BEFORE THE 

U.S. DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

WASHINGTON, D.C. 

Delta Air Lines, Inc. 

Alleged Violations of 14 CFR Part 257 

and 49 U.S.C. § 41712 

Enforcement Proceeding 

Served January 7, 2015 

DOT -OST -2014-0229 

RESPONDENT DELTA AIR LINES' 

MOTION TO DISMISS ENFORCEMENT COMPLAINT 

Pursuant to 14 C.P.R. §§ 302.11 and 302.411, Delta Air Lines hereby moves to 

dismiss the Complaint in the above-captioned proceeding for failure to state a claim upon 

which relief can be granted. For the reasons set forth in the accompanying 

Memorandum, the allegations in the Complaint are insufficient as a matter of law to show 

that Delta violated 49 U.S.C. § 41712 or 14 C.P.R. § 257.5. Delta thus respectfully 

requests that the Complaint be dismissed in its entirety with prejudice. 

J. Scott McClain 

Jon-Peter F. Kelly 

DELTA AIRLINES, INC. 

1030 Delta Boulevard 

Department 981 

Atlanta, GA 30354 

(404) 773-6514 

scott.mcclain@delta.com 

jonpeter.f.kelly@delta.com 

Respectfully submitted, 

Paul D. Clement 

Jeffrey M. Harris 

BANCROFT PLLC 

1919 M Street, NW, Ste. 470 

Washington, D.C. 20036 

(202) 234-0090 

pclement@bancroftpllc.com 

jharris@bancroftpllc.com 

Counsel for Delta Air Lines, Inc. 
BEFORE THE 

U.S. DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

WASHINGTON, D.C. 

Delta Air Lines, Inc. 

Alleged Violations of 

14 C.F.R. Part 257 and 

49 u.s.c. § 41712 

Enforcement Proceeding 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

Served: January 7, 2015 

DOT-OST-2014-0229 

MEMORANDUM IN SUPPORT OF DELTA AIR LINES' 

MOTION TO DISMISS ENFORCEMENT COMPLAINT 

J. Scott McClain 

Jon-Peter F. Kelly 

DELTA AIR LINES, INC. 

1030 Delta Boulevard 

Department 981 

Atlanta, GA 30354 

(404) 773-6514 

scott.mcclain@delta.com 

jonpeter.f.kelly@delta.com 

Paul D. Clement 

Jeffrey M. Harris 

BANCROFT PLLC 

1919 M Street, NW, Ste. 470 

Washington, D.C. 20036 

(202) 234-0090 

pclement@bancroftpllc.com 

jharris@bancroftpllc.com 

Counsel for Delta Air Lines, Inc. 
TABLE OF CONTENTS 

TABLE OF AUTHORITIES .............................................................................................. ii 

INTRODUCTION AND SUMMARY OF ARGUMENT ................................................. .! 

STATEMENT OF ALLEGED FACTS .............................................................................. .4 

STANDARD OF REVIEW ................................................................................................. 5 

ARGUMENT ....................................................................................................................... 5 

I. The Facts Alleged In The Enforcement Complaint Are Insufficient 

To Show That Delta Engaged In An Unfair Or Deceptive Practice ........................ 5 

A. The Relevant Statute and Regulation Simply Require 

Disclosure "Prior to the Purchase of a Ticket" or "Before 

Booking Transportation." ............................................................................ 5 

B. The Allegations in the Complaint Are Insufficient as a Matter of 

Law To Show That Delta Failed To Provide Disclosures "Prior 

to the Purchase of a Ticket" or "Before Booking Transportation." ............. 7 

II. Delta Cannot Be Held Liable For Violating Purported Rules That Are Not 

Included In The Text Of The Relevant Statute And Regulation ............................. 9 

A. Statements in the 1999 Regulatory Preamble Cannot Trump the 

Unambiguous Text of the Regulation .......................................................... 9 

B. Even ifthe Statute and Regulation Were Ambiguous, the 

Complaint Fails To Show That Delta's Actions Were Inconsistent 

With Any Statements in the 1999 Preamble .............................................. 11 

C. Delta Cannot Be Held Liable for Violating a "First Mention" 

Rule That DOT Expressly Declined To Adopt in the 1999 

Rulemaking ................................................................................................ 14 

CONCLUSION .................................................................................................................. 15 
TABLE OF AUTHORITIES 

Cases 

Ashcroft v. Iqbal, 556 U.S. 662 (2009) ................................................................................ 5 

Bell Atlantic v. Twombly, 550 U.S. 544 (2007) ................................................................... 5 

El Comite Para El Bienestar v. Warmerdam, 539 F.3d 1062 (9th Cir. 2008) .................. .10 

FDA v. Brown & Williamson, 529 U.S. 120 (2000) ......................................................... .15 

Wyo. Outdoor Council v. US. Forest Service, 165 F.3d 43 (D.C. Cir. 1999) .................. .10 

Statute 

49 U.S.C. § 41712 ...................................................................................................... passim 

Regulations 

14 C.P.R.§ 257.5 ...................................................................................................... passim 

