US aviation authorities say Air Canada agreed to pay US $ 4.5 million in an out-of-court settlement for failing to promptly reimburse customers after canceling flights amid the COVID-19 pandemic .
The Department of Transportation said the settlement would resolve a lawsuit brought by its aviation consumer protection agency over what it calls Air Canada’s “extreme delays” in reimbursing thousands of consumers. for canceled or modified flights between the United States and Canada.
The settlement – the largest ever obtained by the agency from an airline – is awaiting approval by an administrative law judge.
Earlier this year, the United States Office of Aviation Consumer Protection (OACP) fined Air Canada $ 25.5 million after ruling that the Montreal carrier “illegally failed to reimburse in a timely manner.”
Air Canada sought to dismiss the procedure in June, saying the agency had failed to conduct a “well-reasoned analysis” of the company’s reimbursement regulations and conditions of carriage.
Air Canada said the two sides have now agreed to settle the case without “finding any wrongdoing,” noting that it revised its policy to allow refunds for substantially altered flights 13 months after the start of the pandemic.
“Today, the US Department of Transportation’s OACP holds airlines accountable by ensuring that they treat passengers fairly when flights are significantly modified or canceled,” Deputy Secretary Polly Trottenberg wrote in a statement Monday. .
“The department is committed to protecting airline consumers and ensuring that all passengers receive the timely refunds to which they are entitled. ”
About US $ 2.5 million will be removed from the US $ 4.5 million settlement in recognition of refunds already given to customers on US – Canada flights, the parties said.
The agency revealed last summer that it had received more than 6,000 complaints about refunds since March 2020, with Air Canada the subject of more complaints about this than any other U.S. carrier in less than ‘a month last year.