Professional Documents
Culture Documents
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NO. 3:15-CV-03348-M
Count One of the complaint fails because Plaintiffs do not have a viable cause of
action under the federal common law and because Congress did not create a private right of
action under 49 U.S.C. 41310(a).
2)
Count Two of the complaint fails because Plaintiffs claim for tortious
interference with business relations is a claim under state common law that relates to an air
carriers services and thus is preempted by the Airline Deregulation Act of 1978.
3)
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Count Three of the complaint fails because Congress did not create a private right
of action under 49 U.S.C. 44711(a)(4) and because Delta holds a certificate of public
convenience and necessity authorizing it to operate between Atlanta, Georgia, and Johannesburg,
South Africa, which forecloses Plaintiffs claim under 49 U.S.C. 41101(a)(1).
For all of the reasons stated in the accompanying brief, Delta respectfully asks the Court
to dismiss the complaint with prejudice.
Respectfully submitted,
/s/ Russ Falconer________________
Russell H. Falconer
SBN 24069695
GIBSON, DUNN & CRUTCHER LLP
2100 McKinney Avenue, Suite 1100
Dallas, Texas 75201-6911
Telephone: (214) 698-3170
Facsimile: (214) 571-2958
rfalconer@gibsondunn.com
ATTORNEY FOR DELTA AIR LINES, INC.
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CERTIFICATE OF SERVICE
I hereby certify that on December 21, 2015, a true and correct copy of the foregoing
document was served via the CM/ECF system upon all counsel of record.
/s/ Russ Falconer
Russell H. Falconer
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NO. 3:15-CV-03348-M
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TABLE OF CONTENTS
Page
INTRODUCTION ................................................................................................................................ 1
BACKGROUND .................................................................................................................................. 1
ARGUMENT ...................................................................................................................................... 4
I.
Deltas policy of refusing to carry trophy kills as cargo does not violate
any common-law duty............................................................................................. 4
II.
III.
IV.
B.
2.
CONCLUSION.................................................................................................................................. 25
Page 3 of 36 PageID 54
TABLE OF AUTHORITIES
Page(s)
Cases
A.I.B. Express, Inc. v. FedEx Corp.,
358 F. Supp. 2d 239 (S.D.N.Y. 2004)......................................................................................11
Ackerson v. Bean Dredging LLC,
589 F.3d 196 (5th Cir. 2009) ...................................................................................................25
ACORN v. Fowler,
178 F.3d 350 (5th Cir. 1999) .....................................................................................................3
Adkins v. Slater,
298 S.E.2d 236 (W. Va. 1982) ...................................................................................................7
Air Transp. Assn of Am., Inc. v. Cuomo,
520 F.3d 218 (2d Cir. 2008).....................................................................................................12
Akron, Canton & Youngstown R.R. Co. v. I.C.C.,
611 F.2d 1162 (6th Cir. 1979) ...................................................................................................7
Alaska Airlines, Inc. v. Carey,
No. 3:07-cv-5711, 2008 WL 2725796 (W.D. Wash. July 11, 2008),
affd, 395 F. Appx 476 (9th Cir. 2010)...................................................................................11
Alexander v. Sandoval,
532 U.S. 275 (2001) .......................................................................15, 16, 17, 18, 19, 21, 23, 24
Lopez v. Jet Blue Airways,
662 F.3d 593 (2d Cir. 2011).....................................................................................................16
Allandale Neighborhood Assn v. Austin Transp. Study Policy Advisory Comm.,
840 F.2d 258 (5th Cir. 1988) ...................................................................................................16
Am. Airlines, Inc. v. Dept of Transp.,
202 F.3d 788 (5th Cir. 2000) .....................................................................................................9
Am. Airlines, Inc. v. Wolens,
513 U.S. 219 (1995) .................................................................................................................10
Am. Trucking Assns v. Atchison, T. & S. F. Ry. Co.,
387 U.S. 397 (1967) ...................................................................................................................8
Arif Naqvi v. Turkish Airlines, Inc.,
80 F. Supp. 3d 234 (D.D.C. 2015) ...........................................................................................23
Ariz. Christian Sch. Tuition Org. v. Winn,
536 U.S. 125 (2011) ...................................................................................................................3
Ashcroft v. Iqbal,
556 U.S. 662 (2009) ...................................................................................................................4
Page 4 of 36 PageID 55
TABLE OF AUTHORITIES
(continued)
Page(s)
B.J. Alan Co. v. I.C.C.,
897 F.2d 561 (D.C. Cir. 1990) ...................................................................................................6
Bell Atl. Corp. v. Twombly,
550 U.S. 544 (2007) ...................................................................................................................4
Bennett v. Spear,
520 U.S. 154 (1997) ...................................................................................................................3
Bonano v. E. Caribbean Airline Corp.,
