The Civilian Board of Contract Appeals (CBCA) is an independent tribunal housed within the General Services Administration. The CBCA presides over various disputes involving Federal executive branch agencies. Its primary responsibility is to resolve contract disputes between government contractors and agencies under the Contract Disputes Act. In addition to contract disputes, the Board also adjudicates cases related to travel and relocation.
The following case relates to a Department of State employee assigned overseas who requested reimbursement of travel expenses for extended economy seating (EES) which was authorized on his orders. The agency denied his request after determining that the circumstances of his travel did not meet the agency’s requirements for reimbursement. The Board granted the claim.
This was a claim from a few years ago, but we were tickled by the 0.3 inches wider economy seat argument. Given what we’re seeing these days, my gosh!
Via CBCA 5686-RELO
Claimant is a foreign service officer currently assigned to Vietnam. On August 15, 2016, claimant and his spouse traveled twenty-three hours from Washington, D.C. to Ho Chi Minh City, Vietnam pursuant to permanent change of station (PCS) orders. Claimant’s orders authorized extended economy seating at the rate of $300 per person. Although the trip was booked on American Airlines,1 the leg from Boston, Massachusetts to Tokyo, Japan was operated by Japan Airlines (JAL). At the ticket counter in Boston, claimant inquired about upgrading his seats to extended economy, consistent with his authorization. The agent confirmed that such seats were available and reassured claimant that the seats were located in economy class. Claimant upgraded his seats for the sum of $600. His request for reimbursement of the cost of extended economy seating was denied.
I understand that you were authorized extended economy seating on your [travel orders], however, per guidance set forth by TTM-A/LM Transportation Branch and the guidance cable you have attached, not all airlines have economy seating available. In addition, TTM informed us that “premium” economy [programs] are not reimbursable as we are not reporting this under the Department’s mandatory annual Premium Class Travel Report. Based on our research on the Japan Airlines website and the seat guru site, Japan Airlines offers “premium” economy with extra services . . . and the seat guru showed that all Japan Airlines aircraft have [a] distinct premium economy cabin.
In response to the denial, Claimant requested a review of the decision, stating:
JAL Extended Economy is still Economy Class seating in [an] economy cabin with additional leg room, and seems to fit within [the] definition . . . My travel was over 14 hours at the allowable cost, and I did not take a rest stop or purchase business lounge [access]. . . The claim reviewer has only stated her reason [for denial] as JAL providing additional entertainment services in extended economy. Nowhere does the [Foreign Affairs Manual] or guidance mention entertainment services as something to preclude use of extended economy seating.
The higher-level review also resulted in a denial of the request for reimbursement of the cost of extended economy seating. Claimant then appealed the denial to this Board. In its response to the appeal, the agency requested that the Board uphold its decision, and explained its determination that JAL’s Premium Economy (PE) seats were in a separate and distinct cabin. “The JAL website includes a seat map of the Boeing 787-9 Series aircraft, which clearly shows separate and distinct rows for PE seating . . . [P]hotos from the JAL website show that Premium Economy is separated from Business Class by dividers and from Economy by the barrier created by the galley and bathrooms.” The agency also points to the written description of PE class to further support its position:
PE seats are 19.2 inches wide (.3 inches wider than economy) and have extendable leg and foot rests. They also provide setbacks in front of passengers and per the JAL website “do not recline backwards, providing even more relaxing and luxurious personal space.” In addition, the JAL website indicates that PE seating offers enhanced benefits not available in the economy cabin. Specifically, the seats have larger entertainment screens, privacy dividers, larger water holders, USB ports, additional video selection, and are located in a designated area of the aircraft. . . . The JAL website also states that the following items are available to travelers seated in PE which are not available to standard economy fliers: additional premium liquors, noise cancelling headphones, a larger amenity pack and access to the JAL Lounge.
The agency does not dispute that claimant met the FAM criteria. (A pre-authorization was obtained and reflected on his PCS orders, the actual cost of the benefit was within the permissible limit of $300 per person, and it was for direct, official travel from his prior duty assignment in Washington, D.C. to his new official duty station in Ho Chi Minh City.) Instead, the agency contends that claimant purchased seats that did not meet the definition of EES. The FAM’s definition of EES refers to “airline programs” that allow passengers to obtain “a more desirable seat choice within the coach class cabin for a fee.” Here, claimant upgraded his seat to an economy class ticket with extra leg room. He did not appear to be in a separate cabin from the other coach seats, and the upgrade fee exactly matched the allowance of $300 per person. The agency disagreed and denied reimbursement after finding that claimant’s seat choices ran afoul of previously published guidance.
Claimant traveled to Vietnam in August 2016. By then, the FAM had already been updated. In denying claimant’s request for reimbursement, the agency did not reference the FAM. Instead, it relied on “guidance set forth by TTM-A/LM Transportation Branch and the guidance cable.” The representative also added that “TTM informed us that ‘premium’ economy [programs] are not reimbursable because we are not reporting this under the Department’s mandatory annual Premium Class Travel Report.” It also referenced a commercial website called “Seat Guru,” as well as the JAL website.
We are left, then, with the provisions of the FAM in deciding whether the agency properly denied claimant’s request for EES. Those provisions simply do not support the agency’s position. The purpose of this program is to provide travelers with additional space in economy class when traveling on long, international flights in support of an agency’s mission. To deny this authorized benefit by stating that the seats in question are .3 inches wider than regular economy seats and have extendable leg and foot rests makes no sense. The agency’s reliance on the “seat guru” website and JAL’s marketing materials further undermines any chance of achieving the objective and universally enforceable standards it seeks for approving or denying reimbursement of this benefit. Reviewing cabin layouts and online brochures requires a subjective analysis that could lead to disparate treatment of similarly situated travelers.
Agencies do not have unfettered discretion once the basic requirements of the regulation are met. Their review must not lead to arbitrary and capricious results. Charles A. Houser, CBCA 2149-RELO, 11-1 BCA ¶ 34,769, at 171,112. In this instance, the agency’s determination is arbitrary and capricious. The seats on JAL were not in first class or business class; they were in economy class. They met the criteria for cost, time/duration, and direct travel. Together, these criteria establish a bright line rule consistent with the FAM. By further complicating the analysis with a subjective determination of “separate and distinct cabins” without any specific guidance on what that means, or by identifying specifically authorized programs with features similar to that which was denied, the agency’s actions cannot be sustained.