Orde r 2010-11- 7

''•^JSO * UNITE D STATE S O FAMERIC A

DEPARTMEN T O FTRANSPORTATIO N OFFIC EO FTH ESECRETAR Y WASHINGTON , D.C

. Issue db y th e Departmen t o f Transportatio n O nth e Eight hDa y o f

November , 201 0

Uniqu e Vacations , Inc

.

Violation s o f

4 9 U.S.C

. § 4171 2 an d 1 4 CF R399.8 4 Docke t DOT-OS T 2010-000 5

Serve dNovembe r

8,201 0

CONSEN T ORDE R Thi s consen t

orde r concern s advertisement s b y Uniqu e Vacations , Inc. , ("Uniqu e Vacations" ) tha t

wer e publishe di nprin t an delectroni c medi afo r Sandal s Resort s tha t

violat e th e Departnient' s pric e advertisin g requirenient s specifie d i n sectio n 399.8 4 o f

th e Department' s regulation s (1 4 CF R399.84 ) an dconstitut e unfai r an ddeceptiv e trad e practice s an dunfai r method s o f

conipetitio n i n violatio n o f

4 9 U.S.C

. § 41712

. Thi s orde r direct s Uniqu e Vacation s t o ceas e an d desis t fro mfutur e violation s an dassesse s th e compan y compromis e civi l penaltie s o f

$200,000

. Uniqu e Vacations , a s aticke t agen t sellin g ai r

tou r packages , i s subjec t

t o th e advertisin g requirement s o f Par t 39 9 o f th e Department' s rules

. Unde r 1 4 CF R 399.84 , an y advertisin g tha t state s apric e fo r

ai r transportatio no r

a nai r tou r i s considere dt o b e a n unfai r o r deceptiv e practic e i nviolatio no f 4 9 U.S.C

. § 4171 2 unles s th e pric e state di s th e entir e pric e t o b e pai db y th e custome r t o th e ai r carrie r o r ticke t agen t fo r suc hai r

transportation , tou r

o r tou r component
. However , a s amatte r

o f enforcemen t

policy , th e Departmen t ha s permitte dai r carrier s an dticke t

agent s t o stat e separatel y fro mth e advertise dpric e taxe s an d fee s impose db y agoverimien t o naper-passenge r

basis , suc ha s passenge r facilit y charges , s o lon g a s thei r amount s appea r

o r ar e indicate dclearl y i nth eadvertisemen t s o tha t th e consume r

ca ndetermin e th e ful l pric e t o b e paid. ' Taxe s an dfee s impose do n a na dvalore mbasis , however , mus t b e include di n th e advertise dprice

. Carrier

- o r agent-impose dsurcharges , e.g. , fuel , insurance , an dservic e charges , o r othe r suc hcosts , mus t

b e include di nth e advertise d price

. Wit hrespec t

t o ai r fare s an dai r

tour s advertise do nth e Internet , taxe s an dfee s tha t

ar e permitte dt o b e exclude dfro mth e advertise dpric e ma y b e note di n aprominen t

link , place dproximatel y t o th e state dprice , tha t take s th e viewe r t o th e botto mo f

th e screen , o r

t o aplac e o naseparat e screen , wher e th e natur e an damoun t

o f suc hfee s ar e displayed. ^ Uniqu e Vacation s specialize s i nofferin g trave l packages , whic hinclud e ai r fare , hotel , guide dtours , an drelate damenities , particularl y t o Sandal s an dBeache s resort s i n th e Caribbean , includin g Jamaica , St

. Lucia , Antigu aan dTh e Bahamas. ^ Uniqu e Vacation s ha s promote dit s ai r trave l package s throug h printe dadvertisement s i n newspaper s suc ha s Th e Ne w Yor k Times , trad e magazines , television , flyer s an dothe r mailers , outdoo r

advertising , an db y mean s o f advertisement s tha t

ar e publishe do nvariou s onlin e sites , includin g it s we b site , www.Sandals.com

. A ninvestigatio n b y th e Department' s Offic e o f Aviatio nEnforcemen t an d Proceedin g ("Enforcemen t Office" ) disclose dtha t th e ai r fare s an dai r

tou r package s promote db y Uniqu e Vacation s t o Sandal s Resort s an dit s affiliate s i n advertisement s i n variou s prin t an delectroni c medi adi dno t compl y wit h Departmen t

requirements

. Specifically , Uniqu e Vacation s deceptivel y advertise d"free " ai r

fare s i n connectio nwit hai r plu s lan dpackage s when , i n fact , consumer s woul di n som e case s b e require dt o pa y a namoun t ostensibl y representin g "airlin e costs, " whic hcoul dinclud e "fue l surcharges. " Moreover , Uniqu e Vacation s advertisement s fo r Sandal s Resort s faile dt o provid e adequat e notic e tha t

certai n taxe s an dfee s woul db e assesse do nthes e so-calle d

' See , e.g. , Cost aCruis e Line s N.V. , Orde r 2009-9-3

. ^ See , e.g. , Chin aFocus , Inc. , Orde r 2010-9-6 ; Prestig e Cruis e Holdings , Inc. , Orde r 2010-4-1 ; JT