365 F.3d 81 (1st Cir. 2004) ..........................................................................................17, 19, 24
Brown v. United Airlines, Inc.,
720 F.3d 60 (1st Cir. 2013) ......................................................................................................10
California v. Sierra Club,
451 U.S. 287 (1981) .....................................................................................................16, 18, 19
Cannon v. Univ. of Chi.,
441 U.S. 677 (1979) .................................................................................................................18
Casas v. Am. Airlines, Inc.,
304 F.3d 517 (5th Cir. 2002) .................................................................................14, 15, 19, 22
City of Burbank v. Lockheed Air Terminal Inc.,
411 U.S. 624 (1973) .................................................................................................................24
Contl Airlines, Inc. v. Am. Airlines, Inc.,
824 F. Supp. 689 (S.D. Tex. 1993) ..........................................................................................11
Contl Airlines, Inc. v. United Air Lines, Inc.,
120 F. Supp. 2d 556 (E.D. Va. 2000) ......................................................................................11
Corr. Servs. Corp. v. Malesko,
534 U.S. 61 (2001) ...................................................................................................................17
Cort v. Ash,
422 U.S. 66 (1976) ...........................................................................................15, 16, 17, 18, 19
De La Paz v. Coy,
786 F.3d 367 (5th Cir. 2015) ...................................................................................................23
Delta Air Lines, Inc. v. Civil Aeronautics Bd.,
543 F.2d 247 (D.C. Cir. 1976) ...................................................................................................7
Diefenthal v. Civil Aeronautics Bd.,
681 F.2d 1039 (5th Cir. 1982) ...........................................................................................22, 23
DiFiore v. Am. Airlines, Inc.,
646 F.3d 81 (1st Cir. 2011) ......................................................................................................25
Elnajjar v. Nw. Airlines, Inc.,
No. 4:04-cv-680, 2005 WL 1949545 (S.D. Tex. Aug. 15, 2005) ............................................23
iii
Page 5 of 36 PageID 56
TABLE OF AUTHORITIES
(continued)
Page(s)
Freeman v. Fahey,
374 F.3d 663 (8th Cir. 2004) ...................................................................................................21
Frontier Airlines, Inc. v. United Air Lines, Inc.,
758 F. Supp. 1399 (D. Colo. 1989) ..........................................................................................11
Gallentine v. Hous. Auth. of City of Port Arthur, Tex.,
919 F. Supp. 2d 787 (E.D. Tex. 2013) .....................................................................................25
Gibbs v. Am. Airlines, Inc.,
191 F. Supp. 2d 144 (D.D.C.2002) ..........................................................................................23
Gonzaga Univ. v. Doe,
536 U.S. 273 (2002) ...........................................................................................................16, 18
Hodges v. Delta Air Lines, Inc.,
44 F.3d 334 (5th Cir. 1995) ...........................................................................................9, 10, 11
Illinois Corp. Travel, Inc. v. Am. Airlines, Inc.,
889 F.2d 751 (7th Cir. 1989) ...................................................................................................10
Intl Truck & Engine Corp. v. Bray,
372 F.3d 717 (5th Cir. 2004) ...................................................................................................23
J.I. Case Co. v. Borak,
377 U.S. 426 (1964) .................................................................................................................15
Kan. State Bank & Trust Co. v. Emery Air Freight Corp.,
656 F. Supp. 200 (D. Kan. 1987) ...............................................................................................8
La. Landmarks Socy, Inc. v. City of New Orleans,
85 F.3d 1119 (5th Cir.1996) ....................................................................................................16
Landry v. All Am. Assur. Co.,
688 F.2d 381 (5th Cir. 1982) ...................................................................................................15
Logan v. U.S. Bank Natl Assn,
722 F.3d 1163 (9th Cir. 2013) .................................................................................................18
Lone Star Fund V (U.S.), L.P. v. Barclays Bank PLC,
594 F.3d 383 (5th Cir. 2010) .....................................................................................................2
Love v. Delta Air Lines,
310 F.3d 1347 (11th Cir. 2002) .........................................................................................17, 21
Lujan v. Defenders of Wildlife,
504 U.S. 555 (1996) ...................................................................................................................3
Lundeen v. Mineta,
291 F.3d 300 (5th Cir. 2002) ...................................................................................................17
Lyn-Lea Travel Corp. v. Am. Airlines, Inc.,
283 F.3d 282 (5th Cir. 2002) ...............................................................................................9, 10
iv
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TABLE OF AUTHORITIES
(continued)
Page(s)
Mass. Mut. Life Ins. Co. v. Russell,
473 U.S. 134 (1985) ...........................................................................................................21, 22
McCasland v. City of Castroville,
514 F. Appx 446 (5th Cir. 2013) ............................................................................................24
Middlesex Cnty. Sewerage Auth. v. Natl Sea Clammers Assn,
