By Celeste Bott

Law360 (July 31, 2020, 6:05 PM EDT) -- Mexican airline Volaris shouldn't be allowed to toss a lawsuit from ticket buyers over its cancellation of several U.S. flights to Mexico amid the coronavirus pandemic, the customers argue, because the airline steered passengers to take short-term credit toward future flights instead of offering the required refunds.

The airline filed a dismissal motion last month arguing that the claims in the proposed class action are "undeniably moot" because the company has already been offering refunds or travel credits. In a Thursday response, named plaintiff and Chicago resident Samantha Levey told an Illinois federal court that Volaris deceived some customers into accepting flight credits that expire quickly, causing them to lose the entire value of their tickets since the COVID-19 pandemic is ongoing.

"Volaris' statement [that] it 'instituted a program to offer passengers whose flights had been canceled the option of refunds or electronic credits' is only half true as it was not offering refunds as illustrated by plaintiff's experience," Levey said. "Further, the option of credits highlights the wrongheadedness of its response to class members' demands for the refunds which they are entitled to. The very essence of plaintiff's claim is that she and others were only given credit toward future [flights] despite their demands that their money be refunded."

The "credit" is the precise basis of the lawsuit, Levey argued, saying the airline knew many travelers would be unable or unwilling to travel to Mexico or other international destinations during the short 90-day window provided by the vouchers. Additionally, Volaris, like many airlines, dramatically reduced its schedules in the wake of the public health emergency, she noted.

"Regardless, an electronic voucher is not a refund. Far from mooting plaintiff's claims, Volaris' declaration only confirms the fact plaintiff and other members of the class were ... not given cash refunds as they admit it is required to do," Levey said.

Levey also pushed back on the airline's assertion that the state law claims raised in the lawsuit — accusing the airline of breach of contract, unjust enrichment and unconscionability and a statutory claim under the Illinois Consumer Fraud and Deceptive Business Practices Act — are preempted by the Airline Deregulation Act, a federal law that preempts state common law and statutory consumer protection claims relating to an air carrier's "prices" and "services."

The Airline Deregulation Act doesn't preempt allegations that a carrier violated its own terms, and Levey's suit accuses Volaris of violating its own contract of carriage when it canceled her flight but didn't refund her money, Levey said, citing the U.S. Supreme Court's finding in American Airlines Inc. v. Wolens , which she said created an exception for "routine breach-of-contract claims."

"Indeed, plaintiff's complaint makes no mention of airline prices, routes or service or any state law pertaining to thereto, so there is nothing to preempt as explained below," she said.

And while the airline contended it sent Levey an email letting her know her flight to Mexico was changed to depart from a different airport, and that she missed that flight, she told the court the airline's website updated after that message and showed the flight was canceled.

The proposed class action, filed in April, alleges Volaris quietly canceled several of its U.S. flights to Mexico during the coronavirus pandemic and has unlawfully refused to refund its travelers or let them rebook their flights without penalty.

The suit claims the airline violated U.S. Department of Transportation rules and its own carriage contracts when it refused to reimburse travelers' fares after canceling their U.S. flights to Mexico without warning due to COVID-19.

Levey seeks to represent a nationwide class of travelers who have either been refused refunds or made to pay rebooking penalties in light of their unannounced Volaris flight cancellations. There may be thousands of class members for the suit, and the exact number can be ascertained through the airline's records, the suit says.

Representatives for the parties did not immediately respond to requests for comment Friday.

Levey is represented by William Sweetnam of Keogh Law Ltd.

Volaris is represented by Robert E. Tonn of Holland & Knight LLP.

The case is Levey v. Concesionaria Vuela Compania de Aviacion SAPI de CV et al., case number 1:20-cv-02215, in the U.S. District Court for the Northern District of Illinois.

--Editing by Daniel King.

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