Monday, November 14, 2011

AMR’s American Eagle Fined $900,000 in First Penalty on Delays

Nov. 14 (Bloomberg) -- AMR Corp.’s American Eagle regional airline was fined $900,000 for stranding passengers on 15 planes for more than three hours on Memorial Day weekend, the first penalty levied under the U.S. tarmac-delay rule.

The rule took effect in April 2010 and subjects airlines to fines of as much as $27,500 per passenger. American Eagle was notified of the penalty, Maureen Knightly, a Transportation Department spokeswoman, said in an e-mail yesterday.

American Eagle’s delays at Chicago’s O’Hare International Airport affected 608 passengers, a Transportation Department investigation found. The carrier, a unit of Fort Worth, Texas- based AMR, was late in using a procedure developed to bring travelers to the gate, the department said in a statement.

“We put the tarmac rule in place to protect passengers, and we take any violation very seriously,” Transportation Secretary Ray LaHood said in the statement. “We will work to ensure that airlines and airports coordinate their resources and plans to avoid keeping passengers delayed on the tarmac.”

American Eagle, in a statement yesterday, attributed the May 29 delays to a weather system and airport congestion. Runways were closed three times that day due to lightning, Tim Smith, an AMR spokesman, said in an e-mail in July after the delayed flights were listed on the Transportation Department’s monthly consumer report.

Passengers Offered Vouchers

No other airlines violated the three-hour delay rule that day, according to department data. AMR’s American Airlines operates a hub at O’Hare.

“American Eagle is absolutely committed to the safety of our customers and employees, and regrets the inconvenience these delays caused,” Eagle Chief Executive Officer Dan Garton said in a statement. “We take our responsibility to comply with all of the department’s requirements very seriously and have already put in place processes to avoid such an occurrence in the future.”

American Eagle must pay $650,000 within 30 days, according to a Transportation Department statement. As much as $250,000 can be credited for refunds, vouchers and frequent-flier mileage awards provided to travelers on the 15 flights on May 29, as well as to passengers on future flights that experience lengthy tarmac delays of less than three hours.

The airline, in its statement, said it apologized to affected customers, offered frequent-flier mileage credit to members and provided vouchers to non-members to use toward future travel.

The tarmac-delay rule was created after incidents in which passengers weren’t allowed to get off planes that didn’t have food, water or working lavatories.

Except for the May 29 incidents, delays of more than three hours almost disappeared after the rule’s implementation until hundreds of passengers sat for hours on planes at Bradley International Airport near Hartford, Connecticut, during a snowstorm Oct. 29. The three-hour rule was expanded to non-U.S.- based airlines in August.

The rule has made it more likely that airlines will cancel flights before delays reach three hours, according to a study released by the Government Accountability Office in September.

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