453 U.S. 1 (1981) .....................................................................................................................20
Mo. Pac. R. Co. v. Larabee Flour Mills Co.,
211 U.S. 612 (1909) ...............................................................................................................7, 8
Monarch Travel Servs., Inc. v. Assocd Cultural Clubs, Inc.,
466 F.2d 552 (9th Cir. 1972) ...................................................................................................14
Moor v. Tex. & N.O.R. Co.,
75 F.2d 386 (5th Cir. 1935) .......................................................................................................7
Morales v. Trans World Airlines,
504 U.S. 374 (1992) ...........................................................................................................10, 12
Musson Theatrical, Inc. v. Fed. Exp. Corp.,
89 F.3d 1244 (6th Cir. 1996) .....................................................................................................6
N.Y. Tel. Co. v. N.Y. Dept of Labor,
440 U.S. 519 (1979) .................................................................................................................25
Natl Assn of Regulatory Util. Commrs v. F.C.C.,
525 F.2d 630 (D.C. Cir. 1976) ...................................................................................................5
Northwest, Inc. v. Ginsberg,
134 S. Ct. 1422 (2014) .............................................................................................................10
Nw. Airlines, Inc. v. Transp. Workers Union of Am.,
451 U.S. 77 (1981) ...................................................................................................................22
Onoh v. Nw. Airlines, Inc.,
613 F.3d 596 (5th Cir. 2010) ...................................................................................................10
Overka v. Am. Airlines, Inc.,
790 F.3d 36 (1st Cir.), cert. denied, 136 S. Ct. 372 (2015) .....................................................10
Peninsula Airport Commission v. National Airlines, Inc.,
436 F. Supp. 850 (E.D. Va. 1977) ...........................................................................................14
Rowe v. N.H. Motor Transp. Assn,
552 U.S. 364 (2008) ...........................................................................................................12, 24
Sam L. Majors Jewelers v. ABX, Inc.,
117 F.3d 922 (5th Cir. 1997) .....................................................................................6, 9, 15, 17
Smith v. Piedmont Aviation,
567 F.2d 290 (5th Cir. 1978) ...................................................................................................23
Page 7 of 36 PageID 58
TABLE OF AUTHORITIES
(continued)
Page(s)
Spinner v. Verbridge,
125 F. Supp. 2d 45 (E.D.N.Y. 2000) .......................................................................................23
Statland v. Am. Airlines, Inc.,
998 F.2d 539 (7th Cir. 1993) ...................................................................................................17
Thomas v. Tex. Dept of Crim. Justice,
297 F.3d 361 (5th Cir. 2002) ...................................................................................................23
Till v. Unifirst Fed. Sav. & Loan Assn,
653 F.2d 152 (5th Cir. Unit A Aug. 1981)...............................................................................22
Tobin v. Fed. Exp. Corp.,
775 F.3d 448 (1st Cir. 2014) ....................................................................................................25
Touche Ross & Co. v. Redington,
442 U.S. 560 (1979) .....................................................................................................15, 19, 22
Transamerica Mortgage Advisors, Inc. (TAMA) v. Lewis,
444 U.S. 11 (1979) .............................................................................................................19, 22
Treiber & Straub, Inc. v. U.P.S., Inc.,
474 F.3d 379 (7th Cir. 2007) .................................................................................................7, 8
Trujillo v. Am. Airlines, Inc.,
938 F. Supp. 392 (N.D. Tex. 1995), affd, 98 F.3d 1338 (5th Cir. 1996) ................................11
United Airlines, Inc. v. Mesa Airlines, Inc.,
219 F.3d 605 (7th Cir. 2000) ...................................................................................................10
United States v. Dunifer,
219 F.3d 1004 (9th Cir. 2000) .................................................................................................25
United States v. Mitchell,
271 U.S. 9 (1926) .....................................................................................................................23
Varela v. Gonzales,
773 F.3d 704 (5th Cir. 2014) ...................................................................................................25
Virgin Atl. Airways Ltd. v. British Airways PLC,
872 F. Supp. 52 (S.D.N.Y. 1994).............................................................................................11
Webster v. Fall,
266 U.S. 507 (1925) .................................................................................................................23
Williams v. Midwest Express Airlines, Inc.,
315 F. Supp. 2d 975 (E.D. Wis. 2004).....................................................................................23
Wine & Spirits Wholesalers of Mass., Inc. v. Net Contents, Inc.,
10 F. Supp. 2d 84 (D. Mass. 1998) ..........................................................................................11
Woolsey v. N.T.S.B.,
993 F.2d 516 (5th Cir. 1993) .....................................................................................................5
vi
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TABLE OF AUTHORITIES
(continued)
Page(s)
York Co. v. Cent. R.R.,
70 U.S. (3 Wall.) 107 (1865) .....................................................................................................7
