uDelta, American, United & Southwest Face Passenger Lawsuits Over Alleged Collusion For Higher Airfaresr

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  (Rachel)

  Following news that the Department of Justice opened an investigation into alleged collusion between major airlines to keep ticket prices high, it was only a matter of time before consumers began filing lawsuit against the major U.S. carriers.

  Two groups of passengers have filed lawsuits against Delta, United, American and Southwest airlines alleging they colluded to keep fares high through a series of mega-mergers, The Hill reports.

  The two lawsuits, filed late last week in Chicago and New York, accuse the airlines of a “conspiracy to fix, raise, maintain, or stabilize prices of airline tickets through a number of mechanisms.”

  “This action challenges a collusion among major airlines to limit routes, information and available seats to keep airfares artificially high,” the New York-based lawsuit states. “Plaintiffs allege that defendants illegally signaled to each other how quickly they would add new flights, routes, and extra seats. To keep prices high on fares, it was undesirable for the defendants to increase capacity.”

  Both suits seek class-action status. The Chicago lawsuit specifically seeks to represent all consumers who purchased tickets for domestic flights from October 1, 2012 to present. That complaint points to the airline industry’s quick and increased consolidation in recent years as evidence of collusion, Bloomberg reports.

  The four airlines named in the lawsuits have undergone major mergers in the last decade and now reportedly account for 80% of all domestic air travel.

  Back in 2008 Delta merged with Northwest Airlines; in 2010 Southwest acquired AirTran; United merged with Continental Airlines in 2012; and American and U.S. Airways finalized their merger in 2013 but have not yet combined all operations.

  “This increased consolidation has hurt airline passengers,” according to the Chicago-filed complaint. “Defendants have, in tandem, raised fares, imposed new and higher fees on travelers and reduced their capacity and service.”

  The New York lawsuit claims that airfares have remained higher despite the fact that costs for airlines have decreased since major mergers began.

  “With suppression of routes, seats, and information, defendants can make even higher profits, because at the same time there has been a massive drop in the price airlines pay for jet fuel, their single highest expense,” the lawsuit states.

  Airlines’ supposed bad behavior began to make headlines in recent weeks after Connecticut Senator Richard Blumenthal sent a letter [PDF] to Assistant U.S. Attorney General William Baer urging the DOJ to investigate possible collusion and anti-competitive actions in the airline industry that could result in higher airfares for consumers.

  Blumenthal cited a recent report which found some airlines plan to cut back on the number of seats offered on certain routes in an attempt to boost profits.

  “In light of the recent unprecedented level of consolidation in the airline industry, this public display of strategic coordination is highly troubling,” Blumenthal stated in the letter.

  And just last week, the DOJ announced it had begun the investigation process, having already requested information from airlines as part of an investigation into “unlawful coordination.”

  While the Dept. didn’t specify which airlines were being targeted, American Airlines CEO Doug Parker sent a message to employees over the weekend confirming receipt of the information request and assuring workers that the company had down nothing wrong.

  “On behalf of your entire leadership team, let me be crystal clear: there has been no illegal behavior on the part of American Airlines,” Parker said in the letter. “We will comply fully with the demands of the [Civil Investigative Demand] and this fact will be proven.”

  Bloomberg reports that Chicago-based United is also complying with the Dept. of Justice’s request for information, but declined to comment on the passenger lawsuits. Delta also declined to comment on the cases.

  Neither Southwest, nor American representatives returned Bloomberg’s request for comment.

  However, industry group Airlines for America tell The Hill that it is “confident that the Justice Department will find what we know to be true: our members compete vigorously every day, and the traveling public has been the beneficiary, as domestic fares are actually down thus far in 2015.”

  Passengers sue airlines over allegations of price collusion [The Hill]
  Top U.S. Airlines Conspire on Prices, Fliers Say in Suit [Bloomberg]

   

  
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by Ashlee Kieler via Consumerist

uSubway Removes “Jared’s Journey” From Website Following FBI Search Of Spokesman’s Homer

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• 

  Subway.com still contains a link to Jared’s section on the site but clicking the link just takes you back to the homepage.

  As you’ve probably heard, the Indiana home of famed Subway spokesman Jared Fogle was searched this morning by FBI investigators and that the search is somehow related to an ongoing child pornography investigation. While the sandwich chain has not said anything publicly disparaging about Jared or the situation, it appears to be distancing itself from Fogle on the Subway website.

