Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-10-07138/USCOURTS-caDC-10-07138-0/pdf.json

Parties Involved:
Richard Dominguez
Appellant
UAL Corporation
Appellee
United Air Lines, Inc.
Appellee

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 16, 2011 Decided January 17, 2012

Reissued January 27, 2012

No. 10-7138

RICHARD DOMINGUEZ, ON BEHALF OF HIMSELF AND ALL 

OTHERS SIMILARLY SITUATED,

APPELLANT

v.

UAL CORPORATION AND UNITED AIR LINES, INC.,

APPELLEES

Appeal from the United States District Court

for the District of Columbia

(No. 1:07-cv-00418)

Roy A. Katriel argued the cause and filed the briefs for 

appellant.

John Roberti argued the cause for appellees. With him 

on the briefs was Richard J. Favretto. 

Before: HENDERSON, TATEL, and GRIFFITH, Circuit 

Judges.

Opinion for the Court filed by Circuit Judge GRIFFITH.

USCA Case #10-7138 Document #1355076 Filed: 01/27/2012 Page 1 of 10
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GRIFFITH, Circuit Judge: Richard Dominguez brought 

this antitrust class action lawsuit against United Air Lines, 

Inc. and its parent company UAL Corporation, challenging 

their policy prohibiting ticket resale. The district court granted 

summary judgment on the merits for the airline after deciding 

that it need not address whether Dominguez had standing to 

bring his claims. Because a federal court is not free to ignore 

standing, we took up the issue and conclude that there is none. 

The district court should have dismissed Dominguez’s suit for 

lack of jurisdiction because his claimed injury is too

speculative.

I

In an effort to maximize profits, United, like many other 

airlines, employs a pricing strategy that charges different 

prices for the same seats based on a customer’s willingness to 

abide certain conditions. For example, a customer can buy a 

cheaper ticket that has restrictions such as advance purchase, 

or a more expensive ticket without such limitations. This 

strategy will not work, however, if the buyer of a discounted 

ticket with a 21-day advance purchase requirement could sell 

that ticket just before the date of the flight to someone who 

would otherwise have to purchase a more expensive ticket.

United’s “No Transfer Policy,” which prohibits the re-sale of 

its tickets, is therefore a central feature of its pricing strategy.

On April 18, 2006, Dominguez purchased a package 

ticket for three United flights: from Dulles International 

Airport in Washington, D.C., to Oakland International Airport

on June 27, 2006; from San Francisco International Airport to 

Seattle-Tacoma International Airport on July 3, 2006; and 

from Seattle back to Dulles on July 8, 2006. Dominguez

claims that United’s No Transfer Policy kept him from buying 

his tickets at lower prices in violation of sections 1 and 2 of 

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the Sherman Act, 15 U.S.C. §§ 1, 2, as well as the common 

law prohibition of unjust enrichment. The district court 

concluded that the policy was lawful and granted summary 

judgment for United. Dominguez now appeals. He challenges 

United’s policy only as applied to non-stop air travel between 

metropolitan Washington, D.C., and the San Francisco Bay 

area, which United concedes is the relevant market for 

purposes of summary judgment. Only Dominguez’s flight to 

Oakland was in that market.

II

Acknowledging that “Dominguez’s claims of injury are 

indeed speculative,” the district court nevertheless concluded 

that there was “no need to address standing” because it “ha[d] 

concluded as a matter of law that no antitrust violation ha[d] 

occurred.” Dominguez v. UAL Corp., No. 07-0418, at 6 n.4 

(D.D.C. Sept. 28, 2010). In taking this approach, the district 

court erred. Article III of the Constitution strictly limits the

federal judicial power to resolving “Cases” and 

“Controversies.” U.S. CONST. art. III, § 2. This limitation is 

no mere formality: it “defines with respect to the Judicial 

Branch the idea of separation of powers on which the Federal 

Government is founded.” Allen v. Wright, 468 U.S. 737, 750 

(1983). The requirement that a plaintiff have standing “is an 

essential and unchanging part of the case-or-controversy 

requirement of Article III.” Lujan v. Defenders of Wildlife, 

504 U.S. 555, 560 (1992). As such, standing is a necessary

“predicate to any exercise of our jurisdiction,” Fla. Audubon 

Soc’y v. Bentsen, 94 F.3d 658, 663 (D.C. Cir. 1996) (en banc), 

and if it is lacking, then “the dispute is not a proper case or 

controversy, [and] the courts have no business deciding 

it, or expounding the law in the course of doing so,”

DaimlerChrylser Corp. v. Cuno, 547 U.S. 332, 341 (2006). 

See also Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 

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94 (1998) (“Without jurisdiction the court cannot proceed at 

all in any cause. Jurisdiction is power to declare the law, and 

when it ceases to exist, the only function remaining to the 

court is that of announcing the fact and dismissing the cause.”

(quoting Ex parte McCardle, 74 U.S. (7 Wall.) 506, 514 

(1868)) (internal quotation marks omitted)). Thus, every 

federal court has a “special obligation to satisfy itself” of its 

own jurisdiction before addressing the merits of any dispute. 

See Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 

541 (1986).

That the merits of a particular claim may be clear is no 

reason to avoid the constitutionally required inquiry into this 

limit on our jurisdiction. It is no doubt tempting for courts to 

bypass jurisdictional issues and address the merits of disputes, 

especially where the merits question may be easily answered, 

but standing is a check that reinforces the constitutional 

principle that some disputes are beyond our authority to

resolve. See Warth v. Seldin, 422 U.S. 490, 498 (1975) 

(“[Standing] is founded in concern about the proper — and 

properly limited — role of the courts in a democratic 

society.”). The Supreme Court has criticized courts for 

assuming jurisdiction as the district court did in this case, 

stating emphatically that “[w]e decline to endorse such an 

approach because it carries the courts beyond the bounds of 

authorized judicial action and thus offends fundamental 

principles of separation of powers.” Steel Co., 523 U.S. at 94;

see also Allen, 468 U.S. at 751 (explaining that the “case-orcontroversy doctrines state fundamental limits on federal 

judicial power in our system of government” and that “[t]he 

Art. III doctrine that requires a litigant to have ‘standing’ is 

perhaps the most important of these doctrines”).

The district court treated this bedrock constitutional 

principle as if it were something trivial. Although this error 

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“might be thought to warrant a remand, so that the district 

court could consider the matter in the first instance, the 

Supreme Court has instructed courts of appeals to decide for 

themselves whether the party seeking judicial review has 

standing, even if the issue was not decided below.” Found. on 

Econ. Trends v. Lyng, 943 F.2d 79, 82 (D.C. Cir. 1991) 

(citing FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 230-31 

(1990)). Thus, we are required to comb the record to 

determine whether Dominguez has standing.

III

Every plaintiff in federal court bears the burden of 

establishing the three elements that make up the “irreducible 

constitutional minimum” of Article III standing: injury-infact, causation, and redressability. See Lujan, 504 U.S. at 560-

61. At summary judgment, Dominguez’s burden is to show 

that a reasonable juror could find he has standing. See Meijer,

Inc. v. Biovail Corp., 533 F.3d 857, 862 (D.C. Cir. 2008). To 

satisfy this burden, Dominguez cannot rest on “mere 

allegations” but must establish each element of standing by 

putting forth “specific facts.” Lujan, 504 U.S. at 561 (quoting 

FED. R. CIV. P. 56(e)). We will take Dominguez’s facts as true 

and draw all reasonable inferences in his favor. See Geleta v. 

Gray, 645 F.3d 408, 410 (D.C. Cir. 2011).

Dominguez claims that United’s No Transfer Policy 

prevented him from buying a less expensive ticket for his 

Dulles-to-Oakland flight by foreclosing the emergence of a 

secondary market of ticket resellers. But, for the reasons set 

forth below, we conclude that no reasonable juror could find 

that Dominguez was overcharged as a result of the policy. 

The gaps in the evidence he presented and the nature of the 

ticket he bought make Dominguez’s injury “speculative at 

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best.” See Transmission Agency of N. Cal. v. FERC, 495 F.3d 

663, 670 (D.C. Cir. 2007).

To show the likely emergence of a secondary market, 

Dominguez relies primarily on surveys conducted by Dr. 

Bruce Isaacson that measured consumer interest if purchasers 

of non-refundable United tickets for travel in the relevant 

market were allowed to sell them to others. Dr. Isaacson

concluded that “a high percentage of respondents would 

consider using a feature allowing them to legally sell or give 

away airline tickets they are unable to use.” Pl.’s Opp’n to 

Defs.’ Mot. Summ. J. Ex. 2, at 1. Dominguez also relies on 

the testimony of Frank Levy, co-founder of FairAir.com

(FairAir), which briefly resold airline tickets in an online 

secondary market in 2001. FairAir shut down after only six 

weeks of operation, when the airlines it was working with

decided not to allow ticket transfer due to concerns that a 

secondary market would undermine their pricing strategies.

According to Levy, a secondary market similar to the one 

Dominguez envisions can exist, and Levy testified that he 

would be interested in relaunching FairAir. In response, 

United asserts that the prediction that a secondary market 

would emerge is simply too speculative. See Fla. Audubon 

Soc’y, 94 F.3d at 670. Not only does the prediction rest on the 

gauzy finding that consumers “would consider” buying and 

selling transferable airline tickets, but it runs up against the 

hard reality that no secondary market of the type Dominguez 

envisions currently exists even though other airlines allow 

ticket resale.

But we need not resolve this dispute because Dr. 

Isaacson’s survey cannot show that any secondary market 

would have led to a lower price than what Dominguez paid 

for his flight from Dulles to Oakland. Dr. Isaacson admitted 

that his survey did not take into account costs associated with 

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running a secondary market. For example, at the time 

Dominguez bought his ticket in 2006, airlines allowing ticket 

transfer charged name-change fees of up to $50. One of 

Dominguez’s experts admitted that now such fees are 

typically between $25 and $100, and another explained that a 

$150 fee is not unreasonable. Indeed, United currently 

charges a $150 fee for changes to an itinerary, but Dr. 

Isaacson’s survey assumed, without explanation, that no 

similar charge would have been assessed for name changes. 

Given the practices of other airlines and United’s own 

itinerary-change fees, it would be unreasonable to infer that 

United would not have charged such fees. Moreover, the 

amount of that fee would be completely within United’s 

control. United could reasonably charge a fee that would 

reduce the possibility of secondary market transactions by 

making them economically unviable. As Dr. Isaacson 

admitted in his deposition, United’s ability to charge a fee for 

name changes decreases the likelihood that prices in a 

secondary market would be low enough to place pressure on 

United to reduce its prices. 

In addition, Dr. Isaacson’s survey did not take into 

account costs such as the approximately $495,000 it would 

cost United to change its reservation system to allow for name 

changes on previously issued tickets or what it would cost to 

educate consumers about the secondary market. His survey 

also overlooked that the creator of the secondary market 

would charge fees, just as eBay and similar websites do now. 

FairAir itself charged a $10 flat fee plus a 6% commission 

(with a $25 minimum) to process transfers. All of these costs, 

uncounted by Dr. Isaacson, would have increased ticket prices 

in a secondary market. The analysis on which Dominguez

relies cannot be used to conclude that he would have 

benefited from a secondary market because it fails to present 

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an accurate picture of the prices that would be negotiated in 

that market.

Dominguez faces another problem in basing his claim of 

injury on Dr. Isaacson’s survey: the survey does not even 

speak to the relevant question of whether secondary market 

prices would have been lower than what Dominguez paid to 

fly from Dulles to Oakland. The survey compares ticket prices 

for flights between Dulles and Oakland with and without the 

No Transfer Policy and concludes they would be less 

expensive without the policy because a secondary market 

would emerge. But Dominguez’s flight from Dulles to 

Oakland was less expensive than the flights Dr. Isaacson 

considered because he received a package discount by buying 

three flights together.* In short, the survey claims secondary 

market prices would be lower than prices without a package 

discount, but Dominguez did not pay that price. Even if 

Isaacson’s survey shows that some United customers were 

injured by the No Transfer Policy — and for the reasons 

already discussed that seems uncertain at best — it would still 

be speculative to think the survey shows Dominguez was one 

of them.

At a more general level, Dominguez’s data showing 

lower secondary market prices assumes that United would 

continue to offer the same types of tickets that it does now. 

But without the No Transfer Policy, United could not enforce 

the restrictions it currently imposes on its discounted tickets 

and would need to alter its pricing strategy, which may very 

 * United’s Director of Domestic Pricing explained that in 2009 

a package ticket on Dominguez’s route was $728 as opposed to a 

total of $832 for three one-way tickets. No data was provided on 

the comparative prices at the time of Dominguez’s purchase, but 

these numbers illustrate the uncontroverted point that under 

United’s pricing Dominguez received a package discount.

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well result in higher average ticket prices if it stopped offering 

discounts. It piles speculation atop speculation to assume that 

United would continue to offer discounted tickets if it could 

no longer price discriminate. Cf. Adams v. Pan Am. World 

Airways, Inc., 828 F.2d 24, 30 (D.C. Cir. 1987) (“[In antitrust 

cases,] injury turns on the impact of the alleged wrong on the 

relevant market itself, so that the fact finders cannot take a 

market structure as given.”). Based on the evidence presented, 

no reasonable juror could find that Dominguez was 

overcharged as a result of the No Transfer Policy, and 

therefore he lacks standing to challenge the policy in federal 

court.

Finally, we address an argument that Dominguez pressed 

in his supplemental brief on standing and again at oral 

argument. Relying on a line of antitrust cases starting with 

Bigelow v. RKO Radio Pictures, 327 U.S. 251 (1946), 

Dominguez argued that injury-in-fact in antitrust cases should 

be inferred when the defendant’s wrongdoing has prevented 

more precise proof of the fact of injury. But Bigelow was not 

a standing case. Instead, it addressed whether the plaintiff’s 

evidence was precise enough to support a jury award and 

established the settled principle that it is improper to insist 

upon “precise proof” of the amount of damages when “the 

defendant by his own wrong has prevented a more precise 

computation.” Id. at 264. Later cases clarify that Bigelow’s 

principle applies only to the showing needed to support a 

damage award, not to the constitutional requirement that the 

plaintiff show the fact of injury. See J. Truett Payne Co. v. 

Chrysler Motors Corp., 451 U.S. 557, 570 (Powell, J., 

dissenting) (highlighting the difference between the “fact of 

antitrust injury” and “the evidence [required] to prove the 

amount of damages”); In re Visa Check/Mastermoney 

Antitrust Litigation, 192 F.R.D. 68, 82-83 (E.D.N.Y. 2000), 

aff’d, 280 F.3d 124 (2d Cir. 2001) (“The fact of injury . . . 

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should not be confused with the extent of injury (as reflected 

by the amount of damages) which may not be amenable to 

establishment with great precision.”).

IV

For the foregoing reasons, the judgment of the district 

court is vacated, and the case is remanded with directions that 

the complaint be dismissed for lack of jurisdiction.

So ordered.

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