Statutes
49 U.S.C. 1374(b) .......................................................................................................................23
49 U.S.C. 40101(a)(12)(B) ...........................................................................................................4
49 U.S.C. 40120(c) .......................................................................................................................6
49 U.S.C. 41101(a)(1)...........................................................................................2, 13, 14, 15, 22
49 U.S.C. 41102 ..........................................................................................................................13
49 U.S.C. 41102(a)(1).................................................................................................................13
49 U.S.C. 41310 ....................................................................................................................20, 22
49 U.S.C. 41310(a) ...........................................................2, 12, 13, 15, 18, 19, 20, 21, 23, 24, 25
49 U.S.C. 41705(a) .....................................................................................................................24
49 U.S.C. 41713(b)(1) ....................................................................................................10, 11, 12
49 U.S.C. 44702 ..........................................................................................................................13
49 U.S.C. 44705 ..........................................................................................................................13
49 U.S.C. 44711 ....................................................................................................................20, 22
49 U.S.C. 44711(a) .....................................................................................................................23
49 U.S.C. 44711(a)(4).......................................................2, 12, 13, 15, 17, 18, 19, 20, 21, 23, 25
49 U.S.C. 46101(a)(1).................................................................................................................20
49 U.S.C. 46101(a)(2).................................................................................................................20
49 U.S.C. 46101(a)(4).................................................................................................................20
49 U.S.C. 46106 ..........................................................................................................................21
49 U.S.C. 46107(b)(1)(A) ...........................................................................................................21
49 U.S.C. 46108 ..............................................................................................................13, 14, 22
49 U.S.C. 46110(a) .....................................................................................................................20
49 U.S.C. 46301(a)(1)(A) ...........................................................................................................20
49 U.S.C. 46316 ..........................................................................................................................21
49 U.S.C. 47107 ..........................................................................................................................24
Rules
Fed. R. Civ. P. 12(b)(6)................................................................................................................1, 4
vii
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TABLE OF AUTHORITIES
(continued)
Page(s)
Regulations
14 C.F.R. 383.2 ...........................................................................................................................20
14 C.F.R. 13.305 .........................................................................................................................20
Other Authorities
DOT Order 2015-10 (Jan. 15, 2015) ..............................................................................................20
DOT Order 2014-10-14 (Oct. 17, 2014) .......................................................................................20
FAA Case No. 2012WP350025 (Feb. 11, 2015) ..........................................................................20
FAA Case No. 2009EA700512 (Sept. 30, 2013) ...........................................................................20
Treatises
13 Am. Jur. 2d Carriers 289 .........................................................................................................6
SAUL SORKIN, 1 GOODS IN TRANSIT 1.01[1][b] ............................................................................6
viii
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INTRODUCTION
The complaint in this case reads more like a press release than a pleading. Instead of
detailing the operative facts or explaining the governing law, Plaintiffs make lengthy publicpolicy arguments about the conservation benefits of trophy hunting. Whatever the merits of
those arguments might be, they do nothing to establish that Delta is legally obligated to accept
and carry as cargo trophies from the killing of big game.
All three of Plaintiffs claims suffer from fatal and incurable flaws. Plaintiffs claim
under the federal common law fails because the facts as pleaded in the complaint do not establish
that Delta has breached any of its federal common-law duties as a common carrier. The Airline
Deregulation Act of 1978 preempts Plaintiffs state-law claim for tortious interference with
business relations. And Plaintiffs statutory claims fail for two reasons: Congress did not create
a private right of action under Title 49, Subtitle VII of the United States Code (commonly
referred to as the Federal Aviation Act) save for a single provision, and Plaintiffs have not
pleaded any facts to suggest that Delta has violated that provision.
