Major airlines sue Biden administration over fee disclosure rule

US President Joe Biden

Major U.S. airlines are suing the U.S. Transportation Department (USDOT) over a new rule requiring upfront disclosure of airline fees, the latest clash between air carriers and the Biden administration.

Airlines for America, along with American Airlines, Delta Air Lines, United Airlines, JetBlue Airways, Hawaiian Airlines and Alaska Airlines, filed suit in the U.S. Fifth Circuit Court of Appeals late Friday, according to a copy of the suit seen by Reuters.

This follows the issuance of USDOT's final rules last month, requiring airlines and ticket agents to disclose service fees alongside the airfare, saying it would help consumers avoid unneeded or unexpected fees.

The airline group said in a statement on Monday the department's rule would confuse consumers and its "attempt to regulate private business operations in a thriving marketplace is beyond its authority."

USDOT said fees for baggage or flight changes "must be individually disclosed the first time that fare and schedule information is provided on the airline’s online platform -- and cannot be displayed through a hyperlink."

The rule requires airlines to inform consumers that seats are guaranteed and that they are not required to pay extra. Airlines must provide the following notice: "A seat is included in your fare. You are not required to purchase a seat assignment to travel."

USDOT also said the rule will end "bait-and-switch tactics some airlines use to disguise the true cost of discounted flights." It prohibits airlines from advertising promotional discounts off a "low base fare that does not include all mandatory carrier-imposed fees."

The airlines' lawsuit calls the rule "arbitrary, capricious, an abuse of discretion and otherwise contrary to law."

USDOT did not immediately comment. The airline group said the "rule is a bad solution in search of a problem."