B Corporation , Orde r

2008-12-24 ; Trafalgar

Tour s West , Orde r

2007-8-24 ; Gran dCircl e Trave l Corp , Orde r 2006-7-23 ; an dorder s cite dtherein , an dth e notic e entitled : Disclosur e o

f Addihona l Fees , Charge s an dRestriction s o nAi r Fare s i n Advertisements , Includin g "Free " Airfares , whic hi s date dSeptembe r 4 , 2003 , a s wel l a s guidanc e letter s t o th e industr y whic hca nb e foun dat : http : / /airconsumer.ost.dot.go v / rules/guidance.htin

. ' Uniqu e Vacations , Inc. , state s tha t i t i s "th e worldwid e representativ e of " an d "provide s advertisin g an dmarketin g services " t o Sandal s Resorts , " agrou p o f aU

inclusiv e hotel s i n th e Caribbean. " Uniqu e Vacation s furthe r state s tha t

"i t doe s no t operate , manag e o r

supervis e an y o

f th e hotels. " Sandal s Resort s Internationa l operate s Sandal s Resort s an dit s affiliates , whic hinclud e Beache s Resort s (ww w .beache s .com) , Th e Roya l Plantation s Collection , an dGran dPineappl e Beac hResorts

."free " ai r fares , an dmus t

b e pai db y th e passenger , o r disclos e th e amoun t

o f thes e "airlin e costs " o r arange . Fo r example , i n connectio n wit hit s advertisemen t i nThe Ne w Yor

k Time s o f a n ai r trave l packag e t o Sandal s Resorts , entitle d"Fl y Free

. Lov e i s i nth e Air, " Uniqu e Vacation s include dth e follov^n g fin e prin t notic e a t

th e botto mo f

th e pag e wher e th e "free " portio no f th e ai r far e i s promoted : *Fl y Fre e offe r

i s . . . fulfille da s credi t towar dlan dportio no f bookin g base do n doubl e occupancy , minimu m3 nigh t stay , $35 0 airfar e pe r

perso n fo r

trave l t o Jamaic ao r

Bahamas , $45 0 pe r

perso n fo r trave l t o St

. Lucia , $55 0 pe r perso nfo r

trave l t o Antigua

. Maximu mtwo-perso n limi t fo r offer

. I nsom e cases , offe r ma y no t cove r al l airlin e costs , taxe s an dfue l surcharges

. Cancellatio n penalties , deposit s an dothe r fee s fo r airfar e ma y apply

. Simila r advertisement s wer e publishe dthousand s o f time s o nth e Internet , i n numerou s majo r

newspaper s an dwer e broadcas t vi atelevisio nthroughou t th e Unite dStates

. I n addition , o nth e Sandal s Resort s we b site

. Uniqu e Vacation s publishe dasimila r

promotio nwit hth e offe r t o "Fl y Fre e t o th e Sandal s Roya l Caribbea n Resor t

an dPrivat e Island, " i nwhic hsimila r violation s wer e evident

. B y advertisin g ai r

fare s a s "free " whe nconsumer s receive donl y alimite ddolla r credi t towar da n ai r

far e an dwoul db e require dt o pa y additiona l airlin e cost s an dfue l surcharge s impose db y carriers , o r othe r surcharge s collecte db y Uniqu e Vacations , an db y failin g t o provid e consumer s adequat e notic e o f taxe s an dfee s (tha t ar e permitte dt o b e state dseparatel y unde r th e Department' s policies , bu t tha t ha dt o b e pai di n orde r t o obtai na"free " ai r

fare)

. Uniqu e Vacation s violate d sectio n399.8 4 an drelate dDepartmen t precedent , an dengage di na nunfai r an d deceptiv e trad e practic e i n violatio no f 4 9 U.S.C

. § 41712

. I n explanatio n an dmitigation , Uniqu e Vacation s state s tha t i t strive s t o conduc t it s busines s i n ful l conformit y wit hal l applicabl e Federa l an dstat e law s an d regulation s an dan y violatio n se t fort hherei nwa s unintentional