In short, Plaintiffs seek to bring claims they do not have in a forum they cannot access to
enforce duties that do not exist. For these reasons, and as explained more fully below, Delta
respectfully asks the Court to dismiss the complaint under Federal Rule of Civil Procedure
12(b)(6) for failure to state a claim upon which relief can be granted.
BACKGROUND
Delta is an international air carrier engaged in the business of providing commercial air
transportation of both passengers and cargo throughout the United States and the world. See
Complaint for Declaratory and Injunctive Relief (ECF 1) (Compl.) 19. Delta does not accept
for shipment as cargo any lions, leopards, elephants, rhinoceroses, or buffalo that have been
killed and taken as trophies. Id. 41. Through this lawsuit, Plaintiffsone individual hunter,
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three organizations whose members are hunters, one organization whose members are Tanzanian
tour operators, and one organization whose membership is less clear but claims to represent the
interests of communities in Zimbabwe, id. 1318seek to force Delta to carry trophy kills as
cargo. Id. 12; see also id. at 2627 34.
The complaint asserts three claims. Count One alleges that Deltas refusal to carry
trophy kills is a form of unreasonable discrimination. Plaintiffs bring this claim under 49 U.S.C.
41310(a), the federal common law, and unspecified federal regulations. Count Two is a claim
under Texas law for tortious interference with business relations. Count Three alleges that
Deltas refusal to carry trophy kills violates two of the Federal Aviation Acts certificate
requirements: (1) the requirement under 49 U.S.C. 41101(a)(1) that Delta hold a certificate of
public convenience and necessity (which is issued by the Department of Transportation); and (2)
the requirement under 49 U.S.C. 44711(a)(4) that Delta hold and comply with the terms of an
operating certificate (which is issued by the Federal Aviation Administration).1
Plaintiffs devote a good chunk of space in the complaint to articulating various harms
they believe have been or will be caused by Deltas refusal to carry trophy kills as cargo, but
most of these harms are not legally cognizable. Plaintiffs anticipate that many hunters will
respond to Deltas trophy ban by choosing not to go safari hunting in Africa, and much of the
complaint focuses on the harms Plaintiffs believe will occur as consequence of that choice. Id.
6, 9, 32, 5355, 57. But if the hunters who make that choice are not members of the plaintiff
1
For the Courts reference, a copy of Deltas FAA-issued operating certificate is attached to this motion
as Exhibit A and a copy of the DOT-issued certificate of public convenience and necessity implicated by
this case is attached as Exhibit B (Delta holds many different DOT-issued certificates, which are issued
separately and authorize various different routes in both interstate and foreign air transportation). It is not
clear that the Court needs to consider Deltas certificates to decide this motion, but it may do so if it
wishes since the certificates are attached to the motion, central to the claim[s], and referenced by the
complaint. See Lone Star Fund V (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010).
Page 12 of 36 PageID 63
organizations, any harm their choices cause Plaintiffs is not actionable in this lawsuit: it is well
settled that an injury that is the result of the independent action of some third party not before
the court is not fairly traceable to the challenged action of the defendant. Ariz. Christian Sch.
Tuition Org. v. Winn, 536 U.S. 125, 134 (2011) (brackets omitted) (quoting Lujan v. Defenders
of Wildlife, 504 U.S. 555, 560 (1996)). And if the hunters who choose not to go on safari are
members of the plaintiff organizations, it is equally well settled that a plaintiffs self-inflicted
injuries . . . are not fairly traceable to the actions of the defendant. ACORN v. Fowler, 178
F.3d 350, 358 (5th Cir. 1999) (quoting Bennett v. Spear, 520 U.S. 154, 162 (1997)).
