Sabre, Inc. v. Department of Transportation

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 7, 2005 Decided November 22, 2005

No. 04-1073

SABRE, INC.,
PETITIONER

v.

DEPARTMENT OF TRANSPORTATION AND
NORMAN Y. MINETA, SECRETARY OF TRANSPORTATION,
RESPONDENTS

AMADEUS GLOBAL TRAVEL DISTRIBUTION, S.A.,
INTERVENOR

On Petition for Review of an Order of the
United States Department of Transportation

David C. Frederick argued the cause for petitioner. On the
briefs were Kenneth P. Quinn, Richard Liebeskind, Barry H.
Gottfried, Jennifer Trock, and David A. Schwarte.

Sam Kazman and Randolph J. May were on the brief for
amici curiae The Progress & Freedom Foundation, et al.

Paul M. Ruden was on the brief for amicus curiae American
Society of Travel Agents.
 2

Thomas L. Ray, Senior Trial Attorney, U.S. Department of
Transportation, argued the cause for respondents. With him on
the brief were Robert H. Pate, Assistant Attorney General, U.S.
Department of Justice, Robert B. Nicholson and Steven J. Mintz,
Attorneys, Jeffrey A. Rosen, General Counsel, U.S. Department
of Transportation, Paul M. Geier, Assistant General Counsel,
and Dale C. Andrews, Deputy Assistant General Counsel.

David H. Coburn argued the cause for intervenor Amadeus
Global Travel Distribution, S.A. in support of respondents.

Before: ROGERS and BROWN, Circuit Judges, and
WILLIAMS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge ROGERS.

ROGERS, Circuit Judge: Sabre, Inc. petitions for review of
a final rule promulgated by the Department of Transportation
that, as relevant, states that an independent computer reservation
system (“CRS”) not owned by an air carrier or foreign air carrier
is a “ticket agent” as defined within the Federal Aviation Act
(“FAA”), 49 U.S.C. § 40102(a)(45) (2000 and West Supp.
2005), and therefore subject to the regulatory authority of the
Department under FAA section 411, 49 U.S.C. § 41712(a). See
Computer Reservations System Regulations, 69 Fed. Reg. 976,
995-98 (January 7, 2004) (“Final Rule”). Sabre, an independent
CRS unconnected to an airline, contends that it is not a statutory
“ticket agent” and asks that those portions of the Final Rule in
which the Department asserts the authority to regulate
independent CRSs under section 411 be set aside. The
Department responds that the petition should be dismissed
because Sabre has suffered no injury in fact and therefore lacks
standing, and its pre-enforcement challenge to the Department’s
interpretation of its authority is not ripe. Alternatively, the
Department maintains that its interpretation of the statutory
 3

definition, and hence of its authority under section 411, is
consistent with the plain language of the definition or, in any
event, is reasonable.

Although no regulations promulgated by the Department
currently constrain Sabre’s business activity and no relevant
enforcement actions are pending against any independent CRS,
we hold that Sabre has standing in view of the combination of
three circumstances. In the Final Rule, the Department claims
that it has jurisdiction over independent CRSs under section
411; its statements indicate a very high probability that it will
act against a practice that Sabre would otherwise find financially
attractive; and it has statutory authority to impose daily civil
penalties on Sabre for violation of section 411, which the
Department plausibly asserts it may enforce without prior
warning by rulemaking or cease-and-desist order. We also hold
that Sabre’s challenge to the Department’s interpretation of its
authority under section 411 is fit for review based on undisputed
facts, including the risk of incurring civil penalties should Sabre
proceed to implement certain marketing plans. We conclude,
however, that Sabre’s challenge to the Department’s
interpretation of its authority under section 411 lacks merit.
Accordingly, we deny the petition.

I.

Section 411 of the FAA provides:

On the initiative of the Secretary of Transportation or the
complaint of an air carrier, foreign air carrier, or ticket
agent, and if the Secretary considers it is in the public
interest, the Secretary may investigate and decide whether
an air carrier, foreign air carrier, or ticket agent has been or
is engaged in an unfair or deceptive practice or an unfair
method of competition in air transportation or the sale of air
 4

transportation. If the Secretary, after notice and an
opportunity for a hearing, finds that an air carrier, foreign
air carrier, or ticket agent is engaged in an unfair or
deceptive practice or unfair method of competition, the
Secretary shall order the air carrier, foreign air carrier, or
ticket agent to stop the practice or method.

49 U.S.C. § 41712(a) (emphases added). The term “ticket
agent” is defined as

a person (except an air carrier, a foreign air carrier, or an
employee of an air carrier or foreign air carrier) that as a
principal or agent sells, offers for sale, negotiates for, or
holds itself out as selling, providing, or arranging for, air
transportation.

