Order 2010-6-23

 

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION 

OFFICE OF THE SECRETARY 

WASHINGTON, D.C.

Issued by the Department of Transportation

On the Twenty-Eighth day of June, 2010

Sceptre Tours, Inc. Docket OST 2010-0005

Violations of 49 U.S.C. § 41712 and 

14 CFR Part 399 Served June 28, 2010

CONSENT ORDER

This consent order concerns internet advertisements by Sceptre Tours, Inc. (Sceptre 

Tours) that violate the Department’s advertising requirements specified in section 399.84 

of the Department’s regulations and constitute unfair and deceptive trade practices and 

unfair methods of competition in violation of 49 U.S.C. § 41712. This order directs 

Sceptre Tours to cease and desist from such further violations and assesses Sceptre Tours

a compromise civil penalty of $30,000. 

Applicable law

Sceptre Tours is a “ticket agent” as defined by 49 U.S.C. § 40102(a)(45)1

 

, which subjects 

it to the prohibitions on engaging in unfair and deceptive practices set forth in 49 U.S.C. 

§ 41712, and to the advertising requirements of Part 399 of the Department’s rules (14 

CFR 399.84). To ensure that consumers are not deceived and are given accurate and 

complete fare information on which to base their airline travel plans, 14 CFR 399.84 

requires that advertisements specifying airfares and tour package prices with an air 

component state the full price to be paid by the consumer. Under long-standing 

enforcement case precedent, the Department has allowed taxes and fees collected by 

carriers and ticket agents, such as passenger facility charges and departure taxes, to be 

stated separately from the base fare in advertisements, so long as such taxes and fees are 

levied by a government entity, are not ad valorem in nature, are collected on a per1 A “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.” 49 U.S.C. § 40102(a)(45).

 
2

passenger basis, and their existence and amounts are clearly indicated in the 

advertisement so that the consumer can determine the full fare to be paid.2

With respect to internet advertisements, the full fare may be stated on the first screen that 

provides fare quotes, or the existence of permissibly separately-stated additional charges 

may be disclosed in a clearly and prominently presented hyperlink, e.g., “taxes and fees 

extra”, that takes consumers directly to the point below or on another page that shows the 

amounts of those charges. Fare advertisements that do not include an explanation or a 

hyperlink to an explanation regarding the additional taxes and surcharges applicable to 

the advertised base fare do not comply with section 399.84 and the Department case 

precedent. Violations of 14 CFR 399.84 constitute unfair and deceptive practices in 

violation of 49 U.S.C. § 41712. 3

In addition, as detailed in 49 CFR Part 1510, there are specific disclosure requirements 

pertaining to the September 11th Security Fee of $2.50 per enplanement on passengers of 

domestic and foreign carriers in air transportation originating at airports in the United 

States. Pursuant to section 1510.7, air carriers and foreign air carriers are specifically 

required to identify and ensure that their agents identify this fee as the “September 11th

Security Fee” in all advertisements and solicitations for air transportation where it is not 

included in the advertised base fare. This office considers the failure of a carrier or ticket 

agent to identify the September 11th Security Fee as required by the rule to constitute a 

separate and distinct unfair and deceptive practice in violation of 49 U.S.C. § 41712.4

Background

Sceptre Tours is a New York corporation specializing in offering comprehensive travel 

packages that include airfare, hotel, guided tours and other amenities to Ireland and other 

European destinations. Sceptre Tours promotes its air-inclusive travel packages through 

its website, www.sceptretours.com. A recent review of Sceptre Tours’ website by the 

Office of Aviation Enforcement and Proceedings (Enforcement Office) disclosed 

numerous instances where Sceptre Tours failed to comply with the Department’s full-fare 

advertising rule and case precedent. For example, prior to being contacted by the 

Enforcement Office, on the homepage of its website, a window flashed air-inclusive tour 

packages with prices. Sceptre Tours failed to identify with these advertised fares the 

 

2 See In the Matter of Roni Herskovitz, Individually and Ultimate Fares, Inc., Enforcement 

Proceeding, DOT-OST-2009-0002, Order 2009-11-08 (Nov. 9, 2009). See also Department notices 

entitled “Disclosure of Airfare Variations: Web vs. Other Sources; Surcharges that may be Listed 

Separately in Advertisements” (Nov. 4, 2004); “Disclosure of Additional Fees, Charges, and Restrictions 

on Airfare Advertisements, Including ‘Free’ Airfares” (Sept. 4, 2003); and “Prohibition on Deceptive 

Practices in Marketing of Airfares to the Public Using the Internet” (Jan. 18, 2001). 

3

 See, e.g., British Airways, PLC, Violations of 49 U.S.C. § 41712 and 14 CFR 399.84, Order 2003-

6-29 (June 20, 2003). 

4 See, e.g., A Better Fare, LLC, Violations of 49 U.S.C. § 41712 and 14 CFR 399.84, Order 2003-1-

12 (Jan. 16, 2003).
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existence and amounts of separate additional taxes and fees. Instead, consumers were 

presented with a link entitled “get going” in the window to go to the “package 

description” pages. There, without any indication or link proximate to the listed prices, 

Sceptre Tours stated in small print, among all other terms and conditions, that “[s]tated 

prices exclude government taxes/fees/facility charges... and the September 11th Security 

Fee ....” A similar search path was used for packages displayed on other pages of the 

website, such as the “Last Minute Deals Vacation Packages” page and the “Escorted 

Vacations” page. Sceptre Tours’ internet advertisements, as described above, failed to 

comply with section 399.84 and the Department’s enforcement case precedent, which 

also constitute an unfair and deceptive practice in violation of 49 U.S.C. § 41712. 

Mitigation

In mitigation, Sceptre Tours states that while it had been aware of the Department’s 

exception to the full-fare advertising regulation for government imposed taxes and fees, it 

was under the incorrect impression that simply noting the additional fees within the legal 

terms and conditions was sufficient. Sceptre Tours further states that it was never its 

intention to deliberately disregard the Department’s requirements or to mislead customers 

in any way. Furthermore, upon learning that it was out of compliance, Sceptre Tour states 

that it took immediate steps to modify its web site and rectify the situation. 

Decision

The Enforcement Office has carefully considered all of the information available to it, 

including that provided by Sceptre Tours, Inc., but continues to believe that enforcement 

action is warranted. In this connection and in order to avoid litigation, the Enforcement 

Office and Sceptre Tours, Inc., have reached a settlement in this matter. While neither 

admitting nor denying the above allegations, Sceptre Tours, Inc., accepts the findings and 

conclusions stated herein in order to avoid litigation. Under this order, Sceptre Tours, 

Inc., is assessed $30,000 in compromise of potential penalties otherwise assessable under 

the provisions of 49 U.S.C. § 46301. The Enforcement Office believes that the

assessment of a civil penalty of $30,000 is appropriate in view of the nature and extent of

the violations in question, serves the public interest, and establishes a deterrent to future 

similar unlawful practices by Sceptre Tours, Inc., 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 

the order as being in the public interest;

2. We find that Sceptre Tours, Inc., violated 14 CFR 399.84, as described above, 

by causing to be published advertisements on the Internet that failed to state the 

entire price to be paid for the advertised air transportation;
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3. We find that by engaging in the conduct described in paragraph 2, above, 

Sceptre Tours, Inc., engaged in unfair and deceptive practice and an unfair 

method of competition in violation of 49 U.S.C. § 41712;

4. We find that Scepter Tours, Inc., failed to disclose the existence and amount of 

the September 11th Security Fee applicable to the tour packages advertised on its 

website in violation of 49 U.S.C. § 41712; 

5. We order Sceptre Tours, Inc., and all other entities owned and controlled by, or 

under common ownership with Sceptre Tours, Inc., and their successors and 

assignees, to cease and desist from further violations of and 14 CFR 399.84 and 

49 U.S.C. § 41712;

6. We assess Sceptre Tours, Inc., a compromise civil penalty of $30,000 in lieu of 

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

ordering paragraphs 2, 3, and 4, above. Of this total amount, $15,000 will 

become due and payable within 20 days of the issuance of this order. The 

remaining $15,000 will become due and payable if Sceptre Tours, Inc., violates 

this order’s cease and desist provisions within one year following the date of the 

issuance of this order, in which case the entire unpaid portion of the civil 

penalty shall become due and payable immediately. Failure to pay the penalty 

as prescribed in ordering paragraph 7, below, shall subject Sceptre Tours, Inc.,

to the assessment of interest, penalties, and collection charges under the Debt 

Collection Act and to possible enforcement action for failure to comply with 

this order; and

7. Payment shall be made by wire transfer through the Federal Reserve 

Communications System, commonly known as “Fed Wire,” to the account of 

the U.S. Treasury. The wire transfer shall be executed in accordance with the 

instructions contained in the Attachment to 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 

initiative.

BY:

ROSALIND A. KNAPP

Deputy General Counsel

(SEAL) 

An electronic version of this document is available

at www.regulations.gov