14 C.P.R.§ 259.5 ........................................................................................................... 8, 11 

14 C.P.R. § 302.411 ............................................................................................................. 5 

Disclosure of Code-Sharing Arrangements and Long-Term Wet Leases, 

64 Fed. Reg. 12,838 (Mar. 15, 1999) ................................................................. 9, 11, 14 

Notice of Proposed Rulemaking, Transparency of Airline Ancillary Fees and Other 

Consumer Protection Issues, 79 Fed. Reg. 29,970 (May 23, 2014) ........................... .15 

Other Authorities 

Alaska Airlines, Order 2014-6-15 (Dep't of Transportation June 27, 2014) ..................... 13 

American Heritage Dictionary (5th ed. 2014) ..................................................................... 6 

Black's Law Dictionary (9th ed. 2009) ................................................................................ 6 

Oxford Dictionary of English (3d ed. 201 0) ........................................................................ 6 

United Airlines, Order 2009-7-6 (Dep't of Transportation July 9, 2009) .......................... 13 

Webster's Unabridged Dictionary (2d ed. 2001) ................................................................ 6 

David C. Vladeck, The Emerging Threat of Regulatory Preemption, American 

Constitution Society Issue Brief (Jan. 2008) ............................................................... 10 

11 
INTRODUCTION AND SUMMARY OF ARGUMENT 

In its Enforcement Complaint, the Office of Aviation Enforcement and Proceedings 

("Office") accuses Delta Air Lines of engaging in unfair or deceptive practices with respect 

to its marketing of code-share flights. The Office does not allege that any actual customer 

was deceived or confused by Delta's disclosures regarding code-share flights. Instead, the 

Office relies solely on eight "secret shopper" calls placed by DOT employees seeking to 

drum up violations. That evidence does not come close to showing that Delta engaged in 

unfair or deceptive practices. 

The relevant statute and regulation are crystal clear: if a flight is being operated 

through a code-share arrangement, a ticket agent speaking to a customer must disclose the 

corporate name and business name of the code-share carrier "prior to the purchase of a 

ticket," 49 U.S.C. § 41712(c), or "before booking transportation," 14 C.P.R. § 257.5(b). 

That is, the disclosure obligation is keyed to a specific and well-defined event-booking 

or purchase-and a carrier must simply make the code-share disclosure at some point 

"before" that event has occurred. 

The secret shopper calls alleged in the Complaint are insufficient as a matter oflaw 

to show that Delta violated the statute or regulation. The Office readily concedes that its 

secret shoppers had no intention of ever booking a ticket, and that they "closed each 

conversation without booking a flight." Complaint ,-r 28. As a result, the permissible time 

window in which Delta could make the code-share disclosures still had not closed. There 

is no reason to believe that Delta's reservation agents would not have made the required 

disclosures at some point "before booking transportation" or "prior to the purchase of a 

ticket" if the calls had continued. As a matter of both law and common sense, a person 

cannot be penalized for non-compliance with an obligation when the time for compliance 

has not yet expired. If a street sign allows parking "before 5:00 p.m.," a person could 
obviously not be ticketed for parking there at 4:15p.m., or even 4:59p.m. Yet the Office 

attempts to rely on a similarly flimsy and illogical theory to justify a $660,000 civil penalty 

against Delta. 

Unsurprisingly, the Complaint does not even attempt to argue that Delta violated 

the actual text of the relevant statute and regulation. Instead, the Office relies heavily on a 

1999 regulatory preamble for the proposition that code-share disclosures must be made not 

just before a booking or purchase is made, but at some (unspecified) earlier point in the 

call. Those arguments are deeply flawed on a number of levels. At the outset, the text of 

§ 41712(c) and § 257.5(b) is unambiguous about the time period for making the 

disclosures, so it is inappropriate to consider extraneous materials at all. Courts have 

repeatedly rejected administrative agencies' attempts to use informal sources such as 

regulatory preambles to depart from the clear text of a regulation. 

In all events, even if the regulation were ambiguous, the regulatory preamble does 

not support the Office's position. The preamble simply recognizes that it is insufficient for 

a carrier to "read back" the code-share disclosure to the customer as a confirmation after a 

purchase or reservation has been made. That rule is entirely consistent with the text of the 

regulation. After all, if a carrier provides the code-share disclosure only while confirming 

a completed reservation, it has failed to provide disclosure "before booking transportation." 

This uncontroversial statement in the preamble thus provides no basis for requiring carriers 

to make code-share disclosures at some point even earlier in the call than just "before 

booking" or "prior to purchase." 

