Court Opinion

ID: 7838329
Source: CourtListenerOpinion
Date Created: 2022-09-08 16:42:43.19571+00
Date Added: 2024-06-11T15:56:12.020878
License: Public Domain

On Rehearing En Banc.
Before BAZELON, Chief Judge, and WRIGHT, McGOWAN, TAMM, LEVEN-THAL, ROBINSON, MacKINNON, ROBB and WILKEY, Circuit Judges, sitting en banc.
Opinion for the Court filed by Circuit Judge McGOWAN.
*17Concurring opinion filed by Circuit Judge WRIGHT.
Concurring opinion filed by Circuit Judge LEVENTHAL.
Circuit Judges TAMM, MacKINNON, ROBB and WILKEY concur in the Court’s opinion with respect to 73-1718, but would reinstate the division’s judgment and opinion in 73-1714.
McGOWAN, Circuit Judge:
We agreed to rehear these consolidated direct review petitions en banc for the limited purpose of inquiring into the timeliness and propriety of the division’s opinion granting review of the orders in question. 173 U.S.App.D.C. 1, 522 F. 2d 107 (1974). We have confined ourselves, as a full court, to resolving these questions, and have refrained from reexamining the merits of the division’s decision.
In No. 73—1718 review is sought of the orders in which the Board announced the seating configuration policy that it had evolved in Phase 6A of its Domestic Passenger Fare Investigation. Our concern was with whether these orders are ripe for review. Having concluded that they are, we leave the division’s opinion in No. 73-1718 undisturbed, and direct its reinstatement.
No. 73-1714 is an appeal of a Board order suspending a rate filing. Exercises by regulatory bodies of their statutory authority to suspend for limited periods of time and effectiveness of rate filings have not normally been thought to be judicially reviewable at any time, although it is said that an exception should be made here because the Board was abusing its suspension power in aid of its invalid Phase 6A policy. We do not decide that question, however, since we have concluded that, given the invalidation of that policy in No. 73-1718, the panel opinion in No. 73-1714 should remain vacated because the appeal is moot.

