Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-14-01143/USCOURTS-caDC-14-01143-0/pdf.json

Parties Involved:
Airlines for America
Petitioner
International Air Transport Association
Petitioner
John S. Pistole
Respondent
Transportation Security Administration
Respondent

Document Text:

United States Court of Appeals 

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued January 14, 2015 Decided March 10, 2015

No. 14-1143

AIRLINES FOR AMERICA AND

INTERNATIONAL AIR TRANSPORT ASSOCIATION,

PETITIONERS

v.

TRANSPORTATION SECURITY ADMINISTRATION AND

JOHN S. PISTOLE, ADMINISTRATOR

RESPONDENTS

On Petition for Review of an Order of 

the Transportation Security Administration

Paul D. Clement argued the cause for petitioners. With 

him on the briefs were Jeffrey M. Harris, William R. Levi,

David A. Berg, and Jeffrey N. Shane.

Jeffrey Clair, Attorney, U.S. Department of Justice, 

argued the cause for respondents. With him on the brief was 

Scott R. McIntosh, Attorney.

Before: HENDERSON, Circuit Judge, and WILLIAMS and 

RANDOLPH, Senior Circuit Judges.

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Opinion for the Court filed by Senior Circuit Judge

WILLIAMS. 

WILLIAMS, Senior Circuit Judge: The Transportation 

Security Administration (“TSA”) has charge of the “screening 

of all passengers and property” moving by passenger aircraft.

49 U.S.C. § 44901(a). To cover the costs of screening, it is 

authorized to impose a “uniform fee . . . on passengers . . . in 

air transportation and intrastate air transportation originating 

at airports in the United States.” § 44940(a)(1). Airlines

collect the fees from passengers and remit the funds to TSA.

§ 44940(e)(2)-(3).

In 2013, Congress reset the fee to “$5.60 per one-way trip 

in air transportation or intrastate air transportation that 

originates at an airport in the United States.” Bipartisan 

Budget Act of 2013, Pub. L. No. 113-67, § 601(b), 127 Stat. 

1165, 1187 (2013) (codified as amended at 49 U.S.C. 

§ 44940(c)(1)). TSA implemented this amendment in an 

Interim Final Rule. Adjustment of Passenger Civil Aviation 

Security Service Fee (“Interim Final Rule”), 79 Fed. Reg. 

35,462, 35,465-66 (Jun. 20, 2014) (codified as amended at 49 

C.F.R. §§ 1510 et seq.). The parties agree that a “one-way 

trip” means the same in the statute as in TSA’s regulations, 

namely, a continuous trip from one point to another with no 

stopover exceeding specified limits (e.g., four hours between 

domestic flights). See 49 C.F.R. § 1510.3. Thus a trip from 

New York to Los Angeles to San Francisco and back to New 

York, with stopovers exceeding four hours in each of the 

California cities, would be a round trip comprised of three 

one-way trips. 

Airline trade organizations representing individual 

airlines filed this petition to challenge TSA’s rules on two 

grounds. First, the airlines argued that TSA had no authority 

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to impose fees in excess of $11.20 on passengers with roundtrip itineraries that involved multiple “one-way trips” (as in 

the example above). While the case has been pending, 

Congress further amended the fee statute, adding language 

that the parties agree gave the airlines what they sought and 

therefore moots this aspect of the case. Pub. L. No. 113-294, 

§ 1, 128 Stat. 4009 (2014) (codified at 49 U.S.C. § 

44940(c)(1)); TSA, Office of Revenue, Notice of Immediate 

Adjustments (Dec. 19, 2014). We thus dismiss that claim. 

The airlines’ remaining claim is that the statute precludes 

TSA from charging a fee on passengers whose travel begins 

abroad but includes a connecting flight within the United 

States—for example, a passenger who flies from Paris to New 

York and then takes a connecting flight on to Chicago. On 

this claim, we find that the airlines have standing but lose on 

the merits. 

* * *

TSA contends that the airlines lack standing for want of 

suffering any “injury in fact”: the security fees are paid by

customers, not the airlines themselves, and the airlines failed 

to produce evidence demonstrating that the fees caused any 

economic losses. But the passengers’ role as ultimate payers 

of the fee says nothing about its incidence—that is, how much 

of the burden falls upon the customers and airlines, 

respectively. We recognized in Branton v. FCC, 993 F.2d 

906 (D.C. Cir. 1993), the basic proposition that “increasing 

the price of an activity . . . will decrease the quantity of that 

activity demanded in the market.” Id. at 911-12 (citing PAUL 

A. SAMUELSON & WILLIAM D. NORDHAUS, ECONOMICS 60-61 

(12th ed. 1985)). In Branton itself we saw an exception to the 

principle, thinking it “speculative” that fining NPR for 

broadcasting indecent language would deter it from doing so 

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in the future because, as a non-profit journalistic entity, it was 

somewhat insulated from market forces. Id. While there are 

other exceptions to the rule (the cognoscenti will think 

immediately of so-called “Giffen goods”), TSA has given no 

reason to suspect that any such exception is applicable here. 

