Order 2012-11-36

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

On the Thirtieth day of November, 2012

Airtrade International, Inc. Docket OST 2012-0002

Served November 30, 2012

Violations of 49 U.S.C. § 41712, 14 CFR 257.5,

and Order 2011-4-21 

CONSENT ORDER

This consent order concerns Internet advertisements by Airtrade International, Inc.,

(“Airtrade”) that failed to disclose code-share arrangements as required by 

14 CFR Part 257 and 49 U.S.C. § 41712(c). These violations also constitute violations of

49 U.S.C. § 41712(a), which prohibits unfair and deceptive practices, and 

Order 2011-4-21, 1 which directs Airtrade to cease and desist from violations of the 

Department’s code-share disclosure regulations. This order directs Airtrade to cease and 

desist from future violations of Part 257, section 41712, and Order 2011-4-21, and 

assesses Airtrade a compromise civil penalty of $150,000. 

Applicable Law

Airtrade is a ticket agent 2 and is therefore subject to the code-share disclosure 

requirements found in 49 U.S.C. § 41712(c) and Part 257. Under section 41712(c), ticket 

agents are required to disclose the name of the operating carrier providing the service for 

each segment of a passenger’s itinerary “on the first display of the Web site following a 

 1

 Airtrade International, Inc., Violations of 49 U.S.C. § 41712 and 14 CFR Part 257, Order 2011-4-21

(April 26, 2011).

2 A “ticket agent” is “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).
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search of a requested itinerary in a format that is easily visible to a viewer.” 

Additionally, section 257.4 of the Department’s code-share disclosure rule states that the 

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

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

conjunction with that holding out or sale, the advertiser follows certain notice 

requirements, including those of 14 CFR 257.5(d). The specific terms of section 257.5(d) 

require that print advertisements, including those published on the Internet, “prominently 

disclose that the advertised service may involve travel on another carrier,” “clearly 

indicate the nature of the service in reasonably sized type,” and “identify all potential 

transporting carriers... by corporate name and by any other name under which that 

service is held out to the public.” Failure to disclose code-share arrangements as required 

by Part 257 and section 41712(c) constitutes an unfair and deceptive practice and unfair 

method of competition in violation of section 41712(a).

Facts and Conclusions

On April 26, 2011, the Department issued Order 2011-4-21 against Airtrade. The order 

found that, for a period of time in 2011, Airtrade failed to comply with 14 CFR Part 257 

and 49 U.S.C. § 41712(c). In addition, it directed Airtrade to cease and desist from 

further violations of 14 CFR Part 257 and 49 U.S.C. § 41712 and assessed Airtrade a 

civil penalty of $50,000.

At the time Order 2011-4-21 was issued, Airtrade appeared to be in compliance with 

section 257.5 of the Department’s code-share disclosure rule and 49 U.S.C. § 41712(c). 

However, a follow-up investigation by the Office of Aviation Enforcement and 

Proceedings (Enforcement Office) found that, for a period of time after April 26, 2012, 

Airtrade had fallen out of compliance and was once again failing to properly disclose the 

existence of code-sharing arrangements when advertising code-share flights operated on 

behalf of a major air carrier by a regional air carrier. Specifically, on two of its Internet 

web sites, www.vayama.com and www.budgetair.com, Airtrade did not display the 

corporate names of the transporting carriers and any other names under which those 

flights were held out to the public during the flight selection and booking process. As a 

result, consumers were unable to learn the identity of the airline that would actually 

operate the aircraft on which they would be flying.

Mitigation

In mitigation Airtrade states that the flight listings on its website that did not disclose 

code-share flights were due to the installation of a third-party software patch that, without 

Airtrade's knowledge, deleted the software that Airtrade had earlier installed to properly 

identify flights involving code-share segments. Airtrade states that once it received 

notice that it was in violation of the Department’s code-share disclosure requirements, it 

promptly brought its website into compliance. Airtrade states that it has taken additional 

measures to test that code-share disclosures are displayed for all flights on its websites, 

according to the information it receives from its GDS provider and/or the airlines. 
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Decision

The Department views compliance with Part 257, 49 U.S.C. § 41712, and 

Order 2011-4-21 seriously. Accordingly, after carefully considering all of the facts in 

this case, including those set forth above, the Enforcement Office believes that 

enforcement action is warranted. The Enforcement Office and Airtrade have reached a 

settlement of this matter in order to avoid litigation. Airtrade agrees to the issuance of 

this order and to cease and desist from similar violations of 49 U.S.C. § 41712, 14 CFR 

Part 257, and Order 2011-4-21 and to the assessment of $150,000 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 serves the public interest. It represents a strong deterrent 

against future noncompliance with the Department’s code-share disclosure requirements. 

This order is issued under the authority contained in 49 CFR Part 1.

ACCORDINGLY,

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

this order as being in the public interest;

2. We find that Airtrade International, Inc., violated 14 CFR 257.5(d) and 

49 U.S.C. § 41712(c) by failing to properly disclose code-sharing arrangements; 

3. We find that by engaging in the conduct and violations described in ordering 

paragraph 2, above, Airtrade International, Inc., engaged in an unfair and 

deceptive trade practice and unfair method of competition in violation of 

49 U.S.C. § 41712(a);

4. We find that by engaging in the conduct and violations described in ordering 

paragraph 2, above, Airtrade International, Inc., violated the cease and desist 

provision of Order 2011-4-21;

5. We order Airtrade International, Inc., and all other entities owned or controlled by, 

or under common ownership and control with Airtrade International, Inc., their 

successors and assignees, to cease and desist from further similar violations of 

49 U.S.C. § 41712, 14 CFR 257.5, and Order 2011-4-21. Failure to comply with 

this cease and desist provision shall subject these entities to further enforcement 

action;

6. We assess Airtrade International, Inc., $150,000 in civil penalties in compromise 

of civil penalties that might otherwise be assessed for the violations found in 

ordering paragraphs 2, 3, and 4 above. Of this total penalty amount, $75,000 shall 

be due and payable as follows: $25,000 shall be due and payable within 15 days 

of the date of issuance of the order, and additional payments of $25,000 each shall 
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be due and payable on January 1, 2013, and February 1, 2013. Any unpaid 

portion of the civil penalty amount shall become due and payable immediately if, 

within one year of the date of issuance of the order, Airtrade International, Inc.,

violates this order’s cease and desist or payment provisions, in which case 

Airtrade International, Inc., may become subject to additional enforcement action 

for any violation of the order; and

7. We order Airtrade International, Inc., to pay the penalty through Pay.gov to the 

account of the U.S. Treasury in accordance with the instructions contained in the 

Attachment to this order. Failure to pay the penalty as ordered shall subject 

Airtrade International, Inc., 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