Here is an extract of a message from 2001:

California Penal Code section §483:

quote:
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Ticket Scalping.
Except as otherwise provided in Section 26002.5 of the Government Code and Sections 40180.5 and 99151 of the Public Utilities Code, any person, firm, corporation, partnership, or association that shall sell to another any ticket, pass, scrip, mileage or commutation book, coupon, or other instrument for passage on a common carrier, for the use of any person not entitled to use the same according to the terms thereof, or of the book or portion thereof from which it was detached, shall be guilty of a misdemeanor.


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Added in 1979.

I stand [somewhat] corrected, though Penal Code Section 483 refers to tickets, not frequent flyer miles. I can see how an airline, or even theoretically an overzealous deputy district attorney, could argue that issuance of an award in another's name from one's own mileage account, in exchange for cash or barter, constitutes "ticket scalping." Without going into the legislative history, however, it would appear that the statute was designed to cover a different social ill than what is at issue here.

The operative terms are "any person . . . that shall sell to another any ticket . . . for passage on a common carrier, for the use of any person not entitled to use the same according to the terms thereof . . . shall be guilty of a misdemeanor."

Several issues come to mind.

"The terms thereof," refers to the terms [contract of carriage] of the ticket, not a frequent flyer program. Perhaps the contract of carriage incorporates the FFP Terms and Conditions. But the operative prohibition seems to be selling a ticket, not issuance of a ticket. In other words, "ticket scalping" seems to connote sale of an already issued ticket, not the [arguably fraudulent] issuance of a ticket to one not entitled to receive it.

Were frequent flyer programs started before or after 1979? This goes to the purpose of the statute, what was intended to be punished.

Again, under the Rule of Lenity the prohibited conduct must be clear and apparent to a reasonable person. How many passengers have ever read the entire Contract of Carriage, available only at airports, etc.? If the statute cannot be reasonably understood to apply to issuance of FFP tickets, as a matter of law, one cannot be prosecuted. However, perhaps my "distinction" between selling versus issuance is too ephemeral, and would not succeed in a Motion to Dismiss.

In practical terms, the reason for a dearth of prosecutions may not be any legal infirmities with the application of the statute to issuance of frequent flyer tickets, as much as "proof problems." There would have to be some showing of intent to sell "for the use of any person not entitled to use the same according to the terms thereof." How many defendants are fully familiar that the FFP prohibition has been incorporated into the contract of carriage (if indeed it has)?

That defense might not work for those readers of this thread who admit to reading the entire C of C or who acknowledge that the FFP T & C have been so incorporated. Perhaps it is plainly done on the back of the tickets? What about e-tickets and the terms we blithely click "ok" to? Will a jury believe someone who claims not to have read them?

While I don't think chances of conviction would be high, either factually nor legally, as an attorney I cannot counsel violations of the law.

Perhaps the airlines are just waiting for a perfect "test case," e.g. a ticket broker, to refer to the District Attorney's Office. Or perhaps they have done research and determined that without proving intent -- mens rea (guilty mind) -- they would be far better off proceeding civilly, where the standard of proof is a "preponderance of the evidence" (50+%) rather than the "beyond a reasonable doubt" standard of a criminal prosecution.

Perhaps some ticket broker will be "made an example of" and then the state of the law as to the validity of a "ticket scalping" prosecution for sale of FFP miles will be made clear.

It is an interesting legal issue. Anyone selling miles would be well advised not to do so in California, or with flights to or from there. Better still, give them away!

Needless to say, I am not undertaking to provide legal advice, or enter into an attorney-client relationship with anyone reading this thread. For questions about a particular situation, consult a lawyer.

The antitrust class action issue, while it may not prevail civilly, could also serve as successful good-faith defense in a criminal case, due to the differing standards of proof, 50% in the civil case versus 95% or whatever "reasonable doubt" is.

Note that by referring to that antitrust case I am conflating legal issues (questions of law) with the evidentiary factual burdens of a criminal prosecution, but it could go to intent.

Not that outlandish intent saves the day in criminal tax prosecutions!