Id. § 40102(a)(45). Upon finding a violation of section 411, the
Department may impose civil penalties. Id. § 46301(a)(1)(A),
(a)(2), (a)(5)(D), & (c).

In 2004, in the Final Rule, the Department removed the
rules that had long governed the CRS industry. Concluding that
“market forces are beginning to discipline the [CRS]s’ prices
and terms for airline participation” and that “the [CRS]s’
competition for subscribers is in large part eliminating contract
provisions that substantially restrict travel agents from using
alternative electronic sources of airline information and booking
capabilities,” Final Rule, 69 Fed. Reg. at 985, the Department
allowed the sunset on January 31, 2004 of its CRS regulations.
Id. at 976. Two of its rules — prohibiting “display bias”1 and

1
Display bias involves the ability of a CRS to affect the
presentation of information in ways that are not readily apparent to the
user, which, in the Department’s view, prejudices airline competition
and causes travel agents to give misleading or incomplete advice to
 5

certain contractual arrangements — were extended for a six-
month transition period beyond the sunset date, until July 31,
2004. Id. (codified at 14 C.F.R. § 255.8 (2005)). In
promulgating the Final Rule, the Department stated that all
CRSs remain subject to Department authority under section 411.
Id. Specifically, even those CRSs that are not owned by
statutory “air carriers” (i.e., “independent CRSs”) are deemed
statutory “ticket agent[s],” and thus remain the subject of
possible Department enforcement actions under section 411. Id.
at 995-998.

II.
Sabre petitions for review of the Department’s jurisdictional
claim in the Final Rule and vacation of that part of the rule.
Sabre contends that the Department’s “novel interpretation” that
independent CRSs are “ticket agents” ignores both the plain
meaning of the statutory definition of “ticket agent” and its own
prior interpretation of that term and rewrites Congress’s purpose
in 1952 when it included “ticket agent[s]” in the scope of section

their customers. 69 Fed. Reg. at 992, 998. The user sees the CRS’s
presentation but does not necessarily grasp the criteria that have
influenced the presentation, such as payments by airlines. The
Department explained:

Display bias is possible because of the way in which [CRSs]
present information on airline service options. [CRSs]
display information on computer screens. Each screen can
display only a limited number of [airline] flights, so a system
must use criteria for ranking the available flights. Display
position is important, because travel agents are more likely to
book the flights that are displayed first.

Id.; cf. United Air Lines, Inc. v. Civil Aeronautics Board, 766 F.2d
1107, 1110 (7th Cir. 1985).
 6

411. Before reaching Sabre’s challenge to the Department’s
interpretation of its authority under section 411, we must first
address the Department’s contentions that Sabre lacks standing
and that its challenge is not ripe. See Steel Co. v. Citizens for a
Better Env”t, 523 U.S. 83, 94-95 (1998). The Department
contends that Sabre lacks standing because Sabre cannot show
that the Department’s conclusion that independent CRSs are
“ticket agent[s]” for purposes of section 411 will cause Sabre
actual or imminent injury, and further that the validity of the
Department’s statutory interpretation is not ripe for review
because no Department rule now restricts Sabre’s business
operations.

A.
Article III of the Constitution limits the role of the federal
courts to decide “cases” and “controversies.” U.S. Const. art. III,
§ 2. To ensure there is a justiciable dispute, Sabre must
demonstrate standing, by showing that (1) it has suffered an
“injury in fact,” that is (a) concrete and particularized and (b)
actual or imminent, not conjectural or hypothetical; (2) the
injury is fairly traceable to the challenged action of the
Department; and (3) a favorable decision on the judicial relief
requested is likely to redress the injury. Friends of the Earth,
Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 180-81 (2000)
(citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61
(1992)). Only injury in fact is in dispute.

The Department takes the position that Sabre offers only
speculation as to whether and how the Department might in the
future regulate independent CRSs under section 411, which the
Department contends is “completely unknown and cannot
constitute a present injury for standing purposes.” Br. of
Respondent at 21-22. The Department maintains that no
relevant legal obligations continue to bind Sabre because it is
unreasonable to assume that the Department would seek to
 7

enforce regulations, such as the prohibition on display bias, that
the Department has specifically allowed to sunset. If the
Department considered such practices to violate section 411 in
all instances, the Department maintains that it would have
preserved or modified these prohibitions. Id. at 22-23. Sabre is
thus, according to the Department, “free to operate its business
as it wishes.” Id. at 26.