The extent to which any of the Plaintiffs has a personal stake in this controversy is
minimal at best. The complaint does not allege that Deltas trophy ban has prevented Plaintiffs
from going on safari hunts in Africa or made it impossible for Plaintiffs to ship their trophies to
the United States. In fact, the complaint admits that Plaintiff Corey Knowlton was able to use a
different carrier to ship his trophy to the U.S. after he killed a black rhino in Namibia last
summer. Id. 10; see also id. 52. Nonetheless, Mr. Knowlton alleges that he has been injured
by Deltas trophy ban because he suffered delay and greater expense in shipping his blackrhino trophy home. Id. 10, 52. The complaint does not specify the length of this alleged
delay. Nor does it specify how much it would have cost Mr. Knowltonwho paid $350,000 for
the permit that allowed him to kill that black rhino, id. 16to ship his trophy home on Delta
versus what it cost him on the carrier he actually used. Whether Plaintiffs will be able to
substantiate these vague allegations of insubstantial injury is a question that, if it needed to be
answered, could be left for another day. See generally Lujan, 504 U.S. at 561. But there is no
need to answer that question: it is clear today that the claims Plaintiffs have alleged fail as a
matter of law, and those claims should be dismissed for the reasons discussed in detail below.
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ARGUMENT
The Court should dismiss the complaint because it fails to state a claim upon which relief
can be granted. See Fed R. Civ. P. 12(b)(6). Dismissal under Rule 12(b)(6) is warranted when
the complaint fails to state a claim that is a factually plausible and legally viable even when all of
its factual allegations are presumed to be true. Ashcroft v. Iqbal, 556 U.S. 662 (2009); Bell Atl.
Corp. v. Twombly, 550 U.S. 544 (2007).
I.
Deltas policy of refusing to carry trophy kills as cargo does not violate any
common-law duty.
The Court should dismiss the portion of Count One that seeks relief under the federal
common law because Delta (like every common carrier) has the legal right to determine what
kinds of cargo it will and wont carry. There is no dutycommon-law, statutory, regulatory, or
otherwisethat requires a common carrier to accept and carry as cargo whatever item a wouldbe shipper would like to transport. Common carriers routinely adopt policies of refusing to carry
certain kinds of cargo; those policies are a standard, permissible exercise of the carriers business
judgment. A common-law rule that prohibited the adoption of those policies would jeopardize
the airlines ability to make informed business decisions about which services to offer, thereby
undermining Congresss goal of relying on actual and potential competitionnot government
strictureto decide on the variety of available air transportation services. See 49 U.S.C.
40101(a)(12)(B). Delta is well within its rights to refuse to carry trophy kills.
Plaintiffs argument that Delta has breached a common-law duty by refusing to carry
trophy kills has no basis in law. The common law imposes a duty of equal treatment on common
carriers, but that duty only requires a common carrier to treat all shippers equally. It does not
obligate the carrier to accept any and all types of cargo. As the case law cited in this section
makes clear, common carriers have always had the right to limit what types of cargo they will
Page 14 of 36 PageID 65
accept for shipment, so long as the carrier applies those limits equally and evenhandedly to all
customers. That is precisely what Delta has done here. Deltas policy of refusing to carry trophy
kills as cargo applies on the same terms to every would-be shipper. For this reason, the facts
alleged in the complaint do not make out a violation of any cognizable common-law duty.
A common carrier is any carrier that has held itself out to the public as being willing to
transport persons or property for compensation, to the extent that its facilities permit. Woolsey
v. N.T.S.B., 993 F.2d 516, 522 (5th Cir. 1993). A common carrier makes an offer to the public
at large to provide a specified service on specified terms and undertakes to carry . . .
indifferently for any person who accepts that offer. Natl Assn of Regulatory Util. Commrs v.
F.C.C., 525 F.2d 630, 641 (D.C. Cir. 1976). Familiar examples of common carriers include
railroads, taxicab companies, and bus lines.
While the regulation of common carriers once was the domain of the common law, today
the field has been almost entirely occupied by various federal statutes. In some places, those
statutes regulate certain aspects of a common carriers business. In other places, a statute
dictates that a particular aspect of the carriers business will not be regulated at all. For example,
the Airline Deregulation Act of 1978 significantly scaled back the extent to which the Federal
Aviation Act of 1958the primary federal statute regulating foreign and interstate air
transportationregulates the economic aspects of air transportation.
Despite this heavy statutory overlay, a few common-law causes of action remain
available against common-carrier airlines under the federal common law. As amended by the
Airline Deregulation Act, the Federal Aviation Act contains an elaborate, comprehensive scheme
of administrative and judicial remedies. But the ADA also included a savings clause under
which any remedy provided by the Federal Aviation Act is in addition to any other remedies
Page 15 of 36 PageID 66
provided by law. 49 U.S.C. 40120(c). In Sam L. Majors Jewelers v. ABX, Inc., the Fifth
Circuit held that this savings clause preserves a small, discrete set of causes of action against air
carriers under federal common law. 117 F.3d 922, 928 (5th Cir. 1997).2
Section 40120(c) only saves common-law causes of action that had been clearly
established by 1978; the ADAs original savings clause preserved remedies now existing at
common law, and it was re-enacted without substantive change as 49 U.S.C. 40120(c). Sam
L. Majors Jewelers, 117 F.3d at 928 & n.13 (emphasis added). Section 40120(c) does not
authorize the creation of new common-law causes of action. See Musson Theatrical, Inc. v. Fed.