The Complaint also cites a statement in the 1999 preamble suggesting that carriers 

must make code-share disclosures during the so-called "information and decisionmaking" 

portion of a call. But that statement, too, is entirely consistent with the text of the 

2 

Delta Motion To Dismiss 
regulation. Until a booking or purchase has been made, everything is the "information and 

decisionmaking" portion of the call. Indeed, the ultimate "decision" at the end of the 

"decisionmaking process" is the decision to purchase a ticket, and as long as the disclosure 

occurs before that decision is made, it necessarily occurs during the "decisionmaking 

process." For example, even if a carrier provided the code-share disclosure at the very last 

moment before the purchase was finalized, the customer would still be fully informed about 

the code-share arrangement ("information") and would have the opportunity to change her 

mind or choose a different flight if she did not wish to travel on the code-share carrier 

("decisionmaking"). Thus, even if the relevant time period is "information and 

decisionmaking," the Office's secret shopper evidence is insufficient to show that Delta 

committed a violation. Each and every one of the eight phone calls was discontinued by 

the caller while the "information and decisionmaking" portion ofthe call was still ongoing. 

* * * 

At bottom, although the Office does not specify exactly when it believes Delta 

should have made the code-share disclosures to avoid violating the regulation, it is clear 

the Office believes Delta should have provided the disclosures at the first mention of a 

flight. That is astonishing, as the Office's position is nearly identical to a rule proposed by 

a commenter that DOT did not adopt in the 1999 rulemaking. Needless to say, Delta cannot 

be held liable for a substantial civil penalty for failing to comply with a rejected proposal. 

If DOT believes that more aggressive rules for code-share disclosures are needed, 

then it can and should change its regulations on a prospective basis; in fact, DOT is 

currently considering a proposal that would amend § 257 .5(b) to expressly impose a 

requirement that the disclosure occur when a flight is "first offered" to the customer during 

the call. But there is no basis whatsoever for saddling Delta with a $660,000 civil penalty 

3 

Delta Motion To Dismiss 
for failing to comply with purported requirements that appear nowhere in the text of the 

regulations as currently written. The Complaint should be dismissed in its entirety with 

prejudice. 

STATEMENT OF ALLEGED FACTS 

On December 23,2014, the Office filed an Enforcement Complaint accusing Delta 

of failing to provide adequate disclosures regarding code-share flights. The Complaint 

relies solely on eight phone calls placed by DOT staff members who had no intention of 

ever booking a ticket. See Complaint ,-r,-r 26-28. Each of those calls followed the same 

basic script. The caller had a "target flight" that was known to be operated through a codeshare arrangement, and would ask the reservation agent questions until the flight had been 

identified. Id. After the callers received information about the flight such as the flight 

number, time of arrival, time of departure, and price, they "closed each conversation 

without booking a flight." Id. ,-r 28. The Complaint alleges that Delta committed unfair or 

deceptive acts because its reservation agents did not provide the code-share disclosures 

before the secret shoppers had discontinued their calls. 

The Complaint seeks to assess Delta with three sets of civil penalties for each of 

the eight phone calls. Even though the underlying conduct involves the same eight phone 

calls, the Office claims that it is entitled to separate civil penalties for: (1) alleged 

violations of 49 U.S.C. § 41712(c) and 14 C.P.R. § 257.5; (2) alleged violations of 49 

U.S.C. § 41712(a); and (3) alleged violations of a 2010 consent order. See Complaint 

,-r,-r 29-31. And the Complaint seeks the maximum penalty of$27,500 for each of the eight 

alleged violations, for each of these three categories, for a total penalty of $660,000. 

4 

Delta Motion To Dismiss 
STANDARD OF REVIEW 

Under DOT's regulations, a motion to dismiss an enforcement complaint shall be 

adjudicated "in accordance with the Federal Rules of Civil Procedure," including Rule 12. 

14 C.P.R. § 302.411(a). To survive a motion to dismiss for failure to state a claim under 

Rule 12(b )( 6), the complaint must articulate "enough facts to state a claim to relief that is 

plausible on its face." Bell Atlantic v. Twombly, 550 U.S. 544, 570 (2007). The allegations 

in the complaint must be accepted as true, but the plaintiff must "plead[] factual content 

that allows the court to draw the reasonable inference that the defendant is liable for the 

misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 

ARGUMENT 

I. The Facts Alleged In The Enforcement Complaint Are Insufficient To Show 

That Delta Engaged In An Unfair Or Deceptive Practice. 

A. The Relevant Statute and Regulation Simply Require Disclosure "Prior 

to the Purchase of a Ticket" or "Before Booking Transportation." 

49 U.S.C. § 41712(c)(l) provides that it is an unfair or deceptive practice for a 

ticket agent to "fail to disclose, whether verbally in oral communication or in writing in 

written or electronic communication, prior to the purchase of a ticket- (A) the name of 

the air carrier providing the air transportation; and (B) if the flight has more than one flight 

segment, the name of each air carrier providing the air transportation for each such flight 

segment." DOT's regulations similarly provide: 

In any direct oral communication in the United States with a prospective consumer 

and in any telephone calls placed from the United States concerning a flight that is 

part of a code-sharing arrangement or long-term wet lease, a ticket agent doing 

business in the United States or a carrier shall tell the consumer, before booking 

transportation, that the transporting carrier is not the carrier whose designator code 

will appear on the ticket and shall identify the transporting carrier by its corporate 

name and any other name under which that service is held out to the public. 