We conclude that Sabre has demonstrated a sufficiently
concrete and particularized injury in fact due to the Final Rule’s
immediate impact on Sabre’s ability to make business decisions
about the products it will offer in the market. This comes about
as the result of a combination of three circumstances:

First, in the Final Rule, the Department unambiguously
claims jurisdiction over independent CRSs. It stated that it will
continue to take “appropriate action[s]” under section 411
against deceptive trade practices and unfair methods of
competition by CRSs, irrespective of whether the CRS is
connected through ownership with an air carrier. Final Rule, 69
Fed. Reg. at 991, 998. At oral argument, the Department
acknowledged that its claim of jurisdiction in the Final Rule is
definitive, not tentative.

Second, the Department’s statements, taken as a whole,
indicate a very high probability that it will act against a practice
that Sabre would otherwise find financially attractive, namely
the sale of display bias. In the Final Rule, the Department has
made clear that it strongly condemns display bias while giving
no indication of how the practice would ever be lawful.
Specifically, the Department considers the sale of display bias
to be categorically anti-competitive and unfair, at least under
current market conditions. Id. at 992, 998. It rejects arguments
that display bias may have social benefits, id. at 993, and that
display bias may not be harmful, id. at 992-94. Although the
 8

Department offers some indications that future market
conditions might cause the sale of display bias to become less
pernicious, id., it offers only oblique indications of how that
might be the case, such as when travel agents use the internet to
check the quality of CRS information, id. at 993, and no
indication of how it might become beneficial. “Display bias
does not promote competition on the merits,” the Department
explains, because “[i]nstead, it is designed to suppress
competition by causing consumers and their travel agents to
select inferior airline services over other available services that
would better suit their needs.” Id. at 998; see supra n.1. Thus,
the Department concludes, depending upon market conditions,
CRS biasing may be “unlawful” both under section 411 as well
as section 1 of the Sherman Act, 15 U.S.C. § 1 (2000). Final
Rule, 69 Fed. Reg. at 998. These statements occur in the context
of the Department’s assertion that “display bias has been a
concern since CRSs were first developed,” id. at 992, and that
CRSs “clearly wish to be able to sell bias,” id. at 993.
Third, the Department has the statutory authority to impose
daily civil penalties on Sabre, after notice and an opportunity to
be heard, for violations of section 411 and has asserted, subject
only to the limits of constitutional Due Process, the right to do
so without prior warning, rulemaking, or cease and desist order.
See 49 U.S.C. § 46301(a)(2), (a)(4), (c)(1)(A). Although the
Department’s history of enforcement actions has been premised
on regulatory violations,2 and the Final Rule suggests that the

2
See, e.g., TFI Tours International, Ltd. Violations of 49
U.S.C. § 41712 and 14 CFR 399.84, Order 2004-2-5, 2004 WL
253318 (D.O.T. Feb. 6, 2004); Cheap Tickets, Inc. Violations of 49
U.S.C. § 41712 and 14 CFR 399.84, Order 2002-5-30, 2002 WL
32341086, at *3 (D.O.T. May 31, 2002); Travelocity.com, L.P.
Violations of 49 U.S.C. § 41712 and 14 CFR 399.84, Order
2002-3-28, 2002 WL 32341082, at *2 (D.O.T. Mar. 29, 2002);
Expedia, Inc. Violations of 49 U.S.C. § 41712 and 14 CFR 399.84,
 9

Department might readopt regulations barring display bias, 69
Fed. Reg. at 998, the Department asserted in the Final Rule that
regardless:

[e]ven without specific regulations, any such [anti-
competitive] practices could be unfair methods of
competition and thus unlawful. We retain the authority to
bring enforcement cases against firms that violate the
statutory prohibition.

Id. at 978. As Sabre points out, the Department has taken the
position in another context that, as a matter of its statutory
authority, “a violation of [section 411] may be enforced by civil
penalty as well as by order.” American Airlines, Inc., Docket
OST-2003-15046-18, 2003 WL 23097500, *3 (D.O.T. Aug. 21,
2003).

In light of the Final Rule’s pronouncements, Sabre
realistically expects that its marketing of display bias will be
perceived by the Department as a violation of section 411. Cf.
Clinton v. City of New York, 524 U.S. 417, 432 (1998). In this
context, the declaration in the Final Rule that independent CRSs
are “ticket agents” has immediate, unavoidable implications for
Sabre’s business choices and investments, which constitutes a
sufficiently distinct and palpable injury.

