Nothing embarrassing in the least.

NZ knew all of this when it denied the refund claim in the first place. These rules have been in effect since 2011.

By denying claims in the first & second round, NZ probably eliminates well over 90% of those claims as most people figure that the reason provided must be true. For those few who do persist, NZ issues the refund.

What is most embarrassing is that NZ citizens have to look to a US agency for protection for tickets paid for in NZ on a NZ carrier. The failure of NZ to protect its own is the unfair part and it must be remembered that it is only those who had tickets to or from the US or from the EU who have this protection.