14 C.P.R. § 257.5(b) (emphasis added). 

5 

Delta Motion To Dismiss 
These provisions are clear, straightforward, and unambiguous in terms of both the 

substance and timing of the required disclosures. In terms of substance, a carrier selling a 

ticket on a code-share flight must tell the customer the corporate name of the carrier 

operating the flight and the name under which that carrier does business. And, in terms of 

timing, a reservation agent speaking to a customer must simply make the required 

disclosures at some point "prior to the purchase of a ticket" or "before booking 

transportation." 

To "purchase" means to "buy" or "acquire (something) by paying for it." Oxford 

Dictionary of English (3d ed. 2010); see also American Heritage Dictionary (5th ed. 2014) 

(defining "purchase" as "obtain in exchange for money or its equivalent; buy"); Webster's 

Unabridged Dictionary (2d ed. 2001) ("[t]o acquire by the payment of money or its 

equivalent; buy"). Similarly, to "book" means to "reserve (accommodation, a place, etc.)," 

or "buy (a ticket) in advance." Oxford Dictionary of English (3d ed. 2010); see also 

American Heritage Dictionary (5th ed. 2014) (defining "book" as "arrange for or purchase 

(tickets or lodgings, for example)"); Webster's Unabridged Dictionary (2d ed. 2001) ("[t]o 

reserve or make a reservation for"); cf Black's Law Dictionary (9th ed. 2009) (defining 

"book" as "[t]o engage (someone) contractually"). 

The statute and regulation thus establish a clear, workable, bright-line rule for when 

the required disclosure of code-share arrangements must be made: before a ticket has been 

purchased or before a reservation has been made. That rule is eminently reasonable, as it 

ensures that customers will have the pertinent information about code-share flights before 

the reservation is finalized and before payment is made. No money will change hands 

unless and until the customer has received the disclosure. And because the code-share 

disclosure must be provided before a booking is made, the customer will still have an 

6 

Delta Motion To Dismiss 
opportunity to change her mind and choose a different flight if she does not wish to fly on 

the carrier operating the code-share flight. 

B. The Allegations in the Complaint Are Insufficient as a Matter of Law 

To Show That Delta Failed To Provide Disclosures "Prior to the 

Purchase of a Ticket" or "Before Booking Transportation." 

The facts alleged in the Complaint do not come close to showing that Delta failed 

to disclose code-share information as required by 49 U.S.C. § 41712(c)(l) and 14 C.P.R. 

§ 257.5(b). The Office does not identify a single actual Delta customer who booked or 

purchased a ticket without receiving the required disclosures. Instead, the Office relies 

solely on eight "secret shopper" calls made by DOT employees. Each call followed the 

same basic script. The secret shoppers engaged in brief conversations with Delta 

reservation agents in which they attempted to get the agents to mention a "target flight." 

Complaint ,-r 27. After the reservation agent identified the target flight and provided details 

such as its flight number, departure time, arrival time, and price, the secret shoppers "closed 

each conversation without booking a flight." Id. ,-r 28. 

These allegations are insufficient as a matter of law to show that Delta violated the 

statute or regulation regarding code-share disclosures. As noted, § 41712( c) and § 257 .5(b) 

simply require the disclosures to be made before a specific, discrete, well-defined event 

has occurred-purchasing a ticket or booking transportation. Under the clear and 

unambiguous text of the statute and regulation, a carrier has up until that time to provide 

the disclosures. 

Even though the statute and regulation are expressly linked to "booking" or 

"purchase," DOT's secret shoppers did not even attempt to make a booking or reservation, 

much less complete that process. Because the secret shoppers never attempted to book 

flights or purchase tickets, there is no reason to believe that Delta's reservation agents 

7 

Delta Motion To Dismiss 
would have failed to make the required disclosures within the permissible time period if 

the calls had continued. For example, Delta's reservation agents could have made the 

disclosure after the customer had tentatively selected a flight but before the ticket had been 

finalized and booked. That disclosure clearly would have been consistent with the text of 

§ 41712(c) and § 257.5(b) because it would have made "before booking transportation" 

and "prior to the purchase of a ticket." Yet we have no way of knowing whether such a 

disclosure would have been made because the Office's secret shoppers discontinued their 

calls before the time period for making the required disclosures had elapsed. 1 

The insufficiency of the Office's "proof' should be both obvious and noncontroversial. If an agency promulgated a new rule that required regulated parties to come 

into compliance "before December 31, 2015," the agency could obviously not establish a 

violation by showing that a party was not complying on July 1, 2015. The fact that a party 

was not complying on July 1st would be every bit as consistent with a plan to comply by 

December 31st as it would be with non-compliance on December 31st. Or consider a 

hypothetical regulation that required carriers' reservation agents to disclose code-share 

information "within one minute of first mentioning the flight." If the Office's secret 

shoppers ended their calls 30 seconds after the reservation agent first mentioned the flight, 

this would plainly be insufficient to show that the carrier violated the regulation. 

