Originally Posted by
yyz_consulted
Interested to hear the forums thoughts!
As has been pointed out upthread, class actions take a long time, but Evolink is working purely on contingency, so there's little downside to any of AC's customers in them pursuing this.
Originally Posted by
Transpacificflyer
Associated with this will be a claim of bad faith. The Airlines persisted in selling airline tickets right up until the Canadian government made its more explicit return to Canada request and moved to stop international flights. This isn't about the stupidity of people who continued to fly. Rather it is about a business decision to keep selling tickets that the airlines were aware that they would not be able to honour. They were gambling with customer funds. The airlines had a duty of care to warn customers as far back as mid February as the pandemic grew that there was a strong likelihood that flights would be cancelled. It was evident this would explode even then. Yes, there was a responsibility of the customers to act in a prudent manner, but the airline industry dropped the ball on this.
It may have been "evident" to you, but the exact extent and consequences were not "evident" to many. Nor are your comments at all relevant to those who purchased tickets before then who now can't get refunds. No one can blame AC for selling me a YYC-NAS ticket for Easter 2020 last August, or a bunch of YYC-YVR trips for Q2/Q3 in December.
Originally Posted by
pitz
Additionally, there is still a decent chance that AC ultimately files for CCAA, in which case, the not refunded tickets would be unsecured claims
No, that's not how it works. If the customer has a right to get a refund from an intermediary, e.g. credit card issuer or travel agent, the consumer doesn't have a claim, the intermediary would have a claim, and that would be subject to the terms of whatever agreement exist between the intermediary (or any further intermediaries) and AC, which may or may not be unsecured.
Furthermore, any tickets/credits that are honoured don't become claims against AC in an insolvency, because AC has fulfilled (or will fulfill) its obligation.
No one can say for sure what would happen to travel credits in an insolvency. It would depend in part on the scope of the problem. If it's relatively small, compared to the other liabilities, they may simply be left untouched rather than having to go through the potentially significant hassle of appointing representation for the holders and dealing with their rights, as well as thorny questions such as whether a haircut should be imposed on amounts charged to cover true 3rd party charges - AIFs, GST, UK APD, etc. It may be less costly to the parties involved to simply leave the travel credits in place.
Originally Posted by
Low Roller
The only people who win in class actions are the lawyers. The defendant takes a huge financial hit which hurts its business (and ultimately its customers). They are usually settled for a portion of the claimed amount and then the lawyers take a huge cut, leaving the plaintiffs in a case like this with very little, after years of waiting. They are usually portrayed as some great win for "the little guy", touting multi-million dollar wins, but this is far from the reality for most plaintiffs.
I generally agree with you. And with settlements like Red Bull and DRAM, sure. But the big difference here is that the harm is relatively identifiable and recent. The DRAM one, in contrast, took place over something like a decade, had an unclear impact on each individual consumer, and given the length of time, it was difficult to calculate what losses had been incurred by any given party. In this case, the amounts are generally much larger, and tickets are sold at most 12 months out (and typically much shorter), so most customers should have pretty good records. And the remedy is pretty clear - AC can simply refund us all our money.
Originally Posted by
robsaw
Somewhat of a false narrative, the objective is to change behaviour more than it is to save all-encompassing net cash costs to consumers. Personally, I think the objectives of the lawsuit are overshadowed by the probability that any sniff of large success by the plaintiffs will lead to immediate bankruptcy protection for AC (and similarly for WestJet or any other Canadian airline subject to a similar suit); if they aren't already there by the time this gets to trial (if ever).
Conserving cash is important, but advance ticket sales aren't nearly as meaningful to AC's balance sheet as you think. At December 31, 2019, AC had $6 billion of cash and $2.94 billion of advance ticket sales. I've already done a more detailed analysis elsewhere.
Originally Posted by
Low Roller
I'm not saying that there shouldn't be a penalty. I guess I would just prefer that it be in the form of government regulation and fines as opposed to a lengthy and unruly process that was designed for the benefit of lawyers (which I used to be BTW).
Write to your MP. Write to Garneau. Write to the CTA. That's what I've done, and have encouraged my non-FT friends to do when they've run in to this issue. The government isn't going to respond to us .....ing on FT, but if enough people start making a stink about this, they might do something. (Which would hopefully ensure that the CTA doesn't allow airlines to file tariffs that don't contain reasonable refund provisions).