It wouldn’t be a Monday morning without a news article that makes us double take, and today is no exception.
Turns out, Air Berlin is trying to force its customers to pay for flights. To clarify, as in bankrupt and no longer existing Air Berlin, is suing a ‘passenger’ for flights that have been canceled and will never happen.
Who is Air Berlin?
If you are a little of out the loop, Air Berlin was a European carrier that went bankrupt in October 2017. At its peak, they were Germany’s 2nd biggest airline (after Lufthansa) with a fleet over 200 jets. They had a huge route network and flew from Germany all the way to North and Central America.
What is the story?
It begins when a passenger paid for a flight on Air Berlin (with their awesome chase card). They discovered that the airline was going bankrupt and took action to get their money back. They asked Chase to dispute the charge on their behalf and got their money returned. After all, they paid for a service that no longer exists. Case closed right?
The passenger was contacted by Air Berlin’s legal department with a court order to repay $2,200 to Air Berlin, as part of its bankruptcy proceedings. We are not sure if the passenger paid $2,200 to fly on Air Berlin (which would be very expensive for the carrier unless they were flying last minute internationally) but it is believed that the fee also included legal costs and court costs. The funny thing is, Chase, refunded the money to the passenger yet Air Berlin is going after the passenger themselves!
Now, this should be obvious, as the passenger paid for a service that no longer exists, therefore they shouldn’t have to pay. But the fact that the company is bankrupt makes it a little more difficult.
As part of bankrupt protection, companies are allowed to refuse to refund customers. After all, they might have already started investing in that order, have other debtors/investors to repay, or simply don’t have the capital available. This is very much the case for Air Berlin who has not been repaying or refunding any customers left out in the cold. But this customer actually managed to get their money back (via their Chase card) which makes the situation very grey.
Many credit card companies offer a ‘travel insurance’ package that protects customers from travel services going bankrupt, but in this case, it seems that Chase just facilitated a straight refund, and did not repay the customer via their insurance.
Ultimately, that expression comes to mind. “Possession is nine-tenths of the law” as in the customer has their money and they will fight tooth and nail to not give it Air Berlin.
Lastly, the funny thing is that Air Berlin is chasing down any debt they can. They currently are seeking from Etihad $2.2 billion dollars. You would think that they wouldn’t care about such a small amount of $2,200 (exactly 1/100000 of the amount they are suing Etihad) but they do seem pretty desperate.
What do you think? Will they ever see a dime from the passenger or Chase?