1 The secret shoppers easily could have made bookings without incurring any costs. 

DOT requires carriers to "allow[] reservations to be held at the quoted fare without 

payment, or cancelled without penalty, for at least twenty-four hours after the reservation 

is made if the reservation is made one week or more prior to a flight's departure." 14 

C.F.R. § 259.5(b)(4). Or the secret shoppers could have booked refundable tickets and 

gotten a refund shortly thereafter. Either way, given that the Office was purporting to 

enforce a regulation that is expressly tied to "booking," it is baffling that the secret shoppers 

would "close[] each conversation without booking a flight." Complaint~ 28. 

8 

Delta Motion To Dismiss 
The statute and regulation regarding code-share disclosures are materially 

indistinguishable from these hypothetical rules. When a regulation imposes a duty that 

must be performed within a specific, enumerated time period, but that time period has not 

yet elapsed, the agency cannot show that the obligation was violated. Here, the fact that 

Delta did not make the code-share disclosure as of some earlier point that is still within the 

permissible time window is insufficient on its face to establish a violation. As a matter of 

law, logic, and common sense, the Office's allegations and evidence are patently 

insufficient to show that Delta failed to disclose code-share arrangements "before booking 

transportation" or "prior to the purchase of a ticket." 

II. Delta Cannot Be Held Liable For Violating Purported Rules That Are Not 

Included In The Text Of The Relevant Statute And Regulation. 

The Complaint makes no serious attempt to explain how Delta's actions violated 

the plain text of§ 41712(c) and§ 257.5(b). Instead, the Office's primary legal argument 

is that Delta failed to comply with certain statements made by DOT in a 1999 regulatory 

preamble. See Complaint~~ 20-23 (citing Disclosure ofCode-Sharing Arrangements and 

Long-Term Wet Leases, 64 Fed. Reg. 12,838 (Mar. 15, 1999)). That is wrong for several 

independent reasons. At the most basic level, the statute and regulation are crystal clear 

about the permissible time window for making code-share disclosures, and thus cannot be 

trumped by any statements made in a regulatory preamble. But, in all events, even if the 

preamble reflects an accurate statement of the law, DOT's allegations and evidence are still 

insufficient to show that Delta committed a violation. 

A. Statements in the 1999 Regulatory Preamble Cannot Trump the 

Unambiguous Text of the Regulation. 

Under longstanding principles of administrative law, statements in a regulatory 

preamble cannot trump the text of a regulation. As the Ninth Circuit has explained, a 

9 

Delta Motion To Dismiss 
regulatory preamble has "little legal traction" and "should not be considered unless the 

regulation itself is ambiguous." El Comite Para El Bienestar v. Warmerdam, 539 F.3d 

1062, 1070 (9th Cir. 2008). That court squarely rejected an attempt to "emphasiz[e] the 

language of the preamble above all else." !d. at 1071. The D.C. Circuit has similarly 

emphasized that "language in the preamble of a regulation is not controlling over the 

language of the regulation itself" Wyoming Outdoor Council v. U.S. Forest Service, 165 

F.3d 43, 53 (D.C. Cir. 1999) (emphasis added). Statements in a preamble "[do] not 

'control' the meaning of the regulation," and-at most--can serve as "evidence" of the 

regulation's meaning ifthere is some ambiguity. !d. 2 

Here, as explained above, there is no ambiguity in the text of 49 U.S.C. § 41712(c) 

and 14 C.P.R. § 257.5. An airline can fully comply with its code-share disclosure 

obligations as long as it makes the necessary disclosures "prior to the purchase of a ticket" 

or "before booking transportation." That is a workable, bright-line rule that provides 

carriers clear notice of the time period within which the disclosures must be made. Because 

the text of the statute and regulation are clear and unequivocal regarding the timing of the 

required disclosures, any other sources purporting to set a different time period for 

compliance should not be considered at all. 

2 Academic commentators have also sharply criticized excessive reliance on 

regulatory preambles. For example, Prof. David Vladeck, the former Director of the 

Bureau of Consumer Protection at the FTC, has criticized agencies' attempts to achieve 

policy goals by "simply including statements in lengthy and obscure preambles in Federal 

Register notices." David C. Vladeck, The Emerging Threat of Regulatory Preemption, 

American Constitution Society Issue Brief at 1 (Jan. 2008) (available at 

https://www .acslaw .org/ sites/ default/files/Vladeck _Issue_ Brief. pdf). Prof. Vladeck also 

criticized regulatory preambles as "lengthy and jargon-filled explanations of agency 

regulatory action" that are insufficiently "transparent." !d. at 13. 

10 

Delta Motion To Dismiss 
B. Even if the Statute and Regulation Were Ambiguous, the Complaint 

Fails To Show That Delta's Actions Were Inconsistent With Any 

Statements in the 1999 Preamble. 

Because there is no ambiguity in the text of the statute and regulation, the plain text 

is controlling and the 1999 preamble should not be considered. But even if statements in 

the preamble could serve as the basis for imposing civil penalties, the Office still cannot 

show that Delta committed a violation. 