  While the Subway.com homepage still has a link to the Jared’s Journey section, in which Fogle detailed how he dropped 200 pounds, going to the link just redirects you to the homepage. [TMZ was the first to report this.]

  On Twitter, Subway is only saying that “We are shocked about the news & believe it is related to a former Jared Foundation employee. We are monitoring the situation closely.”

  The “former Jared Foundation employee” referenced in the Tweet is likely Russel Taylor, the former director of the foundation who was arrested in April on child pornography charges. Fogle and the foundation, which is not directly affiliated with Subway, cut ties with Taylor in the wake of the arrest.

  
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by Chris Morran via Consumerist

uTinder Introduces “Verified” Profiles So You Won’t End Up On A Date With A Poserr

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• A friend of mine once showed me a photo of a guy on Tinder she was supposed go on a date with, and my initial thought was that he looked a heck of a lot like a certain actor I’d seen in various things over the years. But hey, lots of normal people look similar to celebrities, right? Maybe, but why take a chance when you could end up on a date with a total creeper? To that end, Tinder is trying to combat such rampant poserism with its new “verified” profiles.

  While my friend decided against taking the chance that she was actually about to meet a celebrity, there are well-known people out there looking for love in all the digital places, just like us average folks. Tinder’s new verified profile badges work both to help those lovelorn famouses convince potential mates they are who they say they are, as well as keeping others from wondering if the person they’re talking to is a creepy poser or the starting forward for their favorite NBA team.

  Much like Twitter, Tinder’s verified profiles come with a checkmark in a blue circle, indicating that yes, this is [insert name of actor who has invariably been on Law & Order at some point/ handsome NFL quarterback in Wisconsin with eyes like so many pools of star-reflecting, deep blue water].

  Tinder’s verified accounts are available to “notable public figures, celebrities, and athletes,” the company says in a blog post announcing the new feature today. If you’re one of those folks, however, it’s unclear how you earn or prove that you deserve a verified badge.

  Beware, however: Though the system might keep you from dating one kind of poser, there are still plenty of others out there that you just may have to bust for yourself, the hard way. I’m talking to you, fedora guy.

  
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by Mary Beth Quirk via Consumerist

uSears-Affiliated Real Estate Investment Trust Raises $1.6 Billionr

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• 

  (Great Beyond)

  If you’ve always secretly wanted to be the partial landlord of a Sears or Kmart store, you have some unusual and specific life goals. You can also achieve your goal as of this week. The real estate investment trust spun off from Sears Holdings, Seritage Growth Properties, is now selling shares to the public, and the offering has been successful so far, raising more than $1.6 billion.

  Seritage lets the management of Sears do two things: raise some cash to help the retailer, which is still losing money as well as losing Kardashians, and perhaps attract some investors who don’t see the value in Sears, but do see the value in the company’s real estate. Shares were initially offered to current Sears Holdings investors, and are now available on the New York Stock Exchange.

  Some investors and observers, including some shareholders who filed a recent class action lawsuit, have speculated that the company’s long-term strategy involves running a nominal retail business while waiting for the real estate market to turn around.

  Not so, CEO Eddie Lampert says: in a recent statement he explained that the REIT cash infusion will help the company in its journey from being a legacy department store to its future as a “a more asset-light, member-centric integrated retailer.” Sears still trying to run a successful, if slimmed-down, retail business, and that’s why they’re selling real estate as well as closing some stores.

  Seritage Shares Rise in Market Debut, Raises $1.6 Billion in Rights Offering [Wall Street Journal]

  
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by Laura Northrup via Consumerist

uMilitary Personnel Face Student Loan Issues Despite Required Protectionsr

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  (frankieleon)

  The Servicemembers Civil Relief Act (SCRA) provides a number of protections for military personnel and their families when it comes to private and federal student loans. While these benefits aim to alleviate the burden servicemembers face when paying back their educational debts, a new report from the Consumer Financial Protection Bureau shows that many student loan servicers continuously fail to uphold their end of the SCRA requirements. 

  The report [PDF] is based on around 1,300 complaints submitted by servicemembers since 2012 and outlines the numerous challenges they and their families have encountered when trying to work with student loan servicers to obtain protections and benefits afforded by SCRA.

  Protections provided under SCRA include an interest rate cap for men and women in uniform who acquire federal student loan debt before they went on active duty, special loan deferment programs and loan forgiveness for certain federal loans for public service. Additionally, some private student loan issuers advertise loan discharges, deferments and other benefits for military families.

