American Airlines' disastrous unlimited first class travel pass

Inside American Airlines’ $250,000 lifetime pass: How ticket that granted unlimited first class flights became a DISASTER for airline, after customers including Mark Cuban took thousands of trips and cost company millions

• Launched in 1982, the AAirpass was any traveler’s dream, granting a lifetime of limitless first class travel to the holder, who could add a companion for $150,000
• Customers including billionaire Shark Tank investor Mark Cuban and MLB Hall of Famer Willie Mays took thousands of trips and some saved millions of dollars
• Some holders traveled tens of millions of miles and the most prolific cost AA up to $1 million per year – leading execs to revoke some passes over fraud claims 

It didn’t take long for American Airlines execs to realize that offering a pass which granted unlimited first-class travel for life was a bad idea.

Launched in 1982 as a way to raise quick cash during a company crisis, the $250,000 AAirpass was any traveler’s dream. It allowed limitless first class tickets for the holder, who could fork out a further $150,000 for a companion pass.

Billionaire Shark Tank investor Mark Cuban bought one with his first business windfall. Baseball Hall of Famer Willie Mays snapped up a pass, along with computer magnate Michael Dell.

What AA bosses failed to realize was just how much the few-dozen customers who bought the passes would use them.

One took 16 round-trips to London in just 25 days, worth $125,000. Another racked up 10,000 flights in 25 years. A third took 373 flights in a single year which amounted to 1.46 million miles and would have cost $2.4 million, had they been paying for them like a regular customer. 

From Coach to Private Jet: Mark Cuban’s Lifetime Air Pass Story #investing #markcuban #finance #wealth

Major League Baseball Hall of Famer Willie Mays has an AAirpass for limitless first class travel

Michael Dell, the billionaire founder of the computer firm which bears his name, has a pass

The top-tier AAirpass granted unlimited first class travel for life

As the AAirpass paid for itself several times over – and holders even earned frequent flier miles on their trips – American Airlines footed the bill. Draining cash and desperate to crack down on the scheme, it launched an investigation into the most prolific users.

What followed were accusations of fraud, bitter lawsuits and ultimately, the withdrawal of the scheme.

Now, only a few lucky customers still hold a valid AAirpass.

‘THE PUBLIC WAS SMARTER THAN US’ 

The AAirpass program was launched in 1981 as American Airlines struggled with rampant inflation rates and sought to raise cash.

It offered several tiers to frequent fliers that ranged from limitless travel for several years, right up to a lifetime of first class flights.

The $250,000 price of the top-tier AAirpass is equivalent to about $800,000 today, accounting for inflation. A lot of money, but consider that a last minute first class return from London to New York is around $21,000. Forty of those trips would cover the cost. 

Mark Cuban, the Shark Tank star and owner of the Dallas Mavericks, who bought an AAirpass with his first business windfall, said he ‘went everywhere’ and ‘partied like a madman’

Bob Crandall, AA’s chairman and CEO from 1985 to 1998, told the LA Times in 2012 the company ‘thought originally it would be something that firms would buy for top employees’.

‘It soon became apparent that the public was smarter than we were,’ Crandall admitted.

American no longer sells the AAirpass after it wound up costing the airline millions 

Mark Cuban said getting one was one of the ‘most fun, best business decisions I ever made’.

He bought an AAirpass in 1990 when the combined cost with a companion pass was a reported $600,000. Cuban said in one interview he spent $125,000 for the pass and voucher.

Cuban ‘went everywhere’ and partied ‘like a madman’. The pass carried so much prestige that it reportedly allowed the holder to replace another passenger on a full flight. Cuban is rumored to have had basketball great Magic Johnson bumped off a flight by using his pass.

The entrepreneur calculated the cost of the pass meant he could fly for 12 cents per mile on a lifetime of use. He’s now worth an estimated $5 billion, has his own private jet – and is said to have given the pass to his father or a friend. 