Citing the 1999 preamble, the Office contends that Delta was required to provide 

notice of code-share arrangements during the so-called "information and decisionmaking 

portion of the conversation." Complaint 11f 20 (quoting 64 Fed. Reg. at 12,845-46). The 

preamble further states that a carrier "may not wait until after the consumer has decided to 

make the reservation or purchase the ticket and disclose the code-sharing arrangement only 

when reading back the flight information." Id. 

Even if those statements are an accurate description of the law, the Office's secret 

shopper evidence does not show that Delta violated them. The quoted statements from the 

preamble simply reaffirm that it is insufficient for a carrier to "read back" information 

about a code-share arrangement after the customer has made a reservation or purchased a 

ticket. That is an eminently reasonable rule, and is consistent with the text of the statute 

and regulation. Information about a code-share arrangement is much less useful to the 

consumer if it is only provided as a "confirmation" after the ticket has been purchased. 3 

3 When DOT adopted§ 257.5(b) in 1999, it was especially critical for code-share 

disclosures to be made before booking or purchase because, depending on the rules of the 

ticket, the customer might incur a penalty to make any changes to the itinerary. But, as 

noted above, DOT has since adopted a rule that allows customers to cancel most tickets 

without penalty within 24 hours of booking. See 14 C.P.R.§ 259.5(b)(4). Thus, even if a 

carrier did not provide the code-share disclosure until it was confirming an alreadycompleted booking, the customer would still have 24 hours to cancel the reservation and 

choose a different flight. 

11 

Delta Motion To Dismiss 
The regulatory preamble thus reaffirms what the text of§ 41712(c) and§ 257.5(b) already 

makes clear: that the disclosure must be provided at some point before the reservation or 

purchase has been completed, not as an after-the-fact confirmation. 

The Office is also flatly wrong to suggest that Delta failed to comply with 

statements in the preamble suggesting that code-share disclosures must be provided during 

the so-called "information and decisionmaking portion" of a call. See Complaint~ 21. The 

"information and decisionmaking" phase of the call necessarily continues until a booking 

or purchase has been made. For example, as noted above, a carrier can comply with 

§ 41712(c) and§ 257.5(b) by providing the code-share disclosure after a customer has 

tentatively selected a flight but before the booking or purchase is finalized. Such a 

disclosure is unquestionably provided during the "information and decisionmaking" 

portion of the call because the customer is notified about the code-share arrangement 

("information") and has the opportunity to change her mind after receiving the disclosure 

if she does not wish to travel on the code-share carrier ("decisionmaking"). Indeed, the 

"decision" at the end of the "decisionmaking process" is the decision to purchase a ticket, 

and as long as the disclosure occurs before that ultimate decision is made, it has been 

provided during the "information and decisionmaking portion" of the conversation.4 

Thus, even if the 1999 preamble establishes an obligation to provide code-share 

disclosures during the "information and decisionmaking portion" of a call, the Office's 

secret shopper evidence does not show that Delta violated this obligation. Each and every 

4 For the same reason, the Office does not move the ball by noting that that 

§ 257.5(b) refers to "prospective" customers. See Complaint~ 22. Until a purchase or 

reservation has been finalized, every call necessarily involves a "prospective" customer. 

The regulation's reference to "prospective" customers thus hardly supports a rule requiring 

disclosures at some (unspecified) early point in the call. A carrier complies with the 

regulation as long as it makes the disclosure before booking or purchase, full stop. 

12 

Delta Motion To Dismiss 
one of the eight calls was discontinued while the "information and decisionmaking" portion 

of the call was still in progress. The evidence cited in the Complaint is thus insufficient as 

a matter of law to show that Delta failed to provide the code-share information during the 

"information and decisionmaking" portion of the calls. 

The Office also contends that "consumers are entitled to information about the 

identity of the operating carrier, regardless of whether they ultimately book a flight." 

Complaint ,-[ 23 (emphasis added). But it strains credulity to argue that a booking is 

unnecessary and irrelevant under a regulation that requires disclosure "before booking." 

The purpose of the disclosure requirement is to ensure that customers are fully informed 

about code-share arrangements before they make the decision to buy a ticket. But there is 

obviously no consumer harm-and, in tum, no violation of the statute or regulation-if the 

carrier fails to provide a code-share disclosure to someone who does not actually purchase 

a ticket. In all events, Congress expressly wrote § 41712( c) in terms of "purchases" and 

DOT expressly wrote § 257.5(b) in terms of "bookings." The Office's surprising claim 

that purchase and booking are unnecessary is little more than an attempt to write this 

seemingly clear language out of the statute and regulation. 

Finally, the Office cites various consent orders with other carriers in support of its 

interpretation of the law, see Complaint ,-r 24, but those prove nothing other than the fact 

that the targets of the investigations chose to settle rather than litigate. Indeed, in several 

of those proceedings, the carrier did not even admit that it had violated the code-share 

disclosure rules. See Alaska Airlines, Order 2014-6-15 at 3 (June 27, 2014) (carrier settled 

"[i]n order to avoid litigation, and without admitting or denying that any violation 

occurred"); United Airlines, Order 2009-7-6 at 2 (July 9, 2009) (carrier settled "without 

admitting any alleged violations"). For all the reasons set forth in this motion and in Delta's 

13 

Delta Motion To Dismiss 
Answer, Delta emphatically denies that the eight phone calls cited in the Complaint reflect 

a violation of§ 41712 or§ 257.5(b). 