  The report found that despite these requirements, many military members and their families continue to face setbacks when they seek to exercise military protections.

  According to the report the most common complaints involved servicers’ continued mistakes handling servicemembers’ student loan repayments that ultimately resulted in improper denials of legal benefits, negative credit reporting, and shoddy follow-through on legal protections for military families; as well as failure to provide co-signer discharges in the event of a borrower’s death.

  In many instances, servicemembers tell the CFPB that their student loan servicer has failed to process SCRA related requests in a timely manner or didn’t clearly provide information about the application process and its requirements.

  One complaint details a servicemember’s attempt to get his loan servicer to comply with the SCRA.

  “My last communication with them was three days ago during which I was told I’d be receiving a document via email. As of this complaint I have yet to receive it,” he writes. “I can’t continue to fight this when my attention should be on matters that will literally involve life or death decisions.”

  Others report that servicers unfairly sent their loans to collections due to the company’s own errors.

  While SCRA provides military deferment options to some active-duty servicemembers, allowing them to postpone monthly student loan payments, the report found that many servicers failed to process complete requests.

  As a result, borrowers found themselves in delinquency, default and the target of debt collection operations.

  “The Bureau has received complaints from servicemembers who believed they had successfully enrolled in a deferment plan, only to return home to discover that their servicer had failed to defer the loan, which was instead put in default and sent to collections,” the report states.

  Perhaps some of the most frustrating experiences servicemembers reported to the CFPB involved attempts to invoke discharge protections related to disabled veterans and the families of deceased military members.

  Under federal law, veterans with a service-connected disability can seek federal student loan discharge if they received a 100% disability rating from the Department of Veterans Affairs. Additionally, federal law requires that federal student loans be discharged upon the death of a borrower.

  However, these protections don’t always translate to the private student loan realm. In fact, private lenders are not required to offer either a discharge based on disability or death, unless detailed in the initial student loan contract.

  Still, servicemember complaints regarding these issues weren’t just limited to the private student loan sector. In some cases when a loan discharge was processed, servicemembers saw their credit scores plummet as a result of servicers improperly reporting the loan as defaulted instead of discharged.

  As for private student loan discharges, parents of deceased borrowers reported disgust and dismay with servicers after unsuccessful attempts to discharge debts they co-signed for their child.

  In many cases, when a private student loan borrower dies, the debt is passed on to their co-signer, typically a parent.

  Inherited student loan debt has become an issue for parents across the country in recent years. With the average student now graduating with more than $28,000 in loans, families unsuspectingly taking over that debt can face undue financial hardship.

  Such was the case for several military families reporting issues to the CFPB.

  “We heard from military families who requested student loans to be forgiven following the death of their child,” the report states. “Borrowers noted that the process of requesting loan forgiveness was not transparent, varied depending on their servicer or the owner of their loan and, when loan forgiveness was denied, that the criteria used for this decision was never disclosed.”

  According to the CFPB, the issues detailed in its latest report make it clear that servicemembers continue to struggle to obtain the rights they have earned.

  “Our deployed servicemembers should be able to focus on their military mission and spend precious free time talking with loved ones, not wrangling over problems with student loan servicers,” Richard Cordray, CFPB director, said in a statement.

  While the CFPB doesn’t make any recommendations in its report, the Bureau does note that unlike other consumer finance products such as mortgages, there are no comprehensive statutory or regulatory framework that provides uniform standards for the servicing of all student loans.

  However, the CFPB has developed guides for servicemembers with student loans that provide information on various repayment options and answers to frequently asked questions about SCRA.

  CFPB Report Finds Servicemembers Continue To Face Roadblocks From Student Loan Servicers [Consumer Financial Protection Bureau]

  
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by Ashlee Kieler via Consumerist

uGeneral Mills Says It Will Eventually Use Only Cage-Free Eggs In U.S. Operationsr

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  (Dyanna Hyde)

  General Mills is the latest big food company to jump on the cage-free egg bandwagon, announcing today that it’s preparing to make the move to only use eggs from hens that aren’t confined to cages in 100% of its U.S. operations… eventually.

  The company says the move is part of an updated animal welfare policy that now extends throughout its global supply chain, reports Associated Press, but didn’t nail down a date for that change. It’s now working with suppliers to figure out a “reasonable timeline” to execute the plan.

  General Mills uses eggs in many of its products, though some brands like Haagen-Dazs already use not only cage-free eggs, but free-range eggs.