In addition, Sabre has established that this injury is actual,
not conjectual or hypothetical. Sabre has proffered evidence in
a sealed supplemental declaration that confirms the present
existence of marketing plans, which it could otherwise
implement presumably at considerable profit, that might very

Order 2001-12-1, 2001 WL 34371079 (D.O.T. Dec. 3, 2001); Delta
Air Lines Violations of 49 U.S.C. § 41712 and 14 CFR 399.84, Order
97-7-24, 1997 WL 411646 (D.O.T. July 24, 1997).
 10

well result in enforcement actions and consequent civil fines.
The Final Rule does not entail the type of flat prohibition
involved in Navegar, Inc. v. United States, 103 F.3d 994 (D.C.
Cir. 1997), and the threat of future readoption of regulations
prescribing display bias is insufficient to show injury, see La.
Envtl. Action Network v. Browner, 87 F.3d 1379, 1383-84 (D.C.
Cir. 1996). However, the Department’s interpretation of section
411 to cover independent CRSs, combined with a high
probability of adverse government action and exposure to the
risk of penalty without further advance warning, shapes the
competitive environment in the air transport industry by
restricting the willingness of independent CRSs to engage,
notwithstanding deregulation, in certain practices, which may
plausibly be otherwise lawful.

We hold, under these circumstances, that Sabre has
demonstrated, as a consequence of the Final Rule and its status
as an independent CRS, a “sufficient likelihood of economic
injury to establish standing.” Clinton, 524 U.S. at 432; Shays v.
FEC, 414 F.3d 76, 85-86 (D.C. Cir. 2005); cf. Laidlaw Envtl.
Servs., 528 U.S. at 183-84. It is reasonably certain that Sabre’s
business decisions will be affected, see Becker v. FEC, 230 F.3d
381, 387 (1st Cir. 2000); Kenneth Culp Davis & Richard J.
Pierce, Jr., ADMINISTRATIVE LAW TREATISE § 16.4, at 13-14 (3d
ed. 1994), which makes the Department’s claim of section 411
authority over independent CRSs analogous to the adoption of
a general enforcement policy immediately affecting Sabre and
so subject to review. Cf. OSG Bulk Ships v. United States, 132
F.3d 808, 812 (D.C. Cir. 1998).

Finally, Sabre’s petition, which is a challenge to an
administrative rulemaking, falls within the relevant zone of
interests under the Administrative Procedure Act, 5 U.S.C.
§ 702 (2000), and the FAA, and therefore satisfies the prudential
limitations on standing. See Bennett v. Spear, 520 U.S. 154,
 11

162-64 (1997).

B.
A related component of justiciability in pre-enforcement
review of agency action focuses on the timing of judicial review
rather than the parties seeking review. The ripeness doctrine is
designed “to prevent the courts, through avoidance of premature
adjudication, from entangling themselves in abstract
disagreements over administrative policies, and also to protect
the agencies from judicial interference until an administrative
decision has been formalized and its effects felt in a concrete
way by the challenging parties.” Abbott Labs. v. Gardner, 387
U.S. 136, 148-49 (1967). Determining whether administrative
action is ripe for judicial review requires a court to evaluate (1)
the fitness of the issues for judicial decision and (2) the hardship
to the parties of withholding court consideration. Id. at 149.
This court has long understood the approach in Abbott Labs. to
incorporate a presumption of reviewability. See Nat’l Automatic
Laundry and Cleaning Council v. Shultz, 443 F.2d 689, 694
(D.C. Cir. 1971). Thus, the court has “often observed that a
purely legal claim in the context of a facial challenge, such as
[Sabre’s jurisdictional] claim, is ‘presumptively reviewable.’”
Nat’l Ass’n of Home Builders v. U.S. Army Corps of Eng’rs, 417
F.3d 1272, 1282 (D.C. Cir. 2005) (quoting Nat’l Mining Ass’n
v. Fowler, 324 F.3d 752, 757 (D.C. Cir. 2003)); see Nat’l
Automatic Laundry, 443 F.2d at 695. At the same time, a purely
legal claim may be less fit for judicial resolution when it is clear
that a later as-applied challenge will present the court with a
richer and more informative factual record. See Nat’l Park
Hospitality Ass. v. Dept. of the Interior, 538 U.S. 803, 812
(2003); At’l. States Legal Found. v. EPA, 325 F.3d 281, 284
(D.C. Cir. 2003).

Regarding the first prong of the ripeness analysis, Sabre’s
challenge to the Department’s interpretation of its authority
 12

under section 411 presents the court with a purely legal question
of statutory construction. See Abbott Labs., 387 U.S. at 149.
The imposition of section 411 liability creates “adverse effects
of a strictly legal kind,” Ohio Forestry Ass’n., Inc. v. Sierra
Club, 523 U.S. 726, 733 (1998), and so affects Sabre’s primary
conduct. Toilet Goods Ass’n v. Gardner, 387 U.S. 158, 164
(1967). The specific and generally uncontested factual
observations of the Department in the Final Rule — especially
those concerning the ownership, history, and contracting
practices of the CRS systems used to market and sell airline
transportation, see, e.g., Final Rule, 69 Fed Reg. at 979-83, 990-
91 — are sufficient to inform the court of the contours of a
merits decision and further factual development in an as applied
context, for example, would not provide the court with a
significantly richer record.

