Avis, Budget Agree to $13M Reward Fee Class Action Lawsuit Settlement

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Rental car companies Avis and Budget have agreed to pay more than $13.7 million in order to settle two nearly identical class action lawsuits that accused the businesses of intentionally hiding travel reward fees.

The reward fee class action lawsuit settlement includes the complaint filed by Avis customer Edward Schwartz as well as the Budget class action lawsuit filed by Daniel and Stephanie Klein.

According to the Avis class action lawsuit, the rental car company discloses numerous fees but omits hidden fees for accruing frequent flyer miles. Schwartz claimed that it’s only after a renter picks up a vehicle that Avis informs of the $0.75 per day reward fee. The disclosure allegedly comes in the form of a document left on the seat of the vehicle as well as on the receipt provided to the driver after the rental has ended.

Schwartz argued that the “disclosure” regarding travel rewards fee on Avis’ website was in fact no disclosure at all, alleging that few if any renters would ever find it. The Avis class action lawsuit won class certification in 2014.

Meanwhile, the Budget class action lawsuit filed by the Kleins alleged a very similar scenario for accruing frequent flyer miles. The plaintiffs state that they too were “wrongly” charged $0.75 per day to obtain the travel rewards from Budget.

Both lawsuits accused the car rental companies of violating the New Jersey’s Consumer Fraud Act and breaching their rental agreements.

According to the preliminary Avis Budget class action settlement, Class Members will have a choice between a discount on future car rentals or a cash pay-out.

If every Class Member in the Avis class action settlement chooses a car rental discount, Avis would pay more than $10.9 million. However, if all Avis settlement Class Members choose cash instead, Avis would be required to pay more than $4.1 million.

Likewise, Budget class action settlement Class Members have a similar option that would require the rental car company to pay more than $2.8 million if everyone chose the discounts or $1.2 million if they choose a cash pay-out instead.

The Avis Budget reward fee class action lawsuit settlement states that this is an “excellent” agreement as it “affords all Class Members a choice of cash or discounts on future rentals, an important option given the very small amounts of money (often, less than $1.00) in dispute for many Class Members.”

According to the Avis Budget class action settlement, the rental car companies also agreed to fully disclose the fees going forward. 

More information about the Avis and Budget class action settlement was not immediately available. Keep checking TopClassActions.com or sign up for our free newsletter for the latest updates. You can also mark this article as a “Favorite” using your free Top Class Actions account to receive notifications when this article is updated.

The plaintiffs are represented by Bruce Greenberg of Lite DePalma & Greenberg LLC, Daniel R. Karon of Karon LLC and Jay R. Faeges of Miller Goler Faeges Lapine LLP.

The Avis Reward Fee Class Action Lawsuit Settlement is Schwartz v. Avis Rent A Car System LLC et al., Case No. 11-cv-04052 in the U.S. District Court for the District of New Jersey.

The Budget Travel Reward Fee Class Action Lawsuit Settlement is Klein v. Budget Rent A Car System Inc. et al., Case No. 12-cv-7300, in the U.S. District Court for the District of New Jersey.

UPDATE: On Mar. 15, 2016, the Avis Budget Frequent Traveler Surcharge Class Action Lawsuit Settlement is now open! Click here to file a Claim Form or visit www.AvisBudgetSurchargeSettlement.com for more details.