Some Airline Ads Mislead Without Lying

It's a typical airline ad. American Airlines promotes its "super summer sale" in daily newspapers: Low one-way fares from $69 (Los Angeles to Reno) to $179 (Los Angeles to 39 Eastern cities), with round-trip purchase. Fifty percent off that for "every child accompanied by an adult. Simply buy your ticket by June 30."

But down in the "mouse print" at the bottom of the page are more requirements: Seven days advance reservation and purchase. Travel only from noon Monday to noon Thursday, stay over Saturday night (different for Nevada and Florida). Only one child per adult.

Even then, the advertised fares "may not be available," or are "subject to change," or "other restrictions may apply." What big print giveth, small print taketh away.

This is odd stuff. No food chain could get away with advertising prime rib at $3 a pound, limited to six roasts per store, available--if at all--only when bought in pairs Tuesday through Thursday afternoons (Wednesday in New York and New Jersey).

No wonder the U.S. Supreme Court just asked the Justice Department for an opinion on whether states have any regulatory authority over airlines. If so, the court could make a decision that could unleash state attorneys general on such advertising practices.

"At the moment, there's nothing we can do," says California's senior assistant attorney general, Herschel Elkins. The federal government has sole jurisdiction through its Department of Transportation, which isn't alarmed by such advertising. Consumers are "used to it," says Sam Podberesky, DOT assistant general counsel. They don't complain to the department. The agency said it received 9,500 consumer complaints last year, a sharp drop from 44,000 in 1987. Less than 1% involved advertising.

Consumers did, however, complain to their state attorneys general their dissatisfaction reaching what the National Assn. of Attorneys General called "crisis proportions." So NAAG formed a task force and in 1987 summed up the problems, including poor disclosure of low-fare restrictions, advertising of one-way fares when round-trip purchase was mandatory and promotion of fares that were "simply not available." It also drew up guidelines for state enforcement.

Some states did start actions against airlines whose ads seemed deceptive under the guidelines or existing state law. Airlines, in turn, sued them on grounds they had no authority. (This legal volleying led to the cases now being appealed to the Supreme Court.)

Other consumer watchdogs wanted to join the action. New York City's Consumer Affairs Department, which tried without much success to book dozens of advertised flights, concluded that "most airline ads" were deceptive, and publicly urged the DOT to "probe and prosecute," or let others do it.

The DOT, sole authority over unfair and deceptive airline practices, claims that it has been active. It has proposed, but not enacted, two rules: mandatory round-trip purchase must be stated in type bigger than mouse print, and any additional fees and taxes not included in advertised prices must be noted, if only in the mouse print. And it filed 50 regulatory cease-and-desist orders since 1984, seven involving fare advertising.

But the number of promotional seats available is not a concern, Podberesky says, "if they state in the ad that seats are limited and not available on every flight." What's more, he says, consumers "can get immediate information over the telephone, instead of having to go three miles to an appliance store" to check it out.

Thanks to small print, airline ads may not technically be deceptive, but they do toy with truth. The industry is very upfront about the elasticity of its offers, admitting that availability is set on an ad hoc basis. No low-fare seats will be sold for a flight that's already selling well, but an empty flight will have more and more available. It's called "yield management"--a get-what-you-can principle allowing airlines to keep their options open right until takeoff, constantly adjusting the number of discount seats.

Everybody does it. And everybody has the same come-ons, including "Take the whole family" (Delta) when it's really one-child-per-adult, and "To get these low fares, just buy your tickets by May 31" (Northwest) when there are many more restrictions. They even have the same prices--right now it's that $179 cross-country (American, Delta, Northwest, Continental). This is now called competition; it used to trigger an investigation.

Some say you can't compare a $300 plane fare to a $3-a-pound roast. Maybe so, particularly since there are laws requiring grocers to stock an adequate supply of advertised specials.

What about mortgages, advertised at 7% interest, available to buyers who'll take a second loan, close escrow on Tuesday and happen to call the particular branch during a week of high deposits? What about cars, advertised at $12,000 for four-door sedans with automatic drive and sunroof, but available only to buyers who'll take possession on Tuesday--if there are any on the lot. Better yet, what about used cars . . .

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