No. 73-1718

The background of this appeal, given in some detail in the panel opinion, is reiterated here only as it relates to the question of ripeness. The Board set out in Phase 6A of its Domestic Passenger Fare Investigation “to establish seating configuration standards” for passenger aircraft.1 Its concern was with one aspect of the familiar phenomenon of airline service competition: effectively prevented by the Board from competing in price, the carriers vie for the favor of the travelling public by offering it a variety of extra services and “frills”—more frequent flights, more exotic meals, and, in this instance, more room for its knees and elbows. But such services are expensive. They eat away the reasonable rate of return which it is the function of the regulated fare level to safeguard. When fare increases are ultimately granted to restore that rate of return, the cost of the services ends up where all costs ultimately do—in the lap of the travelling public.
The Board’s specific fear with respect to seating configuration was that competition “would ultimately force a large-scale conversion [from 6-abreast] to 5-abreast service,” and that “this in turn would of necessity result in either increased fares or reduced service to the public.”2 The same was expected to happen with wide-bodied aircraft, which normally seat 10-abreast (in the case of the B-747) or 9-abreast (in the case of the DC—10 and L-1011), but which the airlines might be forced by competition to convert to configurations of 9- or 8-abreast. Also taken up in Phase 6A was the kindred danger that whole sections of seats would be eliminated in favor of passenger “lounges.”
Order 72-5-101 embodies the Board’s final decision in Phase 6A. It, along with the Board’s Order on Reconsideration, is the subject of this appeal. Order 72-5-101 styled itself as neither a “rule” nor a “policy statement.” It simply stated “conclusions” and made “findings.” The major “findings” were that (1) future fares would be calculated on the basis of 6- and 10-abreast seating, (2) the earlier-considered alternative of requir*18ing a surcharge for low density seating would be abandoned, and (3) the threat of “large-scale conversion” to such seating would be averted by permitting fare differentials, in certain circumstances, between high and low density carriers.
As clarified in the Order on Reconsideration, the plan adopted was this: a high density carrier (i. e., one with loungeless and 6 or 10/9-abreast seating) would, upon a showing of “adverse competitive impact” from the operations of a low density carrier, be permitted a fare reduction that was “reasonably related to cost savings.” The low density competitor would not be permitted to match the reduction except on a showing of “special or unusual circumstances.”3 The announcement of this plan is the agency action that petitioners assert is ripe for our review.
The law of ripeness, once a tangle of special rules and legalistic distinctions,4 is now very much a matter of practical common sense. Abbott Laboratories, Inc. v. Gardner, 387 U.S. 136, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967), dominates the field. It teaches that
the ripeness doctrinéis] . . . basic rationale is to prevent the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements over administrative policies, and also to protect the agencies from judicial interference until an administrative decision has been formalized and its effects felt in a concrete way by challenging parties.
The same case prescribes a methodology for deciding whether a particular agency action is ripe for review:
The problem is best seen in a twofold aspect, requiring us to evaluate both the fitness of the issues for judicial decision and the hardship to the parties of withholding court consideration.
Id. at 148-49, 87 S.Ct. at 1515.
The label an agency attaches to its action is not determinative.5 The action may be reviewable even though it is merely an announcement of a rule or policy that the agency has not yet put into effect.6 Indeed, agency action may be reviewable even though it is never to have any formal, legal effect.7 What is *19required is that the interests of the court and agency in postponing review until the question arises in some more concrete and final form, be outweighed by the interest of those who seek relief from the challenged action’s “immediate and practical impact” upon them.8 The former interests are encompassed within the first half of the Abbott Laboratories “twofold aspect” the “fitness of the issues for judicial decision,” while the latter interests are expressed in the second part, the “hardship to the parties of withholding court consideration.” We take them up in the same order.
The interest in postponing review is strong if the agency position whose validity is in issue is not in fact the agency’s final position. If the position is likely to be abandoned or modified before it is actually put into effect, then its review wastes the court’s time and interferes with the process by which the agency is attempting to reach a final decision. It was for this reason that we considered review premature in Pacific Gas & Electric Co. v. FPC, 164 U.S.App.D.C. 371, 506 F.2d 33 (1974). The “Statement of Policy” therein sought to be reviewed set out the Commission’s views on the proper allocation of natural gas supplies during periods of shortage. We concluded that those views were only tentative, however. Suppliers were subsequently to submit for Commission approval specific plans for the curtailment of deliveries of scarce supplies. The “Statement of Policy” proposed an order of end-use priorities that those plans might incorporate. It was issued without notice or opportunity for comment, and its aim was “not to provide for an inflexible, binding rule but to give advance notice of the general policy with respect to curtailment priorities that the Commission prefers.” Id. at 378, 506 F.2d at 40. The Commission expressly foresaw challenges to this policy in connection with its review of individual curtailment plans.
By contrast, there is every indication that the Board considers its position on seating configuration to be final. That position was developed in formal, adjudicatory proceedings that consumed more than two years’ time.9 The last comparable investigation was the “extremely lengthy and complex” General Passenger Fare Investigation of a decade earlier.10 Order 72-5-101 purports in terms to be the Board’s “final decision on the matter.” 11 It follows an earlier “tentative decision” and itself contains no equivocal or tentative language.12 We may take judicial notice of the fact that the policy it establishes of allowing fare differentials for the protection of high density carriers has since been applied by the Board in two concrete instances, and that in one of these instances the Board expressly ruled that the policy was “not subject to review in this proceeding.” 13
