A dispute over frequent-flyer miles and access to customer data is at the center of dueling lawsuits filed over the past two weeks between American Airlines, the dominant airline in Philadelphia, and the Points Guy, a travel website founded by a Bucks County resident.
The Points Guy launched an app last September billed as a “one-stop shop” where consumers can track all their loyalty rewards for airlines, hotels, and credit cards in one place, helping travelers redeem their earned miles.
But American claims the Points Guy uses the airline’s intellectual property unlawfully and wants it to stop. Brian Kelly, CEO and founder of the Points Guy, says consumers should have a choice about how to use their data.
Matters escalated earlier this month when American sent a cease-and-desist letter asking the Points Guy not to collect data related to its AAdvantage members. The Points Guy, or TPG, then filed a lawsuit against American Jan. 11 in state court in Delaware, where American is incorporated. American, in turn, sued TPG and its parent company, Red Ventures, Jan. 18 in federal court in Texas, where the airline is headquartered.
American’s suit accuses TPG and its corporate parent of “essentially free-riding on decades of investment by American” in building up its AAdvantage loyalty program.
The airline says its website use agreement prohibits AAdvantage members from giving account access to “any third party on-line service, including, but not limited to any mileage management service, mileage tracking service, or mileage aggregation service,” and alleges TPG is causing customers to breach that agreement for its own benefit.
“Red Ventures is accessing AA.com and AAdvantage customer account data in a way that does not comply with our standards for use of confidential information,” airline spokesperson Andrew Trull said in an emailed statement. “We have been in discussions with Red Ventures, hoping to amicably resolve the issues, and we were surprised when Red Ventures filed its lawsuit last Tuesday. We take customer data and proprietary information incredibly seriously, and want to make sure it is protected and secure.”
Kelly considers American’s actions “short-sighted,” particularly at a time when the industry is recovering from declines in air travel during the pandemic.
“We believe it’s the consumer’s choice,” said Kelly, who grew up in Jamison and now lives in New Hope. “If our reader wants us to help them look at the big picture and take a trip, that’s a win for the travel industry.”
Describing how the TPG app works in its own lawsuit, the Points Guy says users “provide TPG with their login credentials and authorize TPG to gather their account information and data by accessing the relevant loyalty program websites.”
TPG claims American is “the only major U.S. airline whose loyalty program miles expire,” to the detriment of consumers, while the TPG app helps travelers navigate those deadlines.
American did not comment on that aspect of the suit when asked by The Inquirer.
As Kelly explained it, starting April 1, AAdvantage members’ miles will expire after 18 months of no activity. That said, he noted, it’s “pretty easy to keep them active,” such as by using a credit card linked to the program.
“That’s actually what we educate people on at the Points Guy,” he said.
Kelly started the Points Guy in 2010 and it was acquired in 2017 by Red Ventures, which owns a suite of consumer-facing brands that include Lonely Planet.
According to TPG’s lawsuit, the company’s website has 11 million unique visitors every month, and its app has already been downloaded more than 100,000 times.
Kelly likened the app’s purposes to third-party sites like Mint that allow users to track their bank account activity and personal finances in one spot.
“This is the 21st century,” Kelly said. “Consumers want to access their data in ways that will help them.”