. Th e objec t o f th e "Lov e i s I n th e Air " promotion , th e fir mexplains , wa s t o provid e traveler s a credi t towar dth e ful l cos t

o f atrave l package

. It s choic e o f th e phras e "free " ai r fare s i n connectio n wit hthos e ai r plu s lan dpackage s an dth e apparen t statemen t

tha t consxmier s migh t

b e require dt o pa y a namoun t ostensibl y representin g "airlin e costs, " whic hcoul dinclud e "fue l surcharges " wer e inartful , th e fir msays . Uniqu e Vacation s state s furthe r tha t it s researc h indicate s tha t

n o custome r

o f Sandal s Resort s wa s actuall y charge dan y additiona l airlin e surcharges , cost s o r fee s othe r

tha ngovernment-impose dtaxe s an dfees

. Uniqu e Vacation s als o disclose s tha t th e fir mdi dno t

receiv e an y custome r

complaint s regardin g th e challenge dadvertising

. Th e fir mstate s tha ti t

believe s onl y tha t

i t faile dt o identify properl y th e Septembe r 11 * Securit y Fe e o r t o provid e adequat e notic e t o consumer s o f th e natur e an damount , o r a range , o f th e applicabl e government-impose dtaxe s an dfee s tha t the y woul db e require dt o pay . Uniqu e Vacation s declare s tha t i t ha s begu nworkin g i ndept hwdt hth e Nassa u Paradis e Islan dPromotio n Boar dan dother s involve di nthei r join t promotion s o f resort s i n Nassa u t o ensur e complianc e wit hal l o f th e applicabl e Departmen t disclosur e requirements

. Finally , Uniqu e Vacation s state s tha t i nfact , i t

ha s alway s strive dt o conduc t it s marketin g busines s i n complianc e wit hal l applicabl e Departmen t rule s an d regulations

. On e o f

Uniqu e Vacation' s state dcommitments , th e fir mreports , i s t o "avoi dconsume r

confusion, " an di t

believe s tha t

th e numerou s trave l award s tha t i t ha s received , togethe r wit hretur ngues t

statistic s tha t

excee dindustr y standards , ar e reflectiv e o f tha t fact

. Th e Enforcemen t

Offic e ha s carefull y considere dal l o f th e informatio navailabl e t o it , includin g tha t

provide db y Uniqu e Vacations , bu t continue s t o believ e tha t enforcemen t

actio n i s warranted

. I nthi s connectio nan di norde r t o avoi d litigation , th e Enforcemen t Offic e an dUniqu e Vacation s hav e reache da settlemen t

i n thi s matter
. Whil e neithe r admittin g no r

denyin g th e abov e allegations

. Uniqu e Vacation s accept s th e findings an dconclusion s state dherei n i norde r t o avoi dpotentia l litigation

. Unde r thi s order

. Uniqu e Vacation s agree s t o ceas e an ddesis t

fro mfutur e violation s o f 4 9 U.S.C

. §4171 2 an d1 4 CF R 399.84 , an dt o th e assessmen t o f $200,00 0 i ncompromis e o f potentia l penaltie s otherwis e assessabl e unde r th e provision s of

4 9 U.S.C

. § 46301

. O f thi s penalt y amount , $100,00 0 shal l b e du e an dpayabl e a s follows : $40,00 0 shal l b e du e an d payabl e withi n 1 5 day s o f th e dat e o f

issuanc e o f

thi s order ; thre e additiona l payment s o f

$20,00 0 eac hshal l b e du e an dpayabl e o nMarc h15 , 2011 , o n Septembe r

15 , 2011 , an do n Marc h15 , 2012 , respectively

. O f th e remainin g portio no f

th e civi l penalt y amount , $100,00 0 shal l becom e du e an dpayabl e if , withi n eightee n month s o f th e dat e o f

issuanc e o f

thi s order

. Uniqu e Vacation s violate s thi s order' s ceas e an ddesis t provision s o r

fail s t o compl y wit hthi s order' s paymen t

provisions , i nwhic hcase . Uniqu e Vacation s ma y becom e subjec t t o additiona l enforcemen t actio nfo r

violatio no f

th e order

. Th e Enforcemen t

Offic e believe s tha t

th e assessmen t

o f acivi l penalt y o f

$200,00 0 i s appropriat e i n ligh t

o f th e natur e an dexten t o f th e violation s i nquestio nan d wil l provid e a n effectiv e deterren t t o unlawfu l conduc t