*20It is true that Order 72-5-101 contains conditions on the allowance of fare differentials which may not be met in every case. A high density carrier must show that the differential is necessary to redress some degree of adverse competitive impact.14 The differential must be reasonably related to cost savings, and not offset by “special and unusual circumstances.” But these conditions of the Board’s policy do not affect its finality. They are elements—and ostensibly final elements—of the policy itself. They form a part of the question: may the Board allow cost-related fare reductions to meet the competitive threat of low density seating, absent “special and unusual circumstances”? Since we will be confronted by this same question whether we grant review now or later, we conclude that the challenged Board policy is, in the appropriate sense, final.
Of this issue’s fitness for resolution in other respects there can be little doubt. It turns very largely on the “purely legal” question of the proper construction of Section 401(e)(4) of the Federal Aviation Act, 49 U.S.C. § 1371(e)(4) (1970), prohibiting regulation of “accommodations and facilities” by the Board.15 It also requires an understanding of the economics of seating configurations and of the practical consequences of the Board’s fare differential policy. But these are matters relating to airlines and airline regulation generally. We think the panel could competently explore them outside the setting of a concrete application of the policy.
The “hardship to the parties of withholding court consideration” seems substantial in this case. Characteristically, the hardship of delayed review is that it places those who seek it in the following dilemma: in the meantime they must either comply with the agency’s policy, at some expense which they maintain is unnecessary, or they must risk incurring the sanctions for non-compliance should they turn out to be wrong. If this dilemma is sufficiently acute, then the policy has been “felt in a concrete way by the challenging parties.”16
The Board policy in this case is to prevent the spread of low density seating and to encourage its elimination by those who already offer it. The burden of compliance with that policy is obviously substantial. It was estimated by one airline that its cost of conversion from 5-to 6-abreast seating would be $2 million or one third of its annual domestic operating profits.17 The sanction for noncompliance with the Board’s policy is exposure to an adverse fare differential. Of course the sanction is not automatic. Still, the recalcitrant low density carrier can be reasonably sure of incurring it. Some high density competitor is bound *21to seek a fare differential, and it seems more than likely that the Board will approve the differential, at least in part. Once again, we may take judicial notice of the fact that it has done so twice already. And perhaps this is not surprising. The Board’s entire policy is predicated on the “competitive impact” of low density seating, and also on the fact that in the long run high density seating necessarily brings about per-seat cost savings. As for the “special and unusual circumstances” that may protect a low density carrier, all we know is that no such carrier has yet been able to claim them.
A fare differential is a sanction too . punishing to be endured for any significant period of time. That is certainly the lesson of the Board’s first application of its fare differential policy. In January of 1973 it announced that it would permit Trans World Air Lines to reduce its fare for non-lounge service between New York and Los Angeles. The reduction was justified as necessary to make TWA’s loungeless flights competitive with the lounge service of other carriers flying the same route. But the reduction apparently never went into effect. Rather than suffer the effects of a fare differential, the carriers agreed to “mutually acceptable programs for the removal of their wide-bodied lounges,” and the TWA tariff was withdrawn.18
To be sure, an airline’s exposure to a fare differential can be ended at any time by a decision to eliminate low density seating. Thus, an airline which seeks a court test need hold out only as long as it takes to secure judicial review. But judicial review may be a long time in coming. United States v. S.C.R.A.P., 412 U.S. 669, 93 S.Ct. 2405, 37 L.Ed.2d 254 (1973), and Arrow Transportation Co. v. Southern Ry., 372 U.S. 658, 83 S.Ct. 984, 10 L.Ed.2d 52 (1963), holding that rate suspension orders are in general unreviewable, suggest that the fare differential must be endured, if it is to be challenged, for the entire six months’ suspension period. We do not decide whether a fare differential suspension order would be reviewable or not, but merely observe that the possibility of its being unreviewable might well be enough to dissuade the airlines from contesting the Board’s policy at all.19
Even assuming that the courts would, by staying and granting review of the suspension order, afford a realistic chance to challenge the Board’s policy at that later juncture,20 still the delay works a considerable hardship. Aircraft cannot be converted overnight. The ex*22pense of delaying and then having to do so hurriedly might be considerable. In any case definite plans cannot be made. One wonders, for example, how the airlines are to deal with the problem of advance reservations for the flights in question. As was said of the agency action held ripe in United States v. Storer Broadcasting Co., 351 U.S. 192, 199, 76 S.Ct. 763, 769, 100 L.Ed. 1081 (1956), these orders “now operate to control the business affairs” of the airlines.21
We do not pretend that the science of assessing an issue’s ripeness is an exact one. Agency positions are never absolutely final. There is always some danger in accelerating the review process, and always some hardship in delaying it. If the analysis is an imprecise one, however, it may nevertheless yield clear results, as we think it has in this case. Any doubts we might have are resolved by the presumption of reviewability which we have previously said “permeates the Abbott Laboratories ruling.” National Automatic Laundry and Cleaning Council v. Shultz, 143 U.S.App.D.C. 274, 443 F.2d 689, 694 (1971). The presumption stands on firm ground. However much the courts might prefer to resolve a particular question at another time and place, they should have a very good reason for indulging that preference, if in doing so they are refusing a petitioner’s request to be relieved of an onerous legal uncertainty. Our en banc inquiry has disclosed no such reason.