Exp. Corp., 89 F.3d 1244, 1252 (6th Cir. 1996) (The existence of a general savings clause in a
federal statute does not license a court to create a federal cause of action when the plaintiff
cannot meet the normal requirements for the implication of a private right of action.). Thus,
to proceed under federal common law, Plaintiffs must identify a cause of action that had been
recognized before 1978 that entitles them to the relief they seek.
The federal common law has never recognized a cause of action against a common
carrier based on the carriers categorical refusal to carry a particular type of cargo.
An
unlimited duty of carriage was never the rule. B.J. Alan Co. v. I.C.C., 897 F.2d 561, 563 (D.C.
Cir. 1990) (Ginsburg, R.B., J.); see also 13 Am. Jur. 2d Carriers 289 (a common carrier of
goods is not obliged to receive and transport all kinds of goods that may be offered for
carriage); SAUL SORKIN, 1 GOODS IN TRANSIT 1.01[1][b] (Lexis updated through 2015) ([A]
regulated common carrier does not have an unlimited duty to carry goods.).
By contrast, most causes of action under state common law are not saved because the ADA contains a
broad-sweeping preemption provision that preempts any state lawincluding business-tort claimsthat
seeks to challenge an airlines prices, routes, or services. This preemption provision is discussed in
greater detail below, in section II.
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In fact, the common law has always given common carriers the right to delineate what
they will carry and carry only a limited class of cargo. Delta Air Lines, Inc. v. Civil
Aeronautics Bd., 543 F.2d 247, 259 (D.C. Cir. 1976); accord Riffin v. Surface Transp. Bd., 733
F.3d 340, 345 (D.C. Cir. 2013) (at common law carriers could pick and choose the goods which
they would transport in common carriage . . . . (quoting Akron, Canton & Youngstown R.R. Co.
v. I.C.C., 611 F.2d 1162, 1166 (6th Cir. 1979))); Adkins v. Slater, 298 S.E.2d 236, 240 (W. Va.
1982) ([A] common carrier need not agree to carry all kinds of property[.] At common law a
man might become a common carrier of just such kinds of property as he chose. (citation
omitted)). As the Supreme Court has explained, a common carrier may limit his services to the
carriage of particular kinds of goods, and, if the carrier has done so, it is liable for refusal to
carry only if the goods offered for shipment are within the course of his employment. York
Co. v. Cent. R.R., 70 U.S. (3 Wall.) 107, 112 (1865).
For example, federal common law permits a common carrier by air to adopt a cargo
policy under which the carrier will not accept for shipment any package with an actual value of
more than $50,000. Treiber & Straub, Inc. v. U.P.S., Inc., 474 F.3d 379, 386 (7th Cir. 2007)
(Wood, J.). The reason is simple: a common carrier is not obliged to accept every package.
Id. Rather, the decision about what types or categories of cargo to accept for carriage is a
business decision that [the carrier] is entitled to make. Id.
The common law did recognize an equal-treatment principle that required common
carriers to treat all shippers alike. Mo. Pac. R. Co. v. Larabee Flour Mills Co., 211 U.S. 612,
620 (1909). This equal-treatment principle prohibited a common carrier from refusing to do for
one [shipper] that which it was doing for others. Id. at 619; see, e.g., Moor v. Tex. & N.O.R.
Co., 75 F.2d 386, 387 (5th Cir. 1935) (common carrier that regularly received bales of cotton for
Page 17 of 36 PageID 68
shipment could not refuse to accept bales of cotton tendered by plaintiff). But this equaltreatment principle did not prohibit a common carrier from refusing to carry certain types or
categories of cargo so long as that refusal was made in behalf of shippers generally. Mo. Pac.
R., 211 U.S. at 620; see, e.g., Kan. State Bank & Trust Co. v. Emery Air Freight Corp., 656 F.
Supp. 200, 205 (D. Kan. 1987) (approving of a common carriers policy of refusing to carry as
cargo currency, negotiable securities, and other similar items).