i nth e futur e b y Uniqu e Vacation s an dothe r

seller s o f

ai r transportation

. Thi s orde r

i s issue dunde r

th e authorit y containe di n4 9 CF R1.57 aan d1 4 CF R 385.15

.ACCORDINGLY , 1

. Base do n th e abov e discussion , w e approv e thi s settlemen t an dth e provision s o f

thi s orde r

a s bein g i nth e publi c interest ; 2

. W e findtha t

Uniqu e Vacations , Inc. , violate d1 4 CF R399.84 , a s describe dabove , b y causin g t o b e publishe dadvertisement s tha t faile dt o stat e th e entir e pric e t o b e pai db y th e passenge r t o th e firmfo r

certai n ai r transportation ; 3

. W e findtha t

b y engagin g i nth e conduc t describe di nparagrap h2 , above

. Uniqu e Vacations , Inc. , engage di na nunfai r an ddeceptiv e practic e an da n unfai r metho do f

competitio ni nviolatio no f 4 9 U.S.C

. § 41712 ; 4

. W e direc t

Uniqu e Vacations , Inc. , an dal l othe r entitie s owme dan d controlle dby , o r

unde r commo nownershi p an dcontro l wit hUniqu e Vacations , Inc. , an dthei r successor s an dassignees , t o ceas e an ddesis t hro mfutur e violation s o f 1 4 CF R399.8 4 an d4 9 U.S.C

. § 41712 ;

5

. W e asses s Uniqu e Vacations , Inc. , $200,00 0 i ncompromis e o f civi l penaltie s tha t

migh t otherwis e b e assesse dfo r th e violation s foun di n paragraph s 2 an d3 o f

thi s order ; o f

thi s penalt y amotmt , $100,00 0 shal l b e du e an dpayabl e a s follows : $40,00 0 shal l b e du e an dpayabl e withi n 1 5 day s o f th e dat e o f

issuanc e o f

thi s order ; thre e additiona l payment s o f $20,00 0 eac hshal l b e du e an dpayabl e o nMarc h15 , 2011 , o nSeptembe r 15 , 2011 , an do n Marc h15 , 2012 , respectively

. Th e remainin g portio no f th e civi l penalt y amount , $100,00 0 shal l becom e du e an dpayabl e if , withi n eightee n month s o f th e dat e o f

issuanc e o f

thi s order

. Uniqu e Vacations , Inc. , violate s thi s order' s ceas e an ddesis t provision s o r

fail s t o compl y wit hthi s order' s paymen t provisions , i nwhic hcase . Uniqu e Vacations , Inc. , ma y becom e subjec t t o additiona l enforcemen t actio nfo r violatio no f

th e order

. Payment s shal l b e mad e b y wir e transfe r throug h th e Federa l Reserv e Communication s System , commonl y know n a s "Fe dWire, " t o th e accoun t o f th e U.S

. Treasury

. Th e wir e transfer s shal l b e execute di n accordanc e wit hth e instruction s containe di nth e Attachmen t

t o thi s order ;
6

. Failur e t o pa y th e compromis e assessmen t a s ordere dwil l subjec t Uniqu e Vacations , Inc. , t o th e assessmen t o f interest , penalty , an d collectio n charge s unde r th e Deb t

Collectio nAct , an dpossibl e enforcemen t

actio n fo r

failur e t o compl y wit hthi s order ; an d7

. W e orde r Uniqu e Vacations , Inc. , t o submi t t o th e Offic e o f

Aviatio n Enforcemen t

an dProceeding s copie s o f (a ) al l advertisement s o f ai r tour s o r ai r tou r component s i t

cause s t o b e publishe di nprinte dformat , broadcast s o r

otherwis e circulate s a s curren t durin g th e las t

2 0 day s o f th e eightee n mont hperio dfollowin g th e issuanc e o f thi s order ; an d(b ) printout s o f

scree n display s advertisin g ai r toti r price s o nit s Interne t

sit e fo r th e 15 * da y o f

eac hmont hdurin g th e eightee nmont hperio d followin g issuanc e o f

thi s order

. Thi s materia l shal l b e submitte dwithi n 1 5 day s o f

th e conclusio no f

th e reference deightee nmont hperiod

. Thi s orde r

wil l becom e afina l orde r o f th e Departmen t

1 0 day s afte r

it s servic e unles s atimel y petitio n fo r revie w i s filedo r

th e Departmen t

take s revie w o nit s ow n motion

. BY :

ROSALIN D A

. KNAP P Deput y Genera l Counse l (SEAL )

A n electroni c versio no f thi s documen t

i s availabl e a t wwrw.regulations.go v