## Facts

- Continental Airlines distributed discount coupon books in 1991–1992 that provided airfare discounts.
- Each coupon stated it “cannot be bartered, sold or redeemed for cash,” restricting transfer and resale.
- Intra Brokers acquired Continental coupons and sold them to travel agents for resale or use by customers.
- Continental historically did not enforce the transfer restriction against brokers.
- Continental sent Intra a written notice (Aug. 20, 1991) stating it would begin enforcing the restriction with the 1992 coupon book.
- Intra claimed Continental personnel later made oral statements minimizing the notice and indicating approval of Intra’s coupon sales, and Intra continued reselling coupons.
- Continental sued for injunctive relief to stop Intra’s resale of the coupons; the district court entered a permanent injunction.

## Issues

1. Whether Continental could enforce the coupons’ express anti-transfer language and obtain an injunction after previously tolerating resale.
2. Whether Continental’s prior nonenforcement and alleged oral assurances created waiver or estoppel barring injunctive relief.

## Decision

- The Ninth Circuit affirmed the permanent injunction against Intra.
- The court held the coupons’ printed anti-transfer restriction was enforceable.
- Prior tolerance of resale did not permanently prevent enforcement where Continental gave clear written notice of a change in enforcement policy.
- Intra’s waiver and estoppel defenses did not defeat enforcement in light of the explicit written restriction and Continental’s written notice.
- Injunctive relief was appropriate to stop ongoing violations and to protect Continental’s control over its promotional program.

## Legal Principles

- Express, written transfer restrictions in promotional instruments may be enforced according to their terms.
- A party’s past nonenforcement or acquiescence generally does not make a contractual right permanently unenforceable; enforcement may resume after clear notice.
- Waiver based on course of conduct is not necessarily irrevocable, particularly when the right is plainly stated in writing and the enforcing party communicates a change in practice.
- Estoppel based on alleged oral statements is limited where written terms and written notice provide contrary, unambiguous direction.
- A permanent injunction may issue where violations are ongoing and damages are inadequate to protect the plaintiff’s interests.

## Conclusion

The Ninth Circuit upheld an injunction barring a broker’s resale of airline discount coupons, holding that the airline could enforce clear anti-transfer terms despite prior nonenforcement once it provided written notice of renewed enforcement, and that waiver or estoppel did not bar equitable relief.


Continental Airlines, Inc. v. Intra Brokers, Inc., 24 F.3d 1099 (9th Cir. 1994)