Donald Wortman v. All Nippon Airways

854 F.3d 606, 2017 WL 1363805
CourtCourt of Appeals for the Ninth Circuit
DecidedApril 14, 2017
Docket15-15362, 15-15364
StatusPublished
Cited by4 cases

This text of 854 F.3d 606 (Donald Wortman v. All Nippon Airways) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Donald Wortman v. All Nippon Airways, 854 F.3d 606, 2017 WL 1363805 (9th Cir. 2017).

Opinions

Partial Concurrence and Partial Dissent by Judge Wallace

OPINION

M. SMITH, Circuit Judge:

Defendants-Appellants All Nippon Airways (ANA), China Airlines, and EVA Airways (collectively, Defendants) challenge the district court’s holding that the filed rate doctrine does not preclude Plaintiffs-Appellees’ putative class action suit for antitrust damages based on allegations of collusion and price fixing. We have not previously addressed the application of the filed rate doctrine to airline fares and fees. For the reasons set forth in this opinion, we hold that, based on the record in this case, the filed rate doctrine does not preclude Plaintiffs’ suit for antitrust damages challenging Defendants’ unfiled fares, fuel surcharges, or “discount” fares. We therefore affirm the district court’s partial denial of Defendants’ motions for summary judgment.

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiffs claim antitrust violations by Defendants in connection with three categories of Defendants’ charged rates: (1) unfiled fares, (2) fuel surcharges, and (3) special “discount” fares.

[609]*609The DOT’s present regulations require airlines to file their base-fare rates to differing extents, depending upon whether a particular airline is included within Country Category A, B, or ■ C. Airlines headquartered in or traveling between the United States and a Category A country need not file any fares. Airlines headquartered in or traveling between the United States and a Category C country must file all fares. Finally, airlines headquartered in or traveling between the United States and a Category B country must file certain, but not all, of their fares. Those fares not required to be filed are the “unfiled fares” at issue in this appeal.

In addition to charging base-fare rates, some airlines impose fuel surcharges, which are additional per-ticket fees based on the carrier’s fuel costs. Prior to 2004, the DOT did not permit separate fuel surcharges. Rather, airlines were required to incorporate the cost of fuel into the base ticket price. However, in October 2004, the DOT lifted its prohibition on separate fuel surcharges. The parties dispute whether the DOT required filing of these newly allowed surcharges. Defendants argue that it did, citing a 1999 DOT statement that “all surcharges are to be filed,” while Plaintiffs argue that the DOT’s 1999 statement has no relevance to fuel surcharges given that the DOT did not permit fuel surcharges at the time the statement was made. In any event, the record reflects that regardless of whether the DOT required airlines to file fuel surcharges, in many cases airlines did file them.

Finally, Defendant ANA offers a number of special “discount” fares. These include the “Satogaeri” fares and the “Business Discount,” “Biziwari,” or “Buz-Wari” fares, all of which operate in the same manner: Specifically, ANA files the respective fares with the DOT, then authorizes certain travel agents to sell tickets with more restrictive terms to consumers for some amount less than the filed rate. This lesser amount constitutes the “net fare,” which travel agents remit to ANA as payment for the ticket. The travel agent retains as a commission any difference between the net fare and the amount charged to the consumer.

The terms governing the fares actually filed by ANA differed substantially from the terms governing the discount fares. For instance, while one of ANA’s publicly-filed fares could be used for “circle trips”1 and “double open jaw trips,”2 the discounted version of that fare could not. The same public fare had a minimum stay of three days and allowed for a stopover in Japan and up to six transfers, while the discounted fare had no minimum stay, and did not allow stopovers or transfers. Some other of ANA’s filed fares similarly differed from their discounted versions in regard to the types of trips permitted, maximum stay required, the amount of time in advance the ticket needed to be purchased, restrictions on stopovers, and applicable cancellation fees.

Plaintiff Donald Wortman filed a putative class action against Defendants on November 6, 2007, alleging that Defendants (as well as other airlines no longer in the suit) colluded to fix the prices of certain passenger tickets and fuel surcharges on flights between the United States and Asia, in violation of Section 1 of the Sherman Antitrust Act, 15 U.S.C. § 1. On No[610]*610vember 23, 2009, Defendants filed motions to dismiss Plaintiffs’ complaint, in part on the ground that the filed rate doctrine barred Plaintiffs’ claims. The district court granted Defendants’ motions in part on May 9, 2011, but denied their motions in regard to their assertion of the filed rate doctrine as a defense against claims for antitrust damages.

On September 10, 2013, following over two years of discovery, Defendants moved for summary judgment, again on the basis of the filed rate doctrine. On September 23, 2014, the district court granted in part and denied in part Defendants’ respective motions for summary judgment. The district court held that while the filed rate doctrine applied to bar Plaintiffs’ antitrust damages claims based on actually-filed fares, the doctrine did not preclude Plaintiffs’ claims regarding unfiled fares, fuel surcharges, or ANA’s “discount” fares.3 The district court then granted Defendants’ respective motions to certify its order partially denying summary judgment for interlocutory appeal. We similarly granted Defendants’ petitions for permission to appeal. See 28 U.S.C. § 1292(b).

ANALYSIS

I. The History and Application of the Filed Rate Doctrine

The filed rate doctrine is a judicially created rule that prohibits individuals from asserting civil antitrust challenges to an entity’s agency-approved rates. The doctrine originated in Keogh v. Chicago & Northwest Railway Co., 260 U.S. 156, 43 S.Ct. 47, 67 L.Ed. 183 (1922). The plaintiffs in that case sought damages under the Sherman Act, alleging that the rates charged by common carriers exceeded those that would be charged in a competitive market. Id. at 159-160, 43 S.Ct. 47. The rates in question, however, had been filed with, and approved by, the Interstate Commerce Commission (ICC). Id. at 160, 43 S.Ct. 47. The Supreme Court held that the plaintiffs’ suit was precluded, explaining that that

[ijnjury implies violation of a legal right. The legal rights of shipper as against carrier in respect to a rate are measured by the published tariff. Unless and until suspended or set aside, this rate is made, for all purposes, the legal rate.... The rights as defined by the tariff cannot be varied or enlarged by either contract or tort of the carrier.

Id. at 163, 43 S.Ct. 47. The Supreme Court stated that the “paramount purpose” of this rule was to prevent “unjust discrimination” between consumers. Id.

The Supreme Court reaffirmed its Keogh holding six decades later, in Square D Co. v. Niagara Frontier Tariff Bureau, Inc.,

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Bluebook (online)
854 F.3d 606, 2017 WL 1363805, Counsel Stack Legal Research, https://law.counselstack.com/opinion/donald-wortman-v-all-nippon-airways-ca9-2017.