No. 73-1714

We have already recounted the short history of the New York-Los Angeles fare differential, the Board’s first application of its fare differential policy. The second application came several months later in the Chicago-Los Angeles market. United Air Lines and several other carriers filed in April of 1973 for a reduction of ten dollars in the fare charged for non-lounge service between those two cities. Continental Air Lines, a lounge operator, filed a matching reduction. Continental’s tariff was suspended for three months; the others were not.22 No. 73-1714 is the appeal taken from that suspension order.
Like the New York-Los Angeles suspension order, this one has never actually resulted in a fare reduction. Indeed, in the implementation of the Phase 6A policy, a fare reduction appears to be the one thing that in practice will never happen. If a fare differential is genuinely threatened, because the tariff by which the low density carrier seeks to match the high density carrier’s reduction is suspended, then the low density carrier will yield. It will agree to some “mutually acceptable program” for increasing its seating density, and in return the high density carrier will withdraw its fare reduction. If, on the other hand, it becomes clear that a fare differential will not be permitted, because a suspension order is not issued or is judicially stayed, then the high density carrier will yield. It will withdraw its fare reduction and look for some other way to respond to the threat of low density seating—perhaps by offering such seating itself. In either case the fare reductions and the suspension order never actually take effect. They are merely the formal steps by which it is learned whether the Board will decide, and be permitted, to authorize a fare differential.
*23The first of our two scenarios describes what happened in the New YorkLos Angeles market. The second describes what happened in the case of the suspension order now under review. That suspension order, had it not been stayed, would have prevented Continental from matching the fare reductions filed by United and the other non-lounge carriers. It might well have forced Continental to remove its lounges. But Continental succeeded in obtaining, from a motions panel of this court, a stay of the suspension order pending its appeal. The object of their fare reductions having been at least temporarily defeated, the non-lounge carriers withdrew them.23
The Board apparently issued no further suspension orders. It did proceed to investigate the Chicago-Los Angeles fare reductions sought by both Continental and the high density carriers. That investigation ended with an order, issued on October 10, 1974, limiting the high density carriers to a five dollar fare reduction and prohibiting any reduction at all by Continental.24 On October 22, 1974, the Board stayed the effectiveness of that order pending consideration of petitions for reconsideration.25 Such petitions have apparently been filed, but the Board has yet to act on them. Quite possibly it is awaiting the outcome of the present challenge to the Phase 6A policy.
The foregoing is the history of a suspension order which, if it ever had any effect, certainly has none today. It expired by its own terms on August 29, 1973.26 Whether the Board could now issue a new suspension, its power to do so having been extended beyond the normal six month period by this court’s stay of the former suspension, is a question we need not reach. The appeal is moot if no suspension is now in effect, and all parties, including the Board, agree that none is.27
Nor is there a strong argument for our regarding this appeal as only “technically moot” and proceeding to decide it nonetheless because it involves a recurrent question which would otherwise escape judicial review. See Southern Pacific Terminal Co. v. ICC, 219 U.S. 498, 515, 31 S.Ct. 279, 55 L.Ed. 310 (1911). The question we would be deciding has to do not with the Board’s substantive policy, which the panel has already invalidated, but with the reviewability of its suspension orders. That question may conceivably recur, but not in the same form as it is presented here.
The issue, in brief, is whether the particular suspension order falls within the holding of the S.C.R.A.P. and Arrow cases that such orders are generally unreviewable, or within the exception stated in Moss v. CAB, 139 U.S.App.D.C. 150, 430 F.2d 891 (1970), for “sham” suspensions aimed at coercing behavior rather than merely preserving the status quo pending investigation. How this issue is resolved greatly depends on the circumstances of the particular suspension order. The circumstances of this one will not recur. We may assume that the Board will issue no further suspension orders implementing its invalid seating configuration policy. Other suspension orders, having different justifications and different practical effects, will pose different questions of reviewability. It would be of little help in resolving those questions if we were to reach out to decide this one. The policy that underlay this suspension order has not escaped review, and the question of reviewability that it presents is one which we see no good reason to decide.
The decision and opinion of the division in No. 73-1718 are directed to be *24reinstated; and the petition for review in No. 73-1714 is dismissed.