As regards the second prong of the analysis, while the court
recognizes the possibility of overlap between the injury-in-fact
for purposes of standing and the hardship prong for purposes of
ripeness, Navegar, Inc. v. United States, 103 F.3d 994, 998
(D.C. Cir. 1997); see also Venetian Casino Resort, L.L.C. v.
EEOC, 409 F.3d 359, 366 (D.C. Cir. 2005); Stern v. U.S. Dist.
Court for Dist. of Mass., 214 F.3d 4, 11 (1st Cir. 2000), the court
has — in accordance with the presumption of reviewability —
repeatedly held that absent institutional interests favoring the
postponement of review, a petitioner need not show that delay
would impose individual hardship to show ripeness, see Home
Builders, 417 F.3d at 1282; AT&T Corp. v. FCC, 349 F.3d 692,
700 (D.C. Cir. 2003). The Department has failed to offer
plausible reasons why it has an institutional interest in
postponing review. It refers only generally to the public interest
and judicial economy. Contrary to the Department’s view,
postponing review does not advance the policy of “protecting
courts from adjudicating matters that in fact make no difference
and are a waste of [the court’s] resources.” Amer. Trucking
 13

Ass’ns, Inc. v. ICC, 747 F.2d 787, 789-90 (D.C. Cir. 1984).
Sabre must at present conform its primary conduct to the
Department’s interpretation of “deceptive” and “unfair” or risk
civil penalties. See Home Builders, 417 F.3d at 1283; Nat’l
Automatic Laundry, 443 F.2d at 695; cf. supra Part II.A. The
Department and intervenor Amadeus Global Travel Distribution,
S.A., overread Sabre’s statements in its filings with the
Securities and Exchange Commission; those filings
acknowledge only that deregulation under the Final Rule affords
Sabre “increased flexibility to construct our displays of airlines
services in new ways,” Sabre Holdings Corp., Form 10-K:
Annual Report 10 (Dec. 31, 2003), as distinct from suggesting
that Sabre is not experiencing any burden on its primary conduct
as a consequence of the Final Rule. Although the Department
stated at oral argument that it would have to make new finding
of market conditions before it could conclude a practice violated
section 411, it did not dispute that, as in a typical antitrust case,
it could make an after-the-fact finding of market conditions.

From the court’s perspective, pre-enforcement review of
jurisdictional challenges serves a distinct purpose. “In our
overall pattern of government the judicial branch has the
function of requiring the executive (or administrative) branch to
stay within the limits prescribed by the legislative branch.”
Nat’l Automatic Laundry, 443 F.2d at 695. Unlike the challenge
in National Park to an agency’s interpretation of a statute it did
not administer, 538 U.S. at 807, where the Court seemed to find
the regulation’s impact murky and remote, id. at 810, and
concluded that consideration of the merits was premature in
light of possible permissible applications of the agency’s
interpretation, id. at 812, Sabre presents a facial jurisdictional
challenge to the Department’s interpretation of statute that the
Department is charged with administering, and the impact of the
Final Rule on Sabre’s business strategy seems clear and
relatively imminent. Cf. Abbott Labs., 387 U.S. at 154.
 14

Although Sabre remains subject to the authority of the Federal
Trade Commission to regulate unfair and deceptive trade
practices, 15 U.S.C. § 45 (2000), the Commission’s authority is
not necessarily similar in scope to that of the Department, see
United Air Lines v. Civil Aeronautics Bd., 766 F.2d 1107, 1112
(7th Cir. 1985) (citing Magnuson-Moss Act of 1975 and the
Federal Trade Commission Improvements Act of 1980); H.R.
Rep. No. 98-793, at 5 (1984), as reprinted in 1984 U.S.C.C.A.N.
2857, 2861, and the Department has a distinct viewpoint and
policy agenda with regard to display bias in policing anti-
competitive, deceptive, and unfair practices in the air
transportation industry.

Therefore, because the Department’s jurisdictional claim is
sufficiently crystalized for judicial review and neither the
Department nor the court has a significant interest in delay, we
hold that Sabre’s challenge to the Department’s claim of section
411 jurisdiction over independent CRSs is ripe.

III.
In the Final Rule, the Department observed that in adding
the term “ticket agent” in section 411 Congress intended the
definitional phrase “as principal or agent” to ensure that all
persons conducting the listed functions were covered, and
concluded that independent CRSs operate as principals in the
offering for sale and arranging for air transportation inasmuch
as “they act as independent firms that are involved in the
distribution of airline services.” 69 Fed. Reg. at 996. It
followed that because the independent CRSs are “ticket
agent[s],” the Department has authority over them under section
411. Id. at 998.

