His Wings Have Been Clipped: How American Airlines Permanently Grounded Him

Frequent flyers are always looking for ways to earn air miles and find the best fare. We spend way too much time searching the internet for the newest deal offered by the airlines.

 The individuals enticed by travel and tourism, and the various communities desiring economic development to attract more tourists, all need funding. Grants are how communities develop tourism initiatives, and for individuals, once upon a time, there was once an unbelievable offering. 

The dream deal of every flier would be the elusive, unlimited first class ticket that allows the holder of this golden ticket to fly anytime, anywhere, for the rest of his or her life. This ticket became a reality in the early 1980s, and was sold by American Airlines as the “unlimited AAirpass”. In 1978, the Airline Deregulation Act became the law and American Airlines was challenged with new competition and lower tickets prices, resulting in a cash loss of $76 million in only 2 years of deregulation.

In response AA CEO, Bob Crandel , agreed to market the unlimited, first class pass at a hefty price of $250,000, probably $600,000 in today’s dollars. The Los Angeles Times featured an article explaining this marketing ploy and explained what happened. Mr. Crandel originally thought that corporations would spend the 1/4 of a million dollars on their top management to be used for business trips. He later admitted that “the public was smarter than we were”.

These passes were bought by individuals, including baseball star, Willie Mays, computer mogul, Michael Dell and Shark Tank star, Mark Cuban, who later said it was one of the best purchases he ever made. That was an understatement.

The name Steven Rothstein is legendary to frequent fliers, because he bought the AAirpass in 1987 when he was only in his mid 30’s for the $250,000 and he also bought a companion pass for $150,000. He used the pass for 21 years and flew over 10 million first class miles, making 500 trips to England alone. He also earned 4,000,000 points as the AAirpass  also earned miles for flying. American Airlines claimed that he cost them over $21 million in lost revenue, and finally revoked it for “fraudulent usage” or “speculative bookings,” or whatever their legal team claimed. Rothstein was a successful stockbroker and investment banker, and a very generous man, giving away the 4 million points he accumulated to friends and family, stranded travelers, and others in need.

He became a celebrity appearing on morning news tv shows and a celebrity at major airports, he was even known by American Airlines CEO. Rothstein told the New York Post, “I would show up and just get a seat.”

He would fly to Paris for a sandwich, fly cross country to see a baseball game, and fly to Caracas when his meeting in Miami was postponed to the next day. He took approximately 10,000 flights, 70 trips to Australia, 120 flight to Tokyo, and 50 trips to Hong Kong.  The airline has revoked numerous lifetime passes and is still trying to revoke the remaining two dozen passes that costs them millions of dollars a year. Obviously, they are not offering this money losing pass anymore, and yes, Mark Cuban still has his.

Rothstein was heartbroken when his pass was revoked at Chicago O’Hare airport. It was December 13, 2008 and he and a companion were boarding a flight when he was presented with a letter informing him that his jet setting life was over. After years of lawsuits, the final court decision in favor of American Airlines ended the matter on September 21, 2012, one day before his 62nd birthday. 

About the Author: Jake Tewel holds a Masters Degree from YU, a wine seller, caterer and a million miler for the past 15 years. Jake is a best friend, great neighbor, your go to travel person, father, grandfather and loving husband. He is now focusing his efforts on heart healthy nutrition, exercise and travel.

%d bloggers like this: