Continental Airlines, Inc. v. Intra Brokers, Inc.

24 F.3d 1099 (9th Cir. 1994)

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Nature of the Case

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Facts

P published discount coupons in 1991 and 1992. They were redeemable with Continental for various discounts. All the coupons had language printed on the back restricting transfer, saying they 'cannot be bartered, sold or redeemed for cash.' D acquired the coupons and sold them to travel agents, for resale to their customers. D's advertisements to the trade promoted the coupons as a way that travel agencies could sell airplane tickets for less than competing agencies, by buying P coupons from D and selling them to their customers. P noticed D it would enforce its rule against transfer of the coupons with the 1992 coupon book. P's attorney wrote D, again demanding that Intra stop selling the coupons, and threatening 'to take whatever steps are necessary' if they did not. D responded through its attorney that the restrictions on transfer were invalid, and refused to assure P that it would cease selling the coupons. P sued for damages, declaratory relief, and an injunction. As the facts stand in the record, P wrote on the coupons and stated in a letter that they could not be sold, but assured D repeatedly that the condition would not be enforced, until April of 1992 shortly before it filed suit. P thought it benefited financially from D's sales of the coupons in 1991 and 1992. Then in April of 1992, P changed its position and plainly advised D of the change. There was no evidence of harm or benefit to P on account of D's refusal to comply. The district court dismissed D's counterclaims for fraud, negligent misrepresentation, and interference with prospective economic advantage on the basis of federal preemption, without prejudice to refiling claims in the Department of Transportation. It granted summary judgment to P on its claims for injunctive and declaratory relief. The permanent injunction commands D not to sell P coupons. This interlocutory appeal resulted.