Skiplagged.com Lawsuit - Question for Lawyers

[Smackie Chan]

A 22-yr-old entrepreneur has developed a Web site that exploits a loophole in airline ticketing. Basically, if you want to fly to a particular destination, the site searches for flights that have layovers at your destination, you buy a ticket to the connecting destination that's cheaper than what you could find for where you want to go, then blow off the connecting flight and stay at the layover destination. This only works for one-way flights with no checked luggage. United Airlines & Orbitz are suing the kid for unfair competition. Here's the court filing. Seems kinda frivolous that they'd sue the kid for $75K when airlines are pulling in >$1B just in baggage fees. Do the airlines have a legit case?

Here's the Web site.

[Moving Sale]

How is it more expensive to fly from lax to Omaha than it is to fly from lax to DC thru omaha?

[Smackie Chan]

How is it more expensive to fly from lax to Omaha than it is to fly from lax to DC thru omaha?

I can tell you this - it used to be a helluva lot cheaper to fly cross-country from DC to LAX than it was to fly 60 miles from LAX to Oxnard. There isn't a lot of rhyme or reason to airline ticket prices.

[Mikey]

Supply and demand. Prices for the same seat on the same plane will change from day to day, or even hour to hour (both up and down) depending on what they most need to fill.

If the airlines can play that game why shouldn't their customers? If a legitimate ticket is purchased on a legitimate flight, using their own system, then they should have no complaint. Except of course that they have bought and paid for their government intrusion.

[Screw_Michigan]

I can tell you this - it used to be a helluva lot cheaper to fly cross-country from DC to LAX than it was to fly 60 miles from LAX to Oxnard. There isn't a lot of rhyme or reason to airline ticket prices.

The miracle of the unregulated marketplace!

[mvscal]

... the unregulated marketplace!

Link?

[R-Jack]

How is it more expensive to fly from lax to Omaha than it is to fly from lax to DC thru omaha?

I'd rather shoot myself than ending a plane trip in Omaha, so I'm guessing to keep folks from buying a gun.

[Shlomart Ben Yisrael]

I am not familiar with the Lanham Act or Illinois law, but it is an easy assumption that the airlines have hired some very competent attorneys, and that they have plead a good case that they will likely win.

But they very well may win that battle and then lose the war.

I have never heard of Skiplagged or "hidden city" ticketing before this suit. This suit is drawing attention to facts that won't go away, even if the airlines win the suit.

Someone should have reminded the airlines about the Streisand effect before the suit was filed.

Why is there a pic of a dude fucking a porpoise in your avatar?

[smackaholic]

The best one is the "no weekend stayover" deal where the airlines gouge the fukk out of their sugardaddy, the bidness traveler. Over 20 years ago my company would combat this by buying two round trip tickets with weekend layovers and use 1/2 of each. I suspect that they have cracked down on this game as well by now.

[Smackie Chan]

I am not familiar with the Lanham Act

Now you can be.

it is an easy assumption that the airlines have hired some very competent attorneys, and that they have plead a good case that they will likely win.

After reading the filing, I believe that will be the case as well. While the synopses I've read have focused on the issue being unfair competition, the filing focuses more on breach of contract or agreement and deceptive advertising. I understand why the airlines and Orbitz are pissed, but it's kinda funny to read about how this kid has frustrated them with his use of old & new technology to get over on them so far. He should enjoy it while he can, 'cuz I don't see him winning this. I did some searches on the site to see what kind of fares are available, and you can get some pretty cheap flights using it.

But they very well may win that battle and then lose the war. I have never heard of Skiplagged or "hidden city" ticketing before this suit. This suit is drawing attention to facts that won't go away, even if the airlines win the suit.I have never heard of Skiplagged or "hidden city" ticketing before this suit.

Maybe, but for the average traveler, doing the research to find the kind of discounts instantly displayed using the site's search capabilities would be very time consuming. There's nothing keeping people from doing it now, and greater knowledge of "hidden city" ticketing may result in it being exploited somewhat more regularly, but it won't be nearly as impactful as would widespread use of the site.

the Streisand effect

Had never heard of that, or didn't remember it. Funny stuff. Poor Babs. :doh:

[Screw_Michigan]

I have question along these lines, although its more about hotels. I'm going to be in Philly for a convention in June that runs Th-Sa the second week of June. If I book Th-Su, it is $199 per night. But if I add Wednesday to that reservation, it jacks up my room rate by $30 per night. What gives?

[smackaholic]

I have question along these lines, although its more about hotels. I'm going to be in Philly for a convention in June that runs Th-Sa the second week of June. If I book Th-Su, it is $199 per night. But if I add Wednesday to that reservation, it jacks up my room rate by $30 per night. What gives?

Yet another way they repay bidness traveler dude for his loyalty. Thursday-sunday is unlikely to be bidness travel dude. Notice how you can rent a car over a weekend for about 79 cents a day. Same car gets 50 bucks a day during the week.

[Left Seater]

Hidden city tickets have been around for years. This web site just makes it a crap ton easier to find them.

Here is an example.

Take a person going from LA to DC. There are multiple airlines flying that route non-stop, multiple times a day. The average fare on a nonstop flight in June is about $500. This is because business travelers will pay an extra amount to go nonstop. The same traveler could make a stop between LA and DC in say Dallas or Atlanta and drop that ticket price in half. The cost to move that pax over a connection is higher than on the nonstop flight, but it isn't nonstop and is therefore less desirable to many. It also helps the airline sustain two flights into and out of their hub.

Where hidden city ticketing comes in is the traveler finds anger city beyond DC that the airline flies. Let's say Boston. Now he is connecting thru DC in the airlines eyes. Since this airline also flies between LA and Boston nonstop at a high price the connection thru DC is most likely to be substantially cheaper.

But when dude doesn't fly that second leg, DC to Boston the airline gets pissed and wants the higher fare. They strictly prohibit this practice in their contract of carriage. That reason alone will cause the kid to lose.

[Smackie Chan]

But when dude doesn't fly that second leg, DC to Boston the airline gets pissed and wants the higher fare. They strictly prohibit this practice in their contract of carriage. That reason alone will cause the kid to lose.

They also can't resell the empty seat on the connecting flight because they don't know it's available, which could piss off potential buyers of the seat if the airline believes the flight is full when it isn't, causing some customers to go to another airline not just for that flight, but potentially for future flights as well, costing the airline customer loyalty, goodwill, and repeat business. Also could cause flight delays when the plane is waiting for a connecting passenger who has no intent to board.

[smackaholic]

Smackie,

Airlines oversell every flight they can. There would have to be a lot of people doing this before it would result in empty seats. If it happened a lot, the airlines would just over-over sell.

Seems to me that the airlines could work with this dude. Tell him to give them the list of flights people would deliberately miss and just resell them.

[Smackie Chan]

Airlines oversell every flight they can.

Sure, but that's not the issue here. Ideally, they want to have every flight full and to not have to turn away any customers. While they do oversell certain numbers of seats based on statistical probabilities, not every flight is oversold. If an airline believes it has a full flight when in fact there is a seat (or seats) available, they lose a sale and therefore revenue, as well as pissing off the customers who wanted to get on it.

There would have to be a lot of people doing this before it would result in empty seats.

Not necessarily. This presumes every flight is oversold, which isn't the case.

If it happened a lot, the airlines would just over-over sell.

Again, this assumes demand always exceeds supply, which isn't true. The airline industry is one of the toughest in which to be profitable. Why do you think the major carriers file for bankruptcy every decade or so and look to merge whenever they can? The only domestic carrier that routinely turns a profit every quarter is Southwest. Most lose money. Customer satisfaction and loyalty, on-time performance, ability to sell every seat possible, and getting as much as possible for each seat are crucial in being able to be profitable. When these are threatened, the airlines and their legitimate partners (like Orbitz) tend to get a little bitchy.

Seems to me that the airlines could work with this dude. Tell him to give them the list of flights people would deliberately miss and just resell them.

Not a chance that'll happen. This throws a monkey wrench in all the computations used to maximize sales, profitability, and customer satisfaction, although it sometimes seems they don't give a shit about the last one.