AMERICAN CRACKS DOWN 

Former Bear Stearns stockbroker Steven Rothstein bought his AAirpass in 1987. Already an avid jetsetter, the ticket was a no-brainer. He added the companion pass two years later.

Across a 25 year period, he booked 1,000 first class flights to New York City, 500 each to San Francisco, Las Angeles and London, and hundreds more to destinations like Tokyo, Hong Kong and Sydney.

Steve Rothstein bought an AAirpass in 1987 and the airline estimated it was costing $1 million per year to cover his flights. He later had it terminated over claims of ‘fraudulent use’

Rothstein took relatives away, offered his companion ticket to strangers in the airport, and used it to reserve a seat for his bags – or simply so he didn’t have to sit next to someone else. In total, he clocked up more than 30 million miles – equivalent to more than 40 return trips to the moon.

Texas marketing guru Jacques Vroom bought his in 1990 for $356,000 and also added a companion voucher. 

Vroom racked up more than 40 million miles on the pass. His journeys include round trips to Japan and Europe without even staying the night, cross country flights to visit family for the day and, like Rothstein, he booked trips for strangers.

READ MORE: Travel tips from AAirpass holder who’s flown 23 million miles since buying lifetime ticket: ‘NEVER check a bag and pretend to know the flight attendant’

As Vroom, Rothstein and others gave a new meaning to ‘jet-set lifestyle’, airline chiefs realized the pass had become a very costly blunder.

In 2007, AA launched an investigation into the most prolific AAirpass users, who they estimated cost the company more than $1 million each per year, and zeroed in on Rothstein and Vroom.

Both had their passes revoked for ‘fraudulent use’. AA claimed this included booking onto flights they never intended to take, inventing fake passengers on the companion ticket, or letting others use their AAirpass in exchange for cash.

Rothstein’s pass was revoked on the spot in 2008 when he was ambushed with a letter during check-in at Chicago O’Hare airport which accused him of ‘fraudulent behavior’. He said the decision ‘stole my personality… my love’.

Vroom’s was terminated in a similar manner after he arrived to take a flight from Heathrow Airport in London in 2008.

BITTER LAWSUITS AND THE END OF AAIRPASS

In the face of losing their most treasured possession, Rothstein and Vroom fought back.

Both filed separate lawsuits against American Airlines and argued they hadn’t breached the contracts they signed when they bought the passes. 

Rothstein – whose alleged tricks included booking companion seats for fake people named ‘Bag Rothstein’ for his luggage – claimed all of his bookings were made through AA agents by phone. 

He’d grown so close to some of them that they became friends – even thought he’d never met them in person. 

Tom Stuker, 69, from New Jersey, racked up 23 million frequent flier miles using his AAirpass

Stuker, a married father-of-two, purchased  a lifetime pass with United for $290,000 in 1990. He still holds a valid pass despite other customers losing theirs over fraud claims

‘When I bought the AAirpass, in no uncertain terms, they told me that there was only one rule: I couldn’t give anybody the AAirpass,’ Rothstein said in an article about his AAirpass, written by his daughter, Caroline.

Vroom told the LA Times that he did take money from some companions but it was for ‘his business advice’. 

Lawyers for Vroom and Rothstein argued they didn’t commit fraud and suggested the loose contracts did not prohibit the ways they used the passes.

‘It sure seems like the airline was looking for an excuse to be rid of my client,’ Rothstein’s attorney, Gary Soter, added to the Times.

Not every customer who bought a pass fell foul of their contracts with American.  

American stopped selling the unlimited AAirpass in 1994. Tom Stuker, 69, from New Jersey, racked up 23 million frequent flier miles using his AAirpass and continues to document his journeys on Instragram.

He recently shared his top tips for air travelers – including never checking baggage and pretending to know flight attendants. 

The program continued in other forms for nearly three decades, offering perks and discounts to frequent fliers, before the airline stopped accepting memberships in November 2022.

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