Should a European law protect American air travelers?

Paul Kivett’s plane broke down twice before it could take off from Chicago this summer. He arrived in Paris almost five hours late.

If his had been a domestic flight, then Kivett, an architectural photographer based in Kansas City, Mo., would have been entitled to nothing more than the $15 meal vouchers that American Airlines offered.

But he believed that under a little-known European consumer law adopted in 2004, called EU 261, the airline owed him more: specifically, 600 euros (about $775) cash, the set compensation for a delayed flight.

EU 261 established consumer protections not afforded American air travelers, including compensation for delays, denied boarding and flight cancellations. Airlines have pushed back, interpreting the law as narrowly as possible. In Kivett’s case, for example, American maintained that EU 261 simply does not apply to him.

Kivett was incredulous. “Aren’t they responsible?” he asked me.

We may soon find out. A lawsuit filed this month in a federal district court in Illinois accuses United Airlines of violating EU 261 by failing to compensate passengers whose flights were delayed by more than three hours. It’s the highest-profile effort to date to compel U.S. airlines serving Europe to adopt a more consumer-friendly interpretation of the law.

“United has repeatedly failed to compensate passengers as required,” says Hank Bates, an attorney in Little Rock representing two United passengers whose flights didn’t depart on time this summer. He’s seeking class-action status for the case.

United wouldn’t comment on the pending litigation. But a spokeswoman for A4A, a trade group for the domestic airlines that counts United as a member, said that its carriers follow the law. “As with all consumer protection rules, our members carefully adhere to the requirements of Regulation 261,” she said.

The case in question centers on United Airlines flight 949, which was scheduled to depart from Londonat 12:20 p.m. on July 14, according to the complaint. The flight was canceled at 5:42 p.m., and as a result, the two passengers suing United — James Bergman and Kathleen Lynch — didn’t land in Jackson Hole, Wyo., their final destination, until 24 hours after their scheduled arrival time.

Under EU 261, Bergman and Lynch should have received 600 euros each, the lawsuit says. They did not.

“The entire trip was a nightmare for us,” says Bergman, a Web site editor who lives in London. “The most frustrating thing about the experience was the feeling of being powerless. We’d paid thousands of dollars for our flights, and we had no recourse to collect compensation that we were entitled to under European law.”

The complaint highlights a common problem with Europe’s air travel consumer protections: EU 261 isn’t exactly straightforward. I’ve argued with colleagues about who’s covered under the law and who’s exempt. Inevitably, each debate comes down to the definition of two words: “extraordinary circumstances.” Under the law, an airline can simply say that a flight was delayed or canceled because of extraordinary circumstances to get itself off the hook.

According to EU 261, extraordinary circumstances could include political instability, dangerous weather conditions, security risks, unexpected flight safety problems and labor strikes affecting the carrier. But the law leaves open the possibility that other situations could also qualify. Since 2004, most airlines have maintained that mechanical problems are an extraordinary circumstance, meaning that if a plane breaks down, EU 261 goes out the window.

The European Court of Justice, Europe’s highest court, spoke to that interpretation in 2008, ruling that a mechanical failure can be deemed extraordinary only if it involves an act of sabotage or a recently discovered design defect. Yet American air carriers operating in Europe continue to invoke simple mechanical delays as reasons to evade compensation, especially when U.S.-based passengers are involved.

The EU law is not without other loopholes, which is what prompted attorney Bates to launch a business modeled on several European companies that mediate EU 261-related disputes between customers and airlines. His Web site, Euroflightdelays.com, went live just before Bates sued United. “Passengers on flights covered by the regulation have the right to compensation,” he said.

Interestingly, the usual response from an airline when it’s confronted with a possible violation of European consumer law is to make a compensation offer in hopes of reaching a quick settlement. That’s what happened when Kivett asked American about his Paris-bound flight. “This regulation does not apply when travel is from the USA and the aircraft is operated by an American airline,” a representative wrote. “Nevertheless, as a gesture of goodwill, I’ve sent you and your wife a transportation voucher for $400.”

American air carriers could face a huge bill if they’re found to be in violation of the law, particularly if a court grants class-action status to Bates’s complaint. A simple calculation reveals why. Take the typical number of passengers on an international flight, multiply it by the number of mechanical delays on flights operating in Europe, and you have the makings of a potential blockbuster settlement. Airlines know that their creative definitions of extraordinary circumstances could create a disaster of extraordinary proportions.

Aviation analyst Michael Miller predicted that if Bates wins in court, airlines will pass the expense along to consumers in the form of higher airfares.

Maybe that’s why airlines are reluctant to even talk about EU 261. At least that’s the impression I was given a few years ago, when I visited the headquarters of a major air carrier and happened to walk past a section of the office where claims relating to EU 261 were handled. I asked whether I could speak briefly with the person who manages the department and was told no, the person didn’t want to talk about the law, and no, I couldn’t talk to anyone in that department, and then I was asked to keep walking, please. Indeed, most of the complaints regarding this European law that I ask airlines to review seem to go into a virtual black hole, with the companies saying nothing beyond their pre-written form letters.

No doubt, many airlines know that there will be a day of reckoning when it comes to EU 261. It might come sooner than they think.