Thus, the security fees injure the airlines by increasing the net 

price for airline tickets and reducing demand for those tickets. 

While the impact on demand is likely to be modest, the 

direction of change in demand is clear (downward). The 

Government Accountability Office estimated in 2012 that a 

proposed increase in fees from $2.50 to $5.50 per 

enplanement, though very small as a proportion of average 

airline charges, would decrease the demand for airline tickets,

offsetting the government’s net revenue gain from the fee 

increase by over $100 million over a three-year period. 

Government Accountability Office, 2012 Annual Report at 

309-10 (Feb. 2012). In any event, the court’s duty to refrain 

from merits rulings until assured of jurisdiction, see Steel Co. 

v. Citizens for a Better Env’t, 523 U.S. 83 (1998), does not 

mandate an econometric study of the exact quantity of change. 

And, as the injury is inferable from generally applicable 

economic principles rather than from any special 

circumstances, it is sufficiently “self-evident” that we require

“no evidence outside the administrative record.” Sierra Club 

v. EPA, 292 F.3d 895, 900 (D.C. Cir. 2002).

* * *

Section 44940(c)(1) provides that the security fee 

shall be $5.60 per one-way trip in air transportation or 

intrastate air transportation that originates at an airport in 

the United States . . . .

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49 U.S.C. § 44940(c)(1) (emphasis added). TSA reads this as 

authorizing it to collect fees from passengers whose travel 

begins abroad but includes a connecting flight within the 

United States, as in the example we gave earlier: a passenger 

traveling from Paris to Chicago with a connecting flight in 

New York. Interim Final Rule, 79 Fed. Reg. at 35,465-66. 

This reading rests on two interpretive arguments. 

First, TSA argues that the italicized clause does not 

modify “one-way trip”—a term TSA concedes means overall 

trip and not a mere segment—but only “air transportation or 

intrastate air transportation.” We agree. Attaching the clause 

to “one-way trip,” as the airlines propose, would mean that in 

the pre-2013 version of the statute the clause modified

“enplanement,” which the 2013 statute replaced with “oneway trip.” See Aviation and Transportation Security Act, 

Pub. L. No. 107-71, § 118, 115 Stat. 597, 626 (2001) (codified 

at 49 U.S.C. § 44940(c) before the 2013 amendment)

(directing TSA to set the fee at no more than “$2.50 per 

enplanement in air transportation or intrastate air 

transportation that originates at an airport in the United States

. . . .”). But this would be incoherent. Unlike “air 

transportation,” which spans multiple locations, an 

“enplanement” happens at a single place—the airport of 

departure. It would be very odd to speak of an enplanement

as “originating” somewhere. Congress’s specification of an 

originating location must have applied to the “air 

transportation or intrastate air transportation,” not the 

“enplanement.” And the airlines themselves insist that the 

2013 substitution of the term “one-way trip” for

“enplanement” “did not alter which antecedent was modified” 

by the italicized clause. Pet’rs’ Reply 12; see also id. at 13-

14. 

Moreover, under the airlines’ reading we would have to 

believe that Congress intended different meanings for a nearly 

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identical phrase as used in two neighboring provisions.

Section 44940(a)(1) tells TSA to impose the fee on 

“passengers of air carriers and foreign air carriers in air 

transportation and intrastate air transportation originating at 

airports in the United States.” This provision unmistakably 

uses the phrase “originating at airports in the United States” to 

modify the immediately preceding nouns “air transportation 

and intrastate air transportation.” A similar reading for 

§ 44940(c)(1)’s nearly identical phrase—“air transportation or

intrastate air transportation that originates at an airport in the 

United States”—harmonizes usage across the two provisions

and is preferable on that account. See, e.g., Powerex Corp. v. 

Reliant Energy Servs., Inc., 551 U.S. 224, 232 (2007).

Second, TSA contends that the terms “air transportation” 

and “intrastate air transportation” may refer to segments of 

longer trips, such that, for instance, a flight from New York to 

Chicago constitutes “air transportation . . . that originates at an 

airport in the United States,” even if it is part of a longer “oneway trip” that began in Paris. See Interim Final Rule, 79 Fed. 

Reg. at 35,465 (“[I]f there is covered air transportation at any 

point in the trip . . . TSA has authority to impose the fee.”). 

The airlines seem to share this idea, if only for a moment.