It is so ordered.

. Order 72-2-121, J.A. 52.

. Order 72-5-101, J.A. 261.

. Order 72-5-101, J.A. 293-94; J.A. 343-49. The Orders are not models of clarity. 72-5-101 separately discusses the three kinds of high density carrier, 6-abreast, 10/9-abreast, and loungeless. It mentions the “special and unusual consequences” exception in connection with all three. It mentions the “adverse competitive impact” requirement only in connection with 6-abreast and loungeless carriers, however, and it mentions the “related to cost savings” requirement only in connection with 10/9-abreast carriers. J.A. 294. Order 73-6-102 makes clear that all conditions apply to fare reductions in all three cases, but introduces the new principle that fare differentials must be “based upon cost of service and value of service considerations.” J.A. 346 (emphasis added).

. See Chicago & S. Air Lines, Inc. v. Waterman Steamship Corp., 333 U.S. 103, 112-13, 68 S.Ct. 431, 437, 92 L.Ed. 568 (1948) (administrative orders reviewable only when they “impose an obligation, deny a right or fix some legal relationship”); United States v. Los Angeles & S.L.R.R., 273 U.S. 299, 309-10, 47 S.Ct. 413, 414, 71 L.Ed. 651 (1927) (administrative order not reviewable if it does not “command the carrier to do, or refrain from doing, anything; . . grant or withhold any authority, privilege or license; . . . extend or abridge any power or facility; . , . subject the carrier to any liability, civil or criminal; . . change the carrier’s existing or future status or condition; . . . [or] determine any right or obligation”).

. See Columbia Broadcasting System v. United States, 316 U.S. 407, 416, 62 S.Ct. 1194, 86 L.Ed. 1563 (1942); Sea-Land Service, Inc. v. Federal Maritime Comm’n, 131 U.S.App.D.C. 80, 402 F.2d 631, 633 (1968) (“[W]hat is decisive is the substance of what is done.”).

. A striking case is Flemming v. Florida Exchange, 358 U.S. 153, 167-68, 79 S.Ct. 160, 3 L.Ed.2d 188 (1958), in which immediate review was granted of an FDA regulation banning the use of certain artificial coloring agents for oranges, even though the regulation was not to take effect until three years after its promulgation.

. In Bantam Books, Inc. v. Sullivan, 372 U.S. 58-66-69, 83 S.Ct. 631, 638, 9 L.Ed.2d 584 (1963), review was granted of a state agency’s informal exhortations to book and magazine distributors not to sell certain publications deemed by the agency to be “objectionable for *19sale ... to youths.” The state agency had no legal power to inhibit the sale of the publications (it could only recommend that the Attorney General prosecute), yet the Court “look[ed] through forms to the substance” of the matter, which was that an “informal censorship” was being imposed.

. Frozen Foods Express v. United States, 351 U.S. 40, 44, 76 S.Ct. 569, 100 L.Ed. 910 (1956).

. Six of the nine phases of the DPFI, including Phase 6A, were conducted in adjudicatory rather than rule-making proceedings. Order 70-2-121, J.A. 49. The DPFI was instituted in January of 1970. Order 70-1-147, J.A. 33. The final order in Phase 6A was issued on May 26, 1972. Order 72-5-101, J.A. 252. The Order on Reconsideration was issued on June 26, 1973. Order 73-6-102, J.A. 333.

. Order 7-1-147, J.A. 70.

. J.A. 256.

. A sample of the Board’s language is the following:
Any carrier operating a 6-abreast in markets competitive with narrow-bodied 5-abreast aircraft . . . may lower its fare to a level necessary to meet such competition, and the operator of the less dense configuration will be permitted to match the lower fares only on a showing of special or unusual circumstances.
J.A. 297.

. Order 74-10-27 at 3 (filed October 10, 1974). This was the Board’s final order following its investigation of the Chicago-Los Angeles rates whose suspension is sought to be reviewed in Nos. 73-1714. See, infra, 173 U.S. *20App.D.C. pp. 22-23, 522 F.2d pp. 128-129. The other concrete application of the policy occurred in the New York-Los Angeles market. See, infra, 173 U.S.App.D.C. p. 21, 522 F.2d p. 127.