  Animal advocates are praising the company for joining others in treating the animals we use for food with more consideration.

  “General Mills’ announcement is a major victory to improve the lives of farm animals,” Josh Balk, senior director of food policy for the Humane Society of the United States, told the AP.

  The organization worked with General Mills on its new policy, which is based on the British government’s Five Freedoms of Animal Welfare. Those pillars include freedom from hunger, thirst and malnutrition; freedom from discomfort; freedom from pain, injury and disease; freedom from fear and distress; and freedom to engage in normal patterns of animal behavior.

  Walmart adopted a similar policy based on those British precepts in May, while Dunkin’ Donuts also recently said it was looking into cage-free eggs.

  General Mills already held to those principles in regards to its dairy suppliers, but the new policy expands those methods to all animals in its worldwide supply chain, says Steve Peterson, the company’s director of sustainable sourcing.

  The company won’t be cage-free immediately, however, as General Mills needs time to work with suppliers to make sure there are enough ingredients raised in line with the new policy.

  “You just don’t make these transitions quickly,” Peterson adds.

  General Mills plans major move toward cage-free eggs [Associated Press]

  
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by Mary Beth Quirk via Consumerist

uShould We Have The “Right To Be Forgotten” By Google In U.S.?r

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  (saramarie)

  Even those of us who didn’t grow up in the Internet age can still find traces of our much younger selves online, which can occasionally make for a fun trip down memory lane. But not everyone is pleased with the idea that every online mention of their name may be forever etched into Google’s search memory. In 2014, the Court of Justice of the European Union ruled that people have a legal “right to be forgotten” by Internet search engines, requiring Google and others to consider such removal requests from residents of the 28 EU countries. A new complaint filed today with federal regulators is calling for a similar program in the U.S.

  The complaint [PDF], filed with the Federal Trade Commission by advocacy group Consumer Watchdog, argues not just that Google should be honoring “right to be forgotten” requests stateside, but that the company’s refusal to do so is a violation of federal law.

  Section 5 of the FTC Act prohibits unfair and deceptive acts in interstate commerce, and the letter alleges that Google’s behavior with regard to privacy issues is deceptive.

  “The Internet giant holds itself out to be committed to users’ privacy, but does not honor requests that provide a key privacy protection,” reads the petition, citing repeated statements by Google that privacy is “important to us,” that the company is “constantly working to ensure strong security, protect your privacy,” and other similar declarations.

  Consumer Watchdog contends that if Google is indeed so committed to privacy, that it would honor requests from American users to be forgotten by irrelevant or outdated search results.

  “Describing yourself as championing users’ privacy while not offering a key privacy tool – indeed one offered all across Europe – is deceptive behavior,” writes CW’s John Simpson, who also argues that Google’s offering of the forget-me tool to EU users and not U.S. users is an unfair practice int that is “likely to cause substantial injury to consumers that consumers cannot reasonably avoid themselves and that is not outweighed by countervailing benefits to consumers or competition.”

  The letter gives multiple examples of cases where CW believes Google’s failure to forget things has resulted in negative consequences, including: the New York school guidance counselor who was fired from her job after photos of her as a teen lingerie model (a job she’d disclosed when she was hired) surfaced online two decades after they had been taken; a Florida doctor wrongly accused with aggravated assault by a violent boyfriend, but whose mugshot was the top Google result for her name; and the young car crash victim in California whose name brings up grisly, leaked crime scene photos when you search for her in Google.

  CW says it isn’t trying to quash public records or have content removed from websites, but to bring back the long-established notion of “Privacy By Obscurity,” through which normal citizens can get beyond past transgressions by not repeating them and by living normal lives.

  “Before the Internet if someone did something foolish when they were young – and most of us probably did – there might well be a public record of what happened,” writes Simpson. “Over time, as they aged, people tended to forget whatever embarrassing things someone did in their youth. They would be judged mostly based on their current circumstances, not on information no longer relevant… The Digital Age has ended that. Everything – all our digital footprints – are instantly available with a few clicks on a computer or taps on a mobile device.”

  The Washington Post tried to speak to Google about the CW petition, but the company declined to comment.

  Google is not required to grant every removal request. About 41% of such requests were recently granted in the EU, according to the company’s own transparency report.

  While Google does not offer the “right to be forgotten” option here in the U.S., it did recently announce that it will give victims of so-called “revenge porn” a way to remove their images from search results.

  
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by Chris Morran via Consumerist