Sabre contends that the Department’s identification of
independent CRSs as statutory “ticket agents” is invalid because
this interpretation is incompatible with the plain language of the
 15

statute. Maintaining that independent CRSs do not act as
“principals” in arranging for air transportation, nor are they
authorized “agents” of air carriers, Sabre revives the contention
rejected in the Final Rule that independent CRSs are simply
information intermediaries who provide fare, route, and seat
availability data to travel agents, who then book and sell tickets.
Id. at 996. According to Sabre, the legislative history indicates
that Congress was concerned only with regulating as principals
“ticket agents” who held themselves out to the public as air
carriers and misrepresented themselves in the fraudulent sale of
air transportation, and this meaning is reflected in precedent of
the Civil Aeronautics Board (“CAB”), which is the
Department’s predecessor in this regulatory arena, see Civil
Aeronautics Board Sunset Act of 1984, Pub. L. 98-443, 98 Stat.
1703 (1984).

Under the familiar two-step analysis of Chevron U.S.A.,
Inc. v. Natural Resources Defense Council, 467 U.S. 837, 842-
45 (1984), if the statutory language is clear, “the court must give
effect to the unambiguously expressed intent of Congress,” id.
at 842-43. If the court concludes the statutory language is silent
or ambiguous, then, under the second step, the court must
sustain the Department’s interpretation of a statute it
administers, as developed in a rulemaking, if it is “based on a
permissible construction of the statute.” Id. at 843. Whether the
Department is correct in urging that its interpretation of “ticket
agents” is consistent with the literal terms of the statute, there
can be no serious argument that the Department’s interpretation
is impermissible. Neither the plain language of the statute, nor
the holding of any court, nor any unexplained change in agency
precedent prohibit the Department’s interpretation. The fact that
Congress may not have foreseen current developments in the
CRS industry does not demonstrate, as Sabre implies, that the
Department’s construction is invalid. See Pennsylvania Dept.
of Corrections v. Yeskey, 524 U.S. 206, 212 (1998); Chevron,
 16

467 U.S. at 843-44; cf. Barnhart v. Walton, 535 U.S. 212, 220
(2000).

There are three conditions compounded in the definition of
“ticket agent.” A statutory “ticket agent” is a “person” who, (1)
either “as a principal or agent,” (2) “sells, offers for sale,
negotiates for, or holds itself out as selling, providing, or
arranging for,” (3) air transportation. 49 U.S.C. § 40102(a)(45).
The Department reasoned, citing the common meaning of “sell”
and “offer,” that CRSs sell and offer for sale air transportation
as principals because they “present the travel agent with air
service options that the agent can purchase through the system”;
each system “enables the travel agent to book the seat and pay
for it on the customer’s behalf by entering specified keystrokes”;
and when the travel agent follows the applicable procedures,
“the airline is obligated by its contract [with the system] to
accept the booking as valid, whether or not any record of the
transaction appears in the airline’s internal reservations system.”
Final Rule, 69 Fed. Reg. at 996.

Sabre maintains that by construing “ticket agent” to reach
independent CRSs, the Department’s interpretation reads out of
the definition the restrictive clause “as a principal or agent,”
because the term “ticket agent” under the Department’s
interpretation covers all parties involved in selling, offering for
sale, or arranging for air transportation, no matter what status
they have or tasks they perform. This is not true: Congress’s use
of “principal” and “agent” in the disjunctive does not necessarily
indicate that Congress intended to limit the broad applicability
of the two words. Legislative drafters often use apparently
redundant language in order to emphasize that a broad
delegation may not evaded so as to frustrate a statute’s purpose.
Cf. Shook v. District of Columbia Fin. Responsibility and Mgmt.
Assistance Auth., 132 F.3d 775, 782 (D.C. Cir. 1998). The
legislative history illustrates these points and also undercuts any
force in Sabre’s attempt to limit the meaning of “principal” or
 17

“agent” to agency law. Congress was concerned about
deceptive sales practices by entities that were not already subject
to federal regulation, see H.R. Rep. 82-2420, as reprinted in
1952 U.S.C.C.A.N. 2158, at 2162-63, and that were neither air
carriers nor the fiduciary agents of either carriers or travel
customers, but which presented themselves either as the
merchants or brokers of travel services, or as carriers
themselves, see id. at 2158-59. Rather than suggesting that
Congress had agency law in mind when it amended section 411
to add the term “ticket agent,” the history indicates that
Congress used both “principal” and “agent” in order to cover all
intermediary entities that hold themselves out as “selling,
providing, or arranging for air transportation.” Id. at 2158-63.
Thus, the Department could permissibly identify an independent
CRS as a “principal or agent” in the broad sense of a travel
intermediary.

