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Doing away with "Direct" flights

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I was having trouble assigning E+ seats for the second leg of UA532 (SFO-LGA) in April. When I phoned in the agent also had an issue assigning them but finally fixed it (30 mins on the phone)!

One thing was interesting though, she said "It looks like it's coming through as a direct flight and we're in the process of doing away with those." Does anyone know if there's any truth to this?

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