by Alex Palmer | May 31, 2013
An airline loyalty club member will be challenging his frequent flyer program in front of the Supreme Court, and his case is raising eyebrows across the incentive industry.

Rabbi Binyomin Ginsberg had been a member of the WorldPerks Platinum Elite program since 2005, run by Northwest Airlines and subsequently Delta Air Lines after it acquired Northwest in 2008. However, following repeated complaints about his experiences on flights and demands for additional benefits, Ginsberg’s membership was revoked and his miles were withdrawn in June 2008 on the grounds that he was abusing the program.

"You have continually asked for compensation over and above our guidelines. We have awarded you $1,925 in travel credit vouchers, 78,500 WorldPerks bonus miles, a voucher extension for your son, and $491 in cash reimbursements," Northwest wrote in a letter to Ginsberg, a month after revoking his membership, according to court papers. "Due to our past generosity, we must respectfully advise that we will no longer be awarding you compensation each time you contact us."

The letter pointed out that Ginsberg had made 24 complaints in the past eight months, and that nine of these were incidents related to his bag arriving late at the luggage carousel.

Ginsberg has said that as dean of the Torah Academy of Minneapolis, he travels an average of 75 times a year to teach and lecture. He also claims to have made complaints for just 10 percent of his flights. He sued Northwest for $5 million over a breach of contract in January 2009, but the class-action suit was dismissed by a San Diego federal judge in light of the Airline Deregulation Act, and the fact that WorldPerks’ terms and conditions did not require the airline to provide extensive reasons for its decision to terminate a membership.

But a federal appeals court in San Francisco reversed this decision in 2011, pointing out that the deregulation law does not, "immunize the airline industry from liability for common law contract claims." Now the case has moved to the Supreme Court to decide whether Northwest crossed a line in revoking Ginsberg’s membership.

“I’m not a lawyer, but from what I can see, Northwest has the right to revoke the privileges in the fine print of the contract,” said Peter Hart, president and CEO of loyalty firm Rideau Recognition Solutions, who has worked with clients that have had to deal with these types of situations. “It looks like he was taking advantage of the program.”

Hart added that withdrawing Ginsberg’s existing miles does seem like a step too far. He believes that in a case where a member seems to be abusing a program’s terms, the company has a right to discontinue membership, but rescinding points that have already been earned is an unnecessarily harsh step.

“But what bothers me, as a CEO, is what is he saying when he gets to the counter?” said Hart. “You have to protect your employees, and if they are having to deal with the same person over and over, you may need to take a stand.”