Delta Airlines has agreed to pay more than $27 million in refunds to passengers whose flights the company canceled during the pandemic without providing refunds.
The class-action settlement was agreed upon between Delta Airlines and the plaintiff in May. The division of the U.S. District Court of the Northern District of Georgia in Atlanta granted a preliminary approval for the settlement in June. On Oct. 5, the court granted the final approval, thus allowing the settlement to be carried out. According to the agreement, settlement class members are eligible for $27.31 million from Delta.
The settlement applies to Americans affected by flight cancellations initiated by Delta during the COVID-19 period and who received credits instead of cash refunds from the airline.
Class members are people who bought tickets from Delta for flights between March 1, 2020, and April 30, 2021. There were three conditions to be a class member: Delta canceled the person’s flight, the person requested the refund and didn’t receive it, and the person had at least partial unused credit as of Jan. 13, 2023.
In addition to $27.31 million, Delta will pay 7 percent interest on that amount, $51,300 in litigation costs, $246,465 in settlement administration costs, and $2.28 million in attorneys’ fees. This takes the total amount paid by Delta to $29.89 million.
There were 74,346 eligible settlement class members, out of which 14,096, or about 19 percent, submitted claims to the settlement administrator. The deadline for submitting the claim was Sept. 15.
The court observed that if there were no settlement, the risk that the litigation would be delayed was “substantial,” as Delta has denied any wrongdoing or liability.
“To achieve relief similar to the Settlement Benefits, if Plaintiff were to continue litigating, she would have to overcome the obstacles of obtaining class certification, surviving summary judgment, and winning at trial. Even a successful trial might not yield more favorable results than the Settlement terms already achieved, and recovery might be delayed for years by an appeal.”
“All that is certain is that with continued litigation, the Settlement Class would face a notably longer wait before receiving any potential recovery, if they received any recovery at all.”
Any remaining funds from the settlement will be split equally between Public Justice, a nonprofit legal advocacy, and United Way of Greater Atlanta, a children’s charity.
A Delta spokesperson told Business Insider that “in the settlement agreement from May 2023, Delta does not admit or acknowledge it failed to follow its contract of carriage or that it failed to provide refunds in accordance with its contract of carriage.”
Lawsuit, Refunds
The class-action lawsuit that led to the settlement was filed by plaintiff Angela Dusko in April 2020. At the time, Delta was canceling flights amid the COVID-19 pandemic.
In December 2019, Ms. Dusko bought roundtrip tickets from Delta, paying $2,783.24. The trip was scheduled for March 27, 2020, with the return trip set for April 3.
On March 25, Delta informed Ms. Dusko that the outbound flight was canceled and that it was attempting to rebook tickets. The next day, Ms. Dusko was informed that the tickets had been rebooked for March 28.
The plaintiff called Delta’s customer service and said that she didn’t want the tickets to be rebooked and demanded a full refund for canceling the original tickets.
Customer service denied the request and said that if Ms. Dusko chose not to take the rebooked flight, she would only be entitled to flight vouchers and not a refund.
Airline companies are obligated to provide passengers with refunds when the cancelation of flights is initiated by the airlines. Ms. Dusko filed a lawsuit, which eventually led to the current settlement.
“Delta’s acts described in this Complaint reflect a failure by Delta to perform the promises required by the Contracts in accord with the covenant of good faith and fair dealing,” the lawsuit said.
“Although Delta has canceled thousands of flights, it has failed to provide the cooperation necessary to allow Plaintiff and members of the Class to perform under the contract’s flight cancellation and refund provisions, which provide that Plaintiff and the Class are entitled to refunds if they were not reaccommodated (to their satisfaction) and transported on the next available flight.”
One plaintiff in the case was a teacher who paid $2,400 for nine student flights that got canceled. Another plaintiff spent more than $3,000 on flights to Egypt.
According to the U.S. Department of Transportation (DOT), a consumer is entitled to a refund if “the airline cancelled a flight, regardless of the reason, and the consumer chooses not to travel.” If an airline or a ticket agent refuses to provide the refund, a complaint can be sent to the DOT.
Airlines and agents are required to make refunds within seven business days if the customer paid by credit card and within 20 days in case the payment was made via cash or check.
In November 2022, the DOT announced that airlines paid more than $600 million in refunds to passengers who were owed the refunds because of canceled or “significantly changed” flights.