In short, the common laws equal-treatment principle creates nothing more than a
conditional duty: if a [common carrier] offers [a particular] service to the public . . . , it must
make that service available to any person without discrimination. Am. Trucking Assns v.
Atchison, T. & S. F. Ry. Co., 387 U.S. 397, 406 (1967) (emphasis added). Nothing in the
common law requires every common carrier to offer every possible type of service to the public.
Delta has not breached any of its common-law duties as a common carrier by adopting a
policy of refusing to carry trophy kills as cargo. The federal common law has never recognized a
cause of action against a common carrier for adopting an evenhanded, non-discriminatory policy
under which the carrier refuses to accept a certain type of cargo from any would-be shipper.
And that is precisely what Delta has done. This is not a case where Delta is carrying trophy kills
for some shippers but not for Plaintiffs. Delta does not carry trophy kills as cargo for anyone.
Plaintiffs are treated exactly the same as all other Delta customers. Plaintiffs claim against
Delta is based on an imagined duty requiring Delta to indiscriminately accept every type of cargo
that might be tendered for shipment. That duty does not exist. At common law, a carrier is
within its rights to adopt a policy under which it refuses to carry certain types of cargo. E.g.,
Treiber & Straub, 474 F.3d at 386; Kan. State Bank & Trust, 656 F. Supp. at 205. Accordingly,
the Court should dismiss the portion of Count One that seeks relief under federal common law.
II.
Page 18 of 36 PageID 69
The Airline Deregulation Act of 1978 preempts Plaintiffs state-law claim for
tortious interference with business relations.
The Court should dismiss Count Two of the complaint as preempted by federal law.
Binding Fifth Circuit precedent holds that the Airline Deregulation Act of 1978 preempts a claim
for tortious interference with business relations if the claim involves any of an airlines
services to customers. Lyn-Lea Travel Corp. v. Am. Airlines, Inc., 283 F.3d 282, 288 (5th Cir.
2002). Carriage of cargo is one of an airlines services to its customers. Accordingly, the ADA
preempts Plaintiffs claim for tortious interference with business relations.
Up until 1978, the airline industry was heavily regulated, essentially functioning as a
cost-plus regulated oligopoly. Under the Federal Aviation Act of 1958, airlines were required to
file tariffs with the Civil Aeronautics Board listing their routes, prices, services, as well as terms
and conditions of service, and they were prohibited from charging or collecting rates or
providing services which varied from their tariffs. Sam L. Majors Jewelers, 117 F.3d at 927.
As noted above, Congress enacted the Airline Deregulation Act in 1978 with the goal of
end[ing] federal economic regulation of commercial aviation and promot[ing] competition
within the airline industry. Am. Airlines, Inc. v. Dept of Transp., 202 F.3d 788, 805 (5th Cir.
2000). To be sure, airlines remain subject to extensive regulation by the FAA on matters of
safety, by the Transportation Security Administration on security-related matters, and by the
DOT on matters relating to consumer protection. But the Airline Deregulation Act abolished the
Civil Aeronautics Board and its heavy-handed authority to dictate an air carriers rates, rules,
and practices. Sam L. Majors Jewelers, 117 F.3d at 929. The ADA reflects Congresss
judgment that efficiency, innovation, low prices, variety, and quality in the airline industry are
better promoted by reliance on competitive market forces rather than pervasive federal
regulation. Hodges v. Delta Air Lines, Inc., 44 F.3d 334, 335 (5th Cir. 1995) (en banc).
Page 19 of 36 PageID 70
To ensure that the States would not undo federal deregulation with regulation of their
own, Congress included a preemption provision in the ADA. Morales v. Trans World Airlines,
504 U.S. 374, 378 (1992). The ADAs preemption provision prohibits the states from enacting
any law, regulation, or other provision having the force and effect of law related to a price,
route, or service of an air carrier.
49 U.S.C. 41713(b)(1).
interpreted the preemptive effect of the ADA broadly. Onoh v. Nw. Airlines, Inc., 613 F.3d
596, 599 (5th Cir. 2010). While the ADA does not preempt pure breach-of-contract claims, Am.
Airlines, Inc. v. Wolens, 513 U.S. 219, 22830 (1995), it does preempt any common-law tort
claim that has a connection with or reference to an airlines prices, routes, or services, Northwest,
Inc. v. Ginsberg, 134 S. Ct. 1422, 142930 (2014). In practice, this means 41713(b)(1)
preