates as “your government tax rate” – in this case, 22 percent.)

So, is the PUF optional or not? At the bottom of the page, users will see a note that says “Lower fares generally available at the airport,” which Ezell argues doesn’t make the practice any less deceptive.

“Theoretically, you can waste gas, drive to the airport, pay to park, go in and purchase your ticket and not pay it,” she told NBC News. “But they’ve always made a practice of encouraging people to use their website where you can’t avoid it.”

Others point out that the fee is not only optional — inconveniently optional, perhaps, but an option nonetheless — but that it’s also included in the total price, making the issue more or less moot.

“If you’re a consumer, you aren’t going to see this added on after the fact,” said Brett Snyder, who blogs about travel at CrankyFlier.com. “It will be in the total price so it really is a non-issue.”

Spirit, meanwhile, “believes the claims are without merit and intends to defend the case,” said spokesperson Misty Pinson.

This, of course, is not the first time Spirit has been cited for its interpretation of government regulations. In 2009, the carrier was fined $375,000 for multiple violations, including omitting optional fees; in 2011, it was fined $50,000 for deceptive advertising, and in March of this year, a lawsuit was filed in Illinois claiming that the Unintended Consequences fee noted above violated the state’s consumer-fraud laws.

As for the issue of whether the PUF is a fare or a fee, whether it’s optional or not and what constitutes adequate disclosure, resolution will have to wait on the courts. In the meantime, full fare transparency will likely remain a goal rather than a reality.

“Oftentimes and even with the new DOT regulations, fees are still fairly hidden,” said Alicia Jao, vice president of travel media for NerdWallet. “There isn’t enough transparency over airline fees and consumers are being charged more than they should be because they’re unaware.”

Rob Lovitt is a longtime travel writer who still believes the journey is as important as the destination. Follow him on Twitter.

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