Order 2012-7-30

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 27th day of July, 2012

Travelocity.com LP Docket 2012-0002

Violations of 49 U.S.C. § 41712 and

14 CFR 399.84 Served July 27, 2012

 

CONSENT ORDER

This consent order concerns certain Internet advertisements by Travelocity.com LP 

(Travelocity) through its flexible dates tool that, for certain international searches, did not 

include fuel surcharges in the fare. The omission of fuel surcharges in advertised fares 

violates the full fare advertising requirements specified in 14 CFR 399.84 and the 

statutory prohibition against unfair and deceptive practices in the sale of air 

transportation, 49 U.S.C. § 41712. This consent order directs Travelocity to cease and 

desist from future violations of 14 CFR 399.84 and section 41712 and assesses the carrier 

a compromise civil penalty of $180,000.

Applicable Law

Under 14 CFR 399.84, airfare advertisements by ticket agents must state the full fare 

charged the consumer. Failure to state the full fare in advertisements, in addition to 

violating the rule, constitutes an unfair and deceptive practice in violation of 49 U.S.C. 

§ 41712. Until recently, the Department permitted certain enforcement policy exceptions 

to the “full fare” advertising standard.

1

 The Department had enunciated, through industry 

notices and in consent orders, an enforcement policy in which certain taxes and 

government fees could lawfully be stated separately from the base fare. Specifically, in 

accordance with its enforcement case precedent, the Department allowed taxes and fees 

collected by carriers and other sellers of air transportation, such as passenger facility 

charges (PFCs) and departure taxes, to be stated separately in fare advertisements so long 

 1 On April 20, 2011, the Department issued a rule changing its enforcement policy with respect to section 

399.84 to require that airlines and ticket agents comply with the rule as written. Under this new 

enforcement policy, which took effect on January 26, 2012, airlines and ticket agents must include all 

government imposed taxes and fees in every advertised fare. The Department’s long-standing prohibition 

on omitting carrier- or agent-imposed charges, such as fuel surcharges or convenience fees, from advertised 

fares remains in effect.
2

as the charges were levied by a government entity, were not ad valorem in nature, i.e., 

they were collected on a per-passenger basis, and their existence and amount were clearly 

indicated in the advertisement so that the consumer could determine the full fare to be 

paid. On the other hand, ticket agent and air carrier-imposed fees, e.g., surcharges for 

fuel, insurance, or other such costs, were required to be included in the advertised fare. 

Background

An investigation in September, 2011, by the Office of Aviation Enforcement and 

Proceedings (Enforcement Office) revealed a lack of compliance by Travelocity with 

section 399.84 on its “flexible dates tool” airfare search path. Until the tool was disabled 

by Travelocity, the flexible dates tool failed to display the full fare for certain 

international airfares. Specifically, some advertised airfares did not include fuel 

surcharges, and as a result were displayed with, and ranked above, airfares that did 

include fuel surcharges.

2 According to Travelocity, its flexible dates tool was not 

capable of including certain carrier-imposed surcharges, such as fuel surcharges, 

applicable to some international airfares following a change in the amount or method of 

filing the surcharge, until after the first search using the flexible dates tool to search for a 

particular itinerary. Travelocity states that the problem occurred because carriers are not 

required to inform agencies of any changes to their surcharges. After the initial search, 

whether conducted by a consumer or Travelocity, Travelocity’s software would capture 

the carrier’s inclusion of a new surcharge on a filed fare and in future searches for the 

same city pair would include the full fare information.3 However, each time carriers 

added new surcharges or increased or decreased existing surcharges, those charges were 

not accurately reflected in some airfares advertised on the flexible dates tool until after at 

least one search for a particular itinerary had been conducted. Failing to include such 

carrier-imposed charges in the initial fare advertised violated the requirements of section 

399.84. 

Additionally, failing to include fuel surcharges in some, but not all, of the airfares 

advertised in the initial display of airfares resulted in airfares that did not include fuel 

surcharges being displayed above and more prominently than those airfares that did

include fuel surcharges. The airfares appeared to be displayed from lowest to highest 

price for the selected city pair; however, the airfares that initially appeared to be the 

lowest price often had higher total airfares, when all surcharges, taxes, and fees were 

 2 In search results displayed by the flexible dates tool, airfares were shown with a “plus” sign. Near the top 

of the screen another plus sign appeared next to the note “some taxes, additional fees apply,” hyperlinked to 

an explanatory screen. The additional charges listed there were a variety of U.S. and foreign per-person 

taxes that were permitted prior to January 26, 2012, to be broken out of the initially advertised base fare 

under Department precedent. However, in a number of sample searches for international airfares, the 

disparity between the first airfare displayed and the price ultimately displayed in the final steps prior to 

completion of a transaction was significantly higher than the total of the government imposed taxes that 

legitimately could have been broken out of the base fare. The large differences resulted from undisclosed 

fuel surcharges.

3 Travelocity states that it searched 245 top international city pairs on a daily basis to update its flexible 

dates tool.
3

included. In those instances, the carriers associated with the higher ranking airfares were 

deceptively depicted as having the lowest cost airfare. As a result, a consumer was likely 

to have initially selected an airfare that was not the lowest available airfare that met his or 

her needs or selected a carrier that was not the carrier he or she would have chosen if 

provided with more accurate information.4

After proceeding through the steps to select an itinerary and proceeding to the next page, 

the consumer had the opportunity to review his or her selection. For itineraries for which 

a paper ticket was required, it was only on this final page that the consumer was informed 

that the selected itinerary required a paper ticket, with a minimum additional delivery fee 

of $29.95.5 A new total price was displayed. When the fuel surcharges and paper ticket 

fees were all included, in some cases the total amount for the airfare that was initially 

displayed as the lowest airfare was significantly higher than other airfares advertised less 

prominently in the same display.

6

 

Since the initial fare display ranked airfares from the lowest airfare to the highest, those 

carriers whose fuel surcharges and paper ticket fees were not included in the airfare 

initially displayed outranked other carriers in the display, despite the fact that their total 

airfares may have been equal to, or greater than, those of other carriers. As a result of the 

display and selection process, the Enforcement Office believes that consumers likely 

purchased airfares on carriers and travel dates that were not the carrier or travel dates that 

best met their needs.

Mitigation

In mitigation, Travelocity states that it does not believe any of the above circumstances 

warrant enforcement action, and that the discrepancies identified above were limited and 

did not result in any consumer harm or deception. Moreover, Travelocity asserts that any 

alleged harm that may have occurred was greatly outweighed by what it claims to be the 

significant consumer benefits experienced by consumers. The flexible dates feature, in 

Travelocity’s view, provided a valuable tool for consumers to use to search for airfares 

and save money. According to Travelocity, hundreds of thousands of consumers 

purchased their airfare using the flexible dates tool in a single year, saving more than $35 

million in the aggregate. Travelocity also maintains that its failsafe page, which provided 

 4

 We note that, in most instances, the flexible dates tool displayed one or more alternatives to the 

consumer’s chosen itinerary with a lower total airfare under the heading “Save” before a consumer 

completed a purchase. However, the alternatives were limited to the same dates as the itinerary selected by 

the consumer. Accordingly, the alternatives did not sufficiently guard against the possibility that a 

consumer might have chosen to travel at a lower fare on another date, another carrier, or both, if he or she 

had been provided accurate fare information on the first display of airfares.

5 Travelocity estimates that of all the air tickets sold on Travelocity, only 0.3% of them require paper 

tickets. A paper ticket is only required when, in a code-share arrangement, the marketing carrier and 

operating carrier do not have an e-ticket agreement in place. Due to the lack of agreement by the carriers, a 

paper ticket is issued to the passenger.

6 Additionally, in some cases, the same itinerary was available using different search tools on Travelocity 

or on other websites at a lower price and without the paper ticket related fee.
4

lower available fares for the itinerary and date selected provided an additional level of 

protection.

To address the Department’s concerns, however, Travelocity states that it promptly 

disabled and removed from its website the flexible dates tool for both domestic and 

international itineraries. Travelocity believes that this is to the detriment of pricesensitive consumers who relied on Travelocity’s efficient tool to search for and find the 

most affordable airfares between two cities during a certain time range.

Decision

The Enforcement Office has carefully considered the information provided by 

Travelocity but continues to believe that enforcement action is warranted. The 

Enforcement Office and Travelocity have reached a settlement of this matter in order to 

avoid the risks and costs of litigation. Without admitting or denying the violations 

described herein, Travelocity consents to the issuance of an order to cease and desist 

from future violations of section 41712 and 14 CFR 399.84, and to the assessment of 

$180,000 in compromise of potential civil penalties otherwise due and payable pursuant 

to 49 U.S.C. § 46301. 

This compromise assessment is appropriate considering the nature and extent of the 

violations described herein and Travelocity’s size and sophistication. Additionally, it 

serves the public interest. It represents a strong deterrent to future noncompliance with 

the Department’s airfare advertising requirements by Travelocity and other sellers of air 

transportation. 

This order is issued under the authority contained in 49 CFR 1.57a and 14 CFR 385.15.

ACCORDINGLY,

1. Based on the above discussion, we approve this settlement and the provisions of 

this order as being in the public interest;

2. We find that Travelocity.com LP violated 14 CFR 399.84 by advertising fares that 

failed to state the entire price to be paid;

3. We find that by engaging in the conduct described in ordering paragraph 2 above, 

Travelocity.com LP also engaged in an unfair and deceptive practice in violation 

of 49 U.S.C. § 41712;

4. We order Travelocity.com LP, and all other entities owned or controlled by or 

under common ownership with Travelocity.com LP, and its successors and 

assignees, to cease and desist from violations of 49 U.S.C. 41712 and 14 CFR 

399.84. Failure to comply with this cease and desist provision shall subject 

Travelocity.com LP and their successors and assignees to further enforcement 

action;
5

5. We assess Travelocity.com LP a compromise civil penalty of $180,000 in lieu of 

civil penalties that might otherwise be assessed for the violations described in 

ordering paragraphs 2 and 3, above. Of this total assessed penalty, $90,000 shall 

be due and payable within thirty days of the issuance of this order. The remaining 

$90,000 shall be due and payable if Travelocity.com LP violates this order’s cease 

and desist provisions within one year following the date of issuance of this order 

or fails to comply with the payment provisions of this order, in which case the 

entire unpaid portion of the $90,000 assessed penalty shall become due and 

payable immediately; and

6. We order Travelocity.com LP to pay the penalty through Pay.gov to the account 

of the U.S. Treasury. Payments shall be made in accordance with the instructions 

contained in the Attachment to this order. Failure to pay the penalty as ordered 

shall subject Travelocity.com LP to the assessment of interest, penalty, and 

collection charges under the Debt Collection Act and to further enforcement 

action for failing to comply with this order.

This order will become a final order of the Department 10 days after its service date 

unless a timely petition for review is filed or the Department takes review on its own 

motion.

BY:

SAMUEL PODBERESKY

Assistant General Counsel for

 Aviation Enforcement and Proceedings

(SEAL)

An electronic version of this document is available at

www.regulations.gov