. Order 72-5-101 requires a showing of a “risk of adverse competitive impact.” On reconsideration the Board stiffened this requirement for 6- and 10/9-abreast carriers, whom it will permit to lower their fares only on a showing of “actual harm.” Order 73-6-102, J.A. 348. The requirement remains the same for non-lounge carriers, but it was relaxed in the case of carriers who offer lounge service and would like to eliminate it. The latter may lower their fares if “the risk of adverse competitive impact would otherwise inhibit such conversion.” Id. at 360-61.

. See Abbott Laboratories, Inc. v. Gardner, 387 U.S. 136, 149, 87 S.Ct. 1507, 1515, 18 L.Ed.2d 681 (1967) (issue was fit for resolution in part because it was “a purely legal one: whether the statute was properly construed by the Commissioner”). Accord National Automatic Laundry and Cleaning Council v. Shultz, 143 U.S.App.D.C. 274, 443 F.2d 689, 695 (1971).

. Abbott Laboratories, Inc. v. Gardner, 387 U.S. 136, 152-53, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967). See also K. C. Davis. Administrative Law Treatise 674 (Supp.1970) (endorsing the “basic proposition that administrative action which creates a dilemma for a private party who must choose between disadvantageous compliance and risking serious penalties is ripe for challenge”).

. Order 71-4-48, J.A. 96.

. See Orders 73-1-69 and 73-6-4, J.A. 316, 321, 323. The New York-Los Angeles experience seems to provide a complete answer to what is perhaps the most compelling argument for postponing review, namely, that the validity of fare differentials turns on the degree to which they can be justified by cost savings, and that this cannot be known until the Board grants a particular differential on the basis of a particular cost justification. But it is clear that the invalidity of the Phase 6A policy does not depend on any assumption as to the relationship of fare differentials to costs. The problem is that the policy is likely never to lead to any differential, cost-justified or otherwise, but simply to the elimination of low density seating without any fare change at all.

. It appears that the Board almost achieved this objective, at least with respect to the lounges. The “mutually acceptable” programs for lounge removal which resulted from the threatened New York-Los Angeles differential apparently were entered into by all or most of the carriers. The matter might never have come up again had not Continental Air Lines decided that its low load factors prevented it from going along. The fare reduction sought in the Chicago-Los Angeles market was in a sense a device to bring Continental into line. The carriers seeking the reduction argued to the Board that Continental’s decision “threaten[ed] their ability to continue the lounge removal program.” See generally Order 73-6-4, J.A. 321, 323.

.Such a stay and grant of review were, of course, obtained by Continental in No. 73-1714. Suffice it to say that Continental’s success in this respect could scarcely have been confidently predicted in light of the S.C.R.A.P. and Arrow holdings.

. See also Frozen Food Express v. United States, 351 U.S. 40, 44, 76 S.Ct. 569, 571, 100 L.Ed. 910 (1956) (declaratory order that certain motor carriers were within ICC jurisdiction was ripe because it “sets the standard for shaping the manner in which an important segment of the trucking business will be done”); Columbia Broadcasting System v. United States, 316 U.S. 407, 62 S.Ct. 1194, 86 L.Ed. 1563 (1942) (FCC’s announcement that it would not relicense broadcasters entering certain kinds of contracts held ripe in part because it might cause “wholesale cancellation” of such contracts); Textile and Apparel Group v. FTC, 133 U.S.App.D.C. 353, 410 F.2d 1052, 1054, cert. denied, 396 U.S. 910, 90 S.Ct. 223, 24 L.Ed.2d 185 (1969) (FTC rule regarding inspection of imported wool held ripe before enforcement in part because it would “wreak havoc” with delivery schedules).

. Order 73-6-7, J.A. 321.

. Br. Intervenors United Airlines and Delta Airlines at 3.

. Order 74-10-27.

. Order 74-10-114.

. Order 73-6-4, J.A. 325.

. See, e. g., Respondent’s Supplemental Memorandum on Rehearing En Banc, at 27.