Their opening brief acknowledges that an itinerary that does 

not contain a one-way trip in air transportation originating at 

an airport in the United States might, nonetheless, include “air 

transportation . . . originating at airports in the United 

States”—a proposition implying that “air transportation” may 

refer to segments of “one-way trips.” See Pet’rs’ Br. 27. 

Elsewhere, however, the airlines maintain that “in the case of 

a one-way trip beginning abroad with a tail-end domestic 

enplanement, both the one-way trip and the air transportation 

originate abroad.” Pet’rs’ Reply Br. 12.

The statute’s definitional provisions—all but ignored by 

both parties here—do provide some indication that “air 

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transportation” refers to an overall trip. “Air transportation” 

is defined as “foreign air transportation, interstate air 

transportation, or the transportation of mail by aircraft.” 49 

U.S.C. § 40102(a)(5). In turn, “‘foreign air transportation’ 

means the transportation . . . between a place in the United 

States and a place outside the United States when any part of 

the transportation is by aircraft.” § 40102(a)(23) (emphasis 

added). And, similarly, “‘interstate air transportation’ means 

the transportation . . . between a place in . . . a State . . . and a 

place in . . . another State . . . when any part of the 

transportation is by aircraft.” § 40102(a)(25) (emphasis 

added). Use of the limiting phrase “when any part of the 

transportation is by aircraft” in both of the last two definitions 

may seem to imply that the reference is to overall trips, not 

mere segments. If only the whole trip constitutes “air 

transportation,” a trip from Paris to Chicago with a connecting 

flight in New York would not include any “air transportation . 

. . that originates at an airport in the United States.” (More 

curiously, neither would a flight from Detroit to Chicago if the 

passenger starts out by bus in Windsor, Ontario.)

But even if the definitional provisions demonstrate that 

“air transportation” refers to an overall trip, the same term 

may also refer to the individual segments of such a trip. 

Indeed, the ordinary meaning of the term encompasses both a 

whole trip and its parts. 

The airlines argue that the logic of TSA’s rule for the 

passenger traveling from abroad would permit TSA to charge 

multiple fees on one-way trips, defying Congress’s intention 

to “simplif[y] the fee structure to a flat, $5.60 fee per one-way 

trip, regardless of the number of enplanements.” H. Comm. 

On the Budget, 113th Cong., Rep. on Bipartisan Budget Act 

of 2013, at 18 (Comm. Print Feb. 2014). But the fee imposed 

here is entirely in line with § 44940(c)(1)’s instruction that the 

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fee “shall be $5.60 per one-way trip”; the fact that the trips in 

question include non-domestic segments does not change that. 

The airlines further contend that Congress intended to 

make enplanements entirely irrelevant to the scheme. But all

the legislative history shows is that Congress meant to render 

irrelevant “the number of enplanements” in the course of 

imposing a cap of “a flat, $5.60 fee per one-way trip.” TSA’s 

imposition of a single fee on a one-way trip from Paris to 

Chicago with a connecting flight in New York is fully 

consistent with this purpose. 

The airlines also claim that TSA’s rule flouts Congress’s 

intention to promote “uniform treatment” across passengers 

with similar itineraries. Indeed, TSA’s interpretation requires 

certain similarly situated passengers to be “treated 

disparately,” as the airlines suggest. For instance, passengers 

traveling from Paris to Chicago will or will not be charged 

depending on whether their one-way trip includes a 

connecting flight in the United States. But some such 

“disparate treatment” appears unavoidable. Under the 

airlines’ preferred reading, for example, passengers traveling 

from New York to Chicago will or will not be charged the fee 

depending on whether the flight was part of a longer itinerary 

commencing abroad or a complete trip in itself. Contrary to 

the airlines’ suggestion, neither Congress’s stated purpose of 

“simplif[ying] the fee structure” nor its statutory instruction 

that the fee be “uniform,” § 44940(a)(1), gives any indication 

that one form of asymmetry is preferable to the other. 

Under Chevron v. Natural Resources Defense Council, 

Inc., 467 U.S. 837 (1984), the agency’s interpretation 

“governs if it is a reasonable interpretation of the statute—not 

necessarily the only possible interpretation, nor even the 

interpretation deemed most reasonable by the courts.” 

Entergy Corp. v. Riverkeeper, Inc., 556 U.S. 208, 218 (2009). 

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The textual ambiguity, coupled with the lack of any 

compelling legislative history, and TSA’s explanation that its 

construction “better aligns the imposition of the fee with those 

who benefit from the security services provided,” Interim 

Final Rule, 79 Fed. Reg. at 35,465, clearly allows TSA’s 

decision to surmount this hurdle. 

* * *

The petition for review is

Dismissed in part and denied in part. 

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