C. Delta Cannot Be Held Liable for Violating a "First Mention" Rule That 

DOT Expressly Declined To Adopt in the 1999 Rulemaking. 

IfDOT wanted code-share disclosures to be made at an even earlier point than just 

"before booking transportation" or "prior to the purchase of a ticket," it easily could have 

written its regulations to impose such a requirement. Indeed, several commenters proposed 

just that during the rulemaking process that culminated in the existing regulation. 

American Airlines argued that DOT should require disclosure of a code-share arrangement 

each and every time a reservation agent "offers or refers to a code-sharing flight, regardless 

of whether a booking is made by the prospective customer." 64 Fed. Reg. at 12,845. And 

TWA argued that "notice should be offered at the first instance that the schedule is 

offered." Id. (emphasis added). DOT was well aware of those proposals, but nonetheless 

chose not to incorporate them into the text of the final regulation, which simply requires 

disclosure "before booking transportation." 14 C.P.R.§ 257.5(b). 

The Office is effectively seeking to penalize Delta for failing to comply with 

proposed rules that were not enacted during the rulemaking process. The Office does not 

specify in the Complaint exactly when during the eight phone calls it believes Delta should 

have made the code-share disclosures in order to avoid a violation. But the Office did tip 

its hand about its legal theory in an earlier letter to Delta before filing the Complaint. See 

Exhibit A (Apr. 7, 2014 letter). In that letter, the Office stated that "section 41712(c) and 

section 257 .5(b) require that oral code-share disclosures be provided when an agent first 

mentions a code-share flight in response to a consumer inquiry." Id. (emphasis added). 

That is astonishing, as the Office's legal theory is nearly identical to the rule that TWA 

proposed-but DOT did not adopt-in the 1999 final rule. 

14 

Delta Motion To Dismiss 
Indeed, DOT is currently considering a proposal that would make this exact change 

to its regulations. In May 2014, DOT issued a notice of proposed rulemaking that would 

amend§ 257.5(b) to require reservation agents to make the code-share disclosure "the first 

time that such a flight is offered to the consumer." Notice of Proposed Rulemaking, 

Transparency of Airline Ancillary Fees and Other Consumer Protection Issues, 79 Fed. 

Reg. 29,970, 29,999 (May 23, 2014) (emphasis added). Of course, this amendment to the 

regulation would be entirely unnecessary and redundant if the regulation already meant 

what the Office claims it means. See, e.g., FDA v. Brown & Williamson, 529 U.S. 120, 

147 (2000) (fact that Congress "considered and rejected several proposals to give the FDA 

the authority to regulate tobacco" suggests that FDA did not possess such authority under 

the statute as written). 

* * * 

If DOT believes that its current regulations are inadequate or that it is sound policy 

for code-share disclosures to be made the first time a flight is offered during the call, then 

it can and should change its regulation as proposed in the May 2014 NPRM. That would 

at least provide clear notice to air carriers, on a prospective basis, about exactly what 

carriers are required to do to comply. But there is no basis whatsoever for seeking $660,000 

of civil penalties from Delta for purported violations of a requirement that appears nowhere 

in the text of the statute and regulation as currently written. 

CONCLUSION 

For all of the foregoing reasons, the Enforcement Complaint should be dismissed 

in its entirety with prejudice. 

15 

Delta Motion To Dismiss 
J. Scott McClain 

Jon-Peter F. Kelly 

DELTA AIR LINES, INC. 

1030 Delta Boulevard 

Department 981 

Atlanta, GA 30354 

(404) 773-6514 

scott.mcclain@delta.com 

jonpeter.f.kelly@delta.com 

Respectfully submitted, 

Paul D. Clement 

Jeffrey M. Harris 

BANCROFT PLLC 

1919 M Street, NW, Ste. 470 

Washington, D.C. 20036 

(202) 234-0090 

pclement@bancroftpllc.com 

jharris@bancroftpllc.com 

Counsel for Delta Air Lines, Inc. 

16 

Delta Motion To Dismiss 
EXHIBIT A 
u.s. Department 

of Transportation 

Office of the Secretary 

of Transportation 

GENERAL COUNSEL 

April 7, 2014 

1200 New Jersey Avenue, SE 

Washington, DC 20590 

Via J<:mail and Certified Mail- Return Receipt Requested 

Jon-Peter F. Kelly 

Assistant General Counsel 

Delta Air Lines, lnc. 

Department 981 

l 030 Delta Boulevard 

Atlanta, GA 30354-1989 

Dear Mr. Kelly: 

Re: Notice of Code-share 

Disclosure Violations 

The Office of Aviation Enforcement and Proceedings (Enforcement Office) recently 

conducted an investigation that revealed numerous violations by Delta Air Lines, Inc. 

