TWA Sues Travel Agency Over Bonus Coupon Sales
Trans World Airlines on Wednesday sued a San Diego travel agency that TWA says wrongly sold Frequent Flight Bonus coupons.
TWA said in a lawsuit filed in Los Angeles that the agency, Premier Travel, bought the discount coupons from TWA customers and resold them to Premier Travel customers. TWA said the arrangement violates the rules of the frequent flier program, which forbids the transfer of coupons to third parties.
For the record:
12:00 a.m. May 30, 1986 FOR THE RECORD
Los Angeles Times Friday May 30, 1986 Home Edition Business Part 4 Page 2 Column 3 Financial Desk 3 inches; 77 words Type of Material: Correction
Two men sued by Trans World Airlines for allegedly improper selling of frequent flier coupons are recent graduates of the University of San Diego law school; the school was improperly identified in Thursday’s Times. Also, a statement by one of the men, claiming that the discount tickets were “completely transferable,” was incorrectly attributed to a university press kit; the comment was actually made to a USD spokesman, who reported it to The Times. The firm’s revenue also was misstated; it reportedly has been $1 million a month since December.
Charles Weghorst, manager of passenger sales for the airline’s San Diego district, said TWA has billed Premier Travel for at least $250,000 in TWA tickets but has not been paid. The amount represents the full price of the discount tickets sold by Premier.
Under TWA’s frequent flier program, customers accumulate “points” for each mile that they fly with the airline. The points can be converted into coupons for free or discount tickets. After 50,000 miles, TWA passengers are awarded coupons for free first-class round trips to any TWA destination as well as a first-class upgrade for the price of a coach ticket for a traveling companion.
TWA said that since Jan. 1, the frequent flier coupons have been transferable only to family members. Coupons used before that date were transferable to anyone but could be transferred only once.
TWA alleged in its lawsuit, filed in federal court here, that coupon holders transferred their tickets to Premier or a related agency, the Coupon Bank, and that the agencies, in turn, transferred them to customers. Eric Fuller and Jeff Rooney, the officers of the two companies, were not available for comment Wednesday. The two were graduated from the UC San Diego law school last week.
According to a press kit issued by the university that spotlighted some of its graduates, the two travel companies operated by Rooney and Fuller have generated $1 million in revenue since last December. The press release said that although at least seven other firms specialize in the sale of discount coupons nationwide, Premier claims about half of the market.
The release quoted Rooney as saying that the discount tickets were “completely transferable, according to airline regulations.”
