Lawsuit Seeks Refund for Clear Subscribers

But the lawsuit doesn't address the question of what happens to customer data

By Robert McMillan

July 02, 2009 — CSO —

One week after shutting its doors, airport security provider Clear has been hit with a class-action lawsuit.

The suit, filed against Clear's parent company, Verified Identity Pass, seeks restitution for customers, who were being charged for Clear's services right up to the day the company shut its doors.

The suit was filed Monday in U.S. District Court for the Southern District of New York. It was filed by Schneider Wallace Cottrell Brayton Konecky, a San Francisco law firm that specializes in class-action lawsuits.

Founded in 2005, Clear pre-screened frequent fliers -- taking fingerprints, iris scans and credit information -- in order to give them a fast track through the U.S. Transportation Security Administration's airport screening lines. It operated what's known as a Registered Traveler program in about 20 airports and boasted more than 260,000 customers.

Last Monday, Clear abruptly shut down its kiosks, leaving them unattended and forcing customers to fend with the normal airport security lines.

Clear, which hasn't yet filed for bankruptcy protection, has since told customers that it doesn't have the cash to refund the US$199 annual fee it charged them.

In court filings, lawyers representing the plaintiffs in the class-action lawsuit called this a "cut-and-run gambit," and asked the court to award refunds and punitive damages.

However, the lawsuit doesn't address the biggest concern raised by Clear's customers: What happens to their data?

Clear has said that it will notify users when it deletes their information, but in a note posted to its Web site last week, it also indicated that the data could be sold to another Registered Traveler provider. Such providers are accredited by the TSA.

A Clear representative couldn't immediately be reached for comment.