Pan American World Airways, Inc., Trans World Airlines, Inc., American Airlines, Inc. v. Civil Aeronautics Board, World Airways, Inc., Intervenors

380 F.2d 770, 1967 U.S. App. LEXIS 5556
CourtCourt of Appeals for the Second Circuit
DecidedJuly 20, 1967
Docket510, 511, Dockets 30947, 30948
StatusPublished
Cited by38 cases

This text of 380 F.2d 770 (Pan American World Airways, Inc., Trans World Airlines, Inc., American Airlines, Inc. v. Civil Aeronautics Board, World Airways, Inc., Intervenors) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pan American World Airways, Inc., Trans World Airlines, Inc., American Airlines, Inc. v. Civil Aeronautics Board, World Airways, Inc., Intervenors, 380 F.2d 770, 1967 U.S. App. LEXIS 5556 (2d Cir. 1967).

Opinion

HAYS, Circuit Judge:

This is a petition to review five orders of the Civil Aeronautics Board awarding certain supplemental air carriers, inter-venors in this action, certificates which authorize them to operate so-called “inclusive tours” 1 between points in the *772 United States and various foreign points. Petitioners’ principal contention is that the Board lacked the power to authorize inclusive tours. The jurisdiction of this court is invoked under Section 1006 of the Federal Aviation Act of 1958, 49 U.S.C. § 1486. We hold that the Board lacked the power to authorize “inclusive tours” and that the challenged provisions should be stricken from the certificates awarded to the intervening carriers.

I.

Petitioners are three air carriers holding certificates of public convenience and necessity issued by the Civil Aeronautics Board under Section 401(d) (1) of the Federal Aviation Act, 49 U.S.C. § 1371 (d) (1), authorizing them to engage in air transportation between the United States and various points abroad. Each of the intervenors, with the exception of the American Society of Travel Agents, Inc., is a supplemental air carrier 2 defined under Section 101(32) of the Act, 49 U.S.C. § 1301(32), as “an air carrier holding a certificate of public convenience and necessity authorizing it to engage in supplemental air transportation.” As the name implies, the services of supplemental air carriers are intended to supplement those of the scheduled carriers. See Section 101(33) of the Act, 49 U.S.C. § 1301(33).

In July 1962, Congress enacted Public Law 87-528, 76 Stat. 143, amending the Federal Aviation Act of 1958. The amendment established a comprehensive system for the certification and regulation of supplemental air carriers. In particular, it empowered the Civil Aeronautics Board to grant certificates of public convenience and necessity authorizing these carriers to engage in “supplemental air transportation.” Section 401(d) (3), 49 U.S.C. § 1371(d) (3). 3 “Supplemental air transportation” was defined as “charter trips in air transportation * * * to supplement the scheduled service” which regular route carriers such as petitioners are authorized to provide. Section 101(33), 49 U.S.C. § 1301(33).

On March 11, 1966 the Board handed down opinions and orders in proceedings known as the Supplemental Air Service Proceeding and the Reopened Transatlantic Charter Investigation.

One of the orders, issued in the Supplemental Air Service Proceeding, Docket No. 13795, approved the certification of certain supplemental air carriers in the domestic area and authorized them to operate inclusive tour charters. CAB Or *773 der No. E-23350 (March 11, 1966). Other orders issued under the same name and docket number, (1) approved the certification of certain supplemental carriers to operate in various overseas and foreign areas 4 and authorized them to operate inclusive tours (CAB Order No. E-24237 (March 11, 1966)), and (2) adopted proposed regulations defining various terms and setting out the scope of the carriers’ inclusive tour authorization (CAB Order No. E-24238 (March 11, 1?66)),

Two other orders were issued the same day under the title Reopened Transatlantic Charter Investigation (All-Expense Tour Phase), Docket No. 11908. Under the first of these orders, the right to operate inclusive tours was added to the certificates previously granted to Capitol Airways and Saturn Airways authorizing them to engage in supplemental air transportation in the transatlantic area. CAB Order No. E-24240 (March 11, 1966). The second order adopted for the authorized transatlantic supplemental carriers the regulations referred to above. CAB Order No. E-24241 (March 11, 1966).

Under the statute the orders concerned with foreign air transportation entered in the Reopened Transatlantic and Supplemental Air Service cases were subject to the President’s approval. See Section 801 of the Act, 49 U.S.C. § 1461. 5 Those are the orders now before us for review. No presidential approval was required for the domestic orders entered in the Supplemental Air Service Proceeding. They immediately became final and subject to judicial review. The petitioners in the instant case were among the parties who sought judicial review of the Board’s domestic orders in the Court of Appeals for the District of Columbia Circuit, contending primarily that the Board exceeded its statutory powers in granting supplemental carriers inclusive tour authority. That court had previously decided the “split charter” 6 case, American Airlines, Inc. v. Civil Aeronautics Board, 121 U.S.App.D.C. 120, 348 F.2d 349 (1965), in which it had said:

“Congress intended, although not without limits, that the Board should *774 be free to evolve a definition [of ‘charter trips,’ 49 U.S.C. § 1301(33)] in relation to such variable factors as changing needs and changing aircraft * * * ” 348 F.2d at 354.

Relying in part on the quoted statement and in part on its own analysis of the relevant legislative history, the court rejected the contention that Congress had not empowered the Board to authorize inclusive tours. American Airlines v. Civil Aeronautics Board, 365 F.2d 939 (D.C.Cir. 1966).

Thereafter, on September 27, 1966, the orders concerning foreign air transportation were approved by the President. Petitioners now seek review of the orders in this court contending that the Board exceeded its statutory powers in granting inclusive tour authority to supplemental air carriers. They also urge that the Board erred in denying them a hearing before it granted inclusive tour authority to the supplemental carriers involved in the Reopened Transatlantic Charter Investigation and that the orders are unlawful under the statute since they were approved by only two members of the five man Board, one member dissenting and two not participating.

In view of our decision that the grant of authority for inclusive tours was beyond the Board's power, we find it unnecessary to reach the other points raised by petitioners.

The Board contests petitioners’ claims on the merits. .

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380 F.2d 770, 1967 U.S. App. LEXIS 5556, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pan-american-world-airways-inc-trans-world-airlines-inc-american-ca2-1967.