CEO Blog

Written by Ravindra Bhagwanani on . Posted in Archives

LH

Lufthansa’s Miles & More program finds itself in unexpected legal troubles, after a member in Germany has started a lawsuit to claim a cash compensation for his outstanding miles, valuing them at 0.3 EUR cents per mile, which is basically the value the program makes directly visible through its non-air redemptions. He bases his claim on a German law, according to which electronic money can be converted into cash, suggesting that miles fall under that definition. This is vehemently denied by Miles & More – but nevertheless it has stopped all international conversion partnerships from other loyalty programs into Miles & More miles without advance warning, including from all hotel programs, but as well from other programs such as the one of Swiss supermarket chain Coop. They could probably support the argument that miles are electronic money. Whether stopping them in some kind of panic mode is though not kind of a confession by Miles & More that the claim is based on valid grounds, will need to be evaluated by German courts. But even if the member wins the case, there are certainly better means to redeem miles in the traditional way – meaning for flights – to achieve a countervalue, which is much higher than 0.3 EUR cents…