Although Sabre protests that it is not selling air
transportation but only selling “information, communications,
and data processing” to airlines and travel agents, Br. of
Petitioner at 27, the Department also could reasonably conclude
the independent CRSs do more. Final Rule, 69 Fed. Reg. 996.
As Intervenor Amadeus points out, CRS contracts with airlines
“authorize CRSs to display their services for sale, confirm
reservations, price itineraries, accept payment information,
process credit cards authorizations, provide e-ticketing
information, and physically issue tickets on their behalf.”
Amadeus Reply Comments at 34-35, In the Matter of CRS
Regulations; Statements of General Policy, Docket No. OST-97-
2881 et al. (D.O.T. June 9, 2003). Most significantly, CRSs are
not paid for providing information but for making bookings, i.e,
for selling airline inventory. American West Comments at 12,
In the Matter of CRS Regulations; Statements of General Policy,
Docket No. OST-97-2881 et al. (D.O.T. March 17, 2003). Most
of the CRSs’ revenues come from payments made by airlines for
individual bookings. See Notice of Proposed Rulemaking
 18

(“NPRM”), 65 Fed. Reg. 45,552, at 69,370 (2000); Final Rule,
69 Fed. Reg. at 995. In addition, under productivity pricing
arrangements between CRSs and many travel agencies, the latter
obtain incentive payments from the CRS (or pay penalties)
based on meeting (or not) a monthly booking quota. Id. at 997.
The CRSs also charge airlines for booking records made by
travel agents that do not involve any communication with an
airline’s internal reservation system. NPRM, 65 Fed. Reg. at
69,400; Final Rule, 69 Fed. Reg. at 997.

Because the statutory definition does not require that a
ticket agent offer to sell air transportation directly to the public,
id. at 996, the Department could reasonably conclude that
Sabre’s offerings to travel agencies satisfy the holding-out
requirement, see United Air Lines, 766 F.2d at 1113 (citing
Great Lakes Airlines v. United Overseas Airlines, 34 C.A.B. 59,
61, n.7 (1961)); Carrier-Owned Computer Reservations
Systems, 49 Fed. Reg. 32,540, at 32,548 (Aug. 15, 1984). Also,
the Department could reasonably characterize travel agents as
agents for their traveling customers, not just as the agents of air
carriers. Travel agents not only follow their traveling
customer’s directions in booking airline tickets, they obtain
much of their compensation from their customers, not from
airlines. See, e.g., National Comm’n to Ensure Consumer
Information and Choice in the Airline Industry, Upheaval in
Travel Distribution: Impact on Consumers and Agents at 22-24
(Nov. 13, 2002) (final report). Further, the Department did not
unreasonably expand the meaning of “ticket agent” by equating
“arrange” with “enable,” but, in interpreting the definition, it
placed limits on the entities covered in terms of the activities
that Congress listed. The Department expressly avoided
claiming jurisdiction over firms that provide only information
on airline services, Final Rule, 69 Fed. Reg. 996, or firms that
provide a link to sites where bookings could be made but do not
provide a booking function and charged no airline fees, id. at
1002. Sabre’s position that independent CRSs are like
 19

newspapers, which provide a forum and marketplace for sales
and purchases of goods and services, ignores that newspapers
neither sell the merchandise they advertise nor charge their
readers or advertisers fees when a reader makes a purchase as a
result of a newspaper advertisement. An independent CRS, in
contrast, obtains most of its revenue from fees imposed on
airlines when a travel agent uses a CRS to make a booking.

Sabre’s reliance on United Air Lines is unavailing. In that
1985 case, the Seventh Circuit observed that the CAB has no
regulatory authority over independent CRSs not owned by
airlines. United Air Lines, 766 F.2d at 1110. This was dictum;
indeed, it was insignificant dictum. The issue of independent
CRSs was not examined in that case, and the court’s comment
was in reference to a form of CRS that has now, in all
probability, been superceded by new technologies and forms of
business organization.

As to Sabre’s contention that the Department’s
interpretation of the term “ticket agent” is contrary to agency
precedent, it is true that the definition as now codified and the
relevant language of section 411 have remained largely
unchanged since 1952.3 However, the nature of the CRS

3
Section 411 was first enacted in 1938 and did not apply to
“ticket agent[s]” but only to “air carrier[s].” See Civil Aeronautics
Act of 1938, ch. 601, § 411, 52 Stat. 973, 1003 (1938). In 1952,
Congress amended section 411 to prohibit unfair and deceptive trade
practices by “ticket agent[s].” See An Act to Amend the Civil
Aeronautics Act of 1938, Pub. L. No. 82-538, 66 Stat. 628 (1952).
The current definition of "ticket agent" in 49 U.S.C. § 40102(a)(45)
differs only in unimportant ways from the definition enacted in 1952,
which read:

“Ticket agent” means any person, not an air carrier or a
foreign air carrier and not a bona fide employee of an air
 20

industry has changed. When the CAB first promulgated rules to
regulate CRSs in 1984, see Carrier-Owned Computer
Reservations Systems, 49 Fed. Reg. 32540 (1984), all CRSs
were controlled by air carriers, which were subject to regulation
under section 411, Final Rule, 69 Fed. Reg. at 995. Today there
are four CRSs operating in the United States. Three of these
systems — Sabre, Galileo, and Worldspan — are not owned in
any part by air carriers. Sabre was sold to public investors in
2000. See NPRM, 65 Fed. Reg. at 45,552. Amadeus, the forth
CRS, is partially owned by foreign air carriers and has a
relatively small share of the U.S. international travel market. Id.
Sabre’s CRS accounts for about one third of a typical airline’s
revenues. Final Rule, 69 Fed. Reg. at 987. In view of the
significant changes in the industry, especially with regard to
ownership and control over the major CRSs, prior CAB rulings
provide no controlling guidance because they examined
different questions and thus do not affect what is a
straightforward question of statutory construction. For the same
reason, Sabre’s contention that the Department’s interpretation
of its authority under section 411 is an unexplained change in
agency precedent is without merit. The agency precedent cited
by Sabre — Southeast Agency, Inc., 25 C.A.B. 89 (1957), and
Airline Reservations, Inc., 18 C.A.B. 114 (1953) — held only
that a firm that sold tickets while falsely holding itself out as an
airline was a ticket agent acting in violation of section 411; these
orders did not hold, nor suggest, that persons would be ticket

carrier or foreign air carrier, who, as principal or agent, sells
or offers for sale any air transportation, or negotiates for, or
holds himself out by solicitation, advertisement, or otherwise
as one who sells, provides, furnishes, contracts or arranges
for, such transportation.

Upon enacting the FAA in 1958, Congress repealed the 1938 Act but
left section 411 unchanged. Pub. L. No. 85-726, §§ 101 & 411, 72
Stat. 731, 739-40, 769 (1958).
 21

agents only if they misrepresented themselves as airlines.

Additionally, with the change in the nature of the CRS
industry, the fact that the CAB acted when CRSs were owned by
airline carriers does not mean the Department is now barred
from interpreting section 411's broad delegation of authority in
a manner reasonably consistent Congress’s original intention,
which was to curb deceptive and unfair practices in the air travel
industry. The Supreme Court has repeatedly observed that “‘the
fact that a statute can be applied in situations not expressly
anticipated by Congress does not demonstrate ambiguity. It
demonstrates breadth.’” PGA Tour, Inc. v. Martin, 532 U.S.
661, 689 (2001) (quoting Yeskey, 524 U.S. at 212). Thus,
“statutes written in broad, sweeping language should be given
broad, sweeping application,” Consumer Elecs. Ass’n v. FCC,
347 F.3d 291, 298 (D.C. Cir. 2003). While Congress may not
have foreseen the ownership changes in the CRS industry,
absent evidence that Congress would have objected to the
Department’s interpretation of the statute, the historical
circumstances that led to enactment do not limit the permissible
interpretations of the statutory language. See New York v.
FERC, 535 U.S. 1, 23 (2002); Am. Airlines v. Dep’t. of Transp.,
202 F.3d 788, 809 (5th Cir. 2000). The legislative history
suggesting that Congress sought to bring all intermediaries
involved in the sale of air transportation under federal
administrative control rebuts Sabre’s position that the
Department’s construction of “ticket agent” is an unreasonable
accommodation that Congress would not have sanctioned.
Congress did not define “ticket agent[s]” as persons who are
travel agents, nor make the ability to issue a ticket the test of
being a travel agent, but rather defined the words in terms of
specific activities, i.e., persons selling air transportation,
offering it for sale, or holding themselves out as selling or
arranging for air transportation. That CRSs and travel agents
conduct related but somewhat different functions in the
distribution chain is, as the Department concluded, irrelevant.
 22

Congress’s focus was on deceptive sales and listed the functions
that would bring an entity within federal regulatory control. Its
definition of “ticket agent” was sufficiently broad to authorize
the Department to interpret the definition to encompass
changing ownership relationships. Cf. Am. Airlines, 202 F.3d at
809.

Accordingly, we hold that although the court has
jurisdiction to address Sabre’s petition because Sabre has
standing and Sabre’s preenforcement challenge to the
Department’s interpretation of its authority under section 411 is
ripe, Sabre’s challenge fails on the merits, and we deny the
petition for review.