About 3 years ago, I bid on an America West $300 cert.

I got an e-mail from American West's Fraud Dept, that was threatening, etc. Ebay yanked the auction off.

I didn't have an American West FF account. Still don't. I probably would have spent $700 on Am West total, but they lost that revenue.

I have not flown Am West since.

The topic heading is somewhat misleading - it should be modified to reflect that the seller was caught selling American miles. As will be discussed below, most other airlines are not as ruthless as American in pursuing people who sell miles and upgrades.

On average, about 50 Southwest coupons are auctioned on ebay every day. To my knowledge, Southwest does not pursue these people because it has determined that it is better for business not to annoy its best customers.

In addition, there are dozens of ebay auctions each week for upgrade coupons from United, Northwest, Continental and other airlines. Although these certificates cannot - by their terms - be sold for cash, the airlines have apparently decided that it is not worth the trouble to pursue the sellers (no doubt very good customers if they have upgrades to spare).

American Airlines is the exception to the laissez fare rule. I once tried to sell an AA discount certificate (not miles) that I received in the mail through a VISA promotion. Within 1 day, ebay had shut down my auction as a violation of its rules. American apparently believes it is a good use of personnel to monitor ebay for such auctions, and ebay management (who are generally wimpy about such things) has agreed to pull auctions for American. I think that United also monitors mileage auctions but don't have any first-hand experience.

It is not difficult for American to figure out who is selling miles, as ebay has account information for all sellers and apparently is willing to violate your privacy by providing it to American.

So the moral of the story is: Don't sell miles on ebay and don't sell anything that relates to American Airlines.

Delta has a bit of a "reputation" in this arena as well...

Thanks for your reply, 410. And you did confirm basically what I suspected, that you were feeling particularly guilty.

Inane discussions of legality aside, I think it was good you felt guilty when caught, as long as it doesn't continue to dominate your thinking. IMHO, it speaks well of your ethical makeup. And even though I really don't think you did anything truly BAD, you did break the rules, and when caught, you fessed up and even warned others.

Echoing a sensible sentiment from early on in this thread, buying and selling probably isn't worth the risk, or, perhaps, the labor required to mitigate the risk.



[This message has been edited by Rut Dog (edited 04-15-2003).]

A BIT (??????????????!!!!!!!!!!!!!) of a reputation!!

The Delta Revenue Protection Unit could have taken Iraq in 2 days is my guess. http://www.flyertalk.com/forum/smile.gif

The entire Republican Guard would have packed up and gone home if they heard the DL RPU was coming over to have 'a quiet talk'.

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[This message has been edited by ozstamps (edited 04-15-2003).]

Fortunately, Flyertalkers came up with the top 10 ways to avoid harassment by the RPU.

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View from the Wing: A blog about Free Miles and Free Markets

Are you sure that wasn't Dave Letterman last Wednesday? http://www.flyertalk.com/forum/wink.gif

I, too, believe this is a "true" story. I appreciate this individual taking time to tell of his/her experience. Perhaps, it will benefit others. Why do people think they can do something like this and get away with it "forever"?

I was trying to be "polite" and "respectful" of the previous poster's theory.

BTW, I too appreciate the fact that the originating poster brought this story to our attention. It most certainly is true and it is an important warning to those who might try to do the same. NOT judging right vs. wrong-- but rather pointing out that people can and do get caught-- probably far more often that one might think.

I'm certain it's happened to other members (even besides the ones I know it's happened to) and the last thing they felt like doing was posting their story here-- not sure I would either, if it happened to me! It's not really human nature...

FWIW, I do know one FTer that was caught (in pre-Ebay days) selling 4 F awards to Oz.

Thats a dirty rotten malicious rumour and I DENY every word of it. I will give $10,000 to Charity if you can prove it. http://www.flyertalk.com/forum/smile.gif

That's an obscure reference! And remember, in my matter, I'm offering $5000, 8 free AA SWU's and to ban myself from FT for life (w/ no excuses or "comebacks") In any case, I'll match your $10,000. http://www.flyertalk.com/forum/smile.gif