(Delta), of the Department's code-share disclosure rule, 14 CFR Part 257, and the 

statutory prohibition against unfair and deceptive practices, 49 U.S.C. § 41712. 

As an air carrier, Delta is subject to the detailed code-share disclosure requirements found 

in 49 U.S.C. § 41712(c) and 14 CFR 257.5(b). Under section 41712(c), air carriers are 

required to disclose "whether verbally in oral communication or in writing in written or 

electronic communication, prior to the purchase of a ticket[,] the name of the air carrier 

providing the air transportation; and if the flight has more than one segment, the name of 

each air carrier providing the air transportation for each such flight segment." Failure to 

disclose these requirements is an unfair and deceptive practice in violation of 

49 U.S.C. § 41712(a). Section 257.4 of the code-share disclosure rule states that the 

holding out or sale of scheduled passenger air transportation involving a code-sharing 

arrangement is an unfair and deceptive practice in violation of 49 U.S.C. § 41712, unless, 

in conjunction with that holding out or sale, carriers and agents follow certain notice 

requirements, including those set forth in 14 CFR 257.5(b). With regard to oral 

communications concerning a flight that is part of a code-sharing arrangement, section 

257.5(b) states that a ticket agent or carrier must disclose to prospective consumers 

before they book the flight the existence of the code-sharing arrangement, the corporate 

name of the transporting carrier, and any other name under which the flight is held out to 

the public. 

The purpose of the disclosure is to inform consumers ofthe operating carrier so they have 

that information before making any decisions regarding air transportation. Accordingly, 

section 41712(c) and section 257.5(b) require that oral code-share disclosures be 
2 

provided when an agent first mentions a code-share flight in response to a consumer 

inquiry, including inquiries that may involve only a request for information. 1 

In telephone surveys conducted by the Enforcement Office staff from September 2013 

through February 2014, Delta agents failed to make the full, appropriate disclosures as 

required by section 257.5(b) in eight out of 30 test calls, a failure rate of over 25 percent. 

Violations of 14 CFR Part 257 and 49 U.S.C. § 41712 may subject Delta to the 

assessment of civil penalties under 49 U.S.C. § 46301 of up to $27,500 for each violation 

and $27,500 for each day a violation continues. We also note that in DOT 

Order 2010-07-4 (July 9, 2010), the Department found that Delta engaged in unfair and 

deceptive practices and unfair methods of competition in violation of 49 U.S.C. § 41712 

by failing to disclose code-share arrangements as required by 14 CFR Part 257. In that 

order, the Department directed Delta to cease and desist from future similar violations of 

Part 257. Delta's liability in this matter is therefore substantial. 

We view Delta's noncompliance with the Department's code-share disclosure rule very 

seriously and believe enforcement action is warranted. We have therefore enclosed a 

draft consent order with which we would be willing to settle this matter. Our draft 

proposal, in addition to directing Delta to cease and desist from future violations of 14 

CFR Part 257,49 U.S.C. § 41712 and DOT Order 2010-07-04, calls for an assessment of 

a compromise civil penalty of $200,000. 

We request that Delta review the proposed consent order and advise us within 15 days of 

the date of this letter whether it will agree to settle this matter under its terms. Delta may 

suggest mitigation language if it wishes. In addition, we are willing to consider minor 

editorial revisions to the draft; however, the substance of the order must remain 

unchanged. If we cannot reach an agreement on a consent order similar to that provided 

here, we plan to pursue formal enforcement action. 

If you have any questions about this matter, please contact Robert Gorman of my staff or 

Kimberly Graber, Chief, Consumer Protection and Competition Law Branch, at 

(202) 366-9342. 

Enclosure 

Sincerely, 

/l 

Blane Workie 

Acting Assistant General Counsel for 

Aviation Enforcement and Proceedings 

1 See, e.g., FC USA. inc., d/b/a Liberty Travel, Order 2013-8-25 (August 29, 2013). 
CERTIFICATE OF SERVICE 

I hereby certify that on January 7, 2015, the original and one copy of the foregoing 

Motion To Dismiss Enforcement Complaint and Memorandum in Support thereof were handdelivered to: 

U.S. Department of Transportation 

Dockets Operations, M-30 

West Building, Ground Floor 

Room W12-10 

1200 New Jersey Avenue, S.E. 

Washington, DC 20590 

I further certify that one copy of the foregoing document was hand-delivered to: 

Blane A. W orkie 

Assistant General Counsel for 

Aviation Enforcement and Proceedings, C-70 

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E. (W96-431) 

Washington, DC 20590 

Robert Gorman 

Senior Trial Attorney 

Office of Aviation Enforcement and Proceedings, C-70 

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E. (W96-413) 

Washington, DC 20590 

The Honorable J.E. Sullivan 

Administrative Law Judge 

U.S. Department of Transportation 

Office of Hearings, M-20 

1200 New Jersey Avenue, S.E. (Ell-310) 

Washington, DC 20590 

s/Jeffrey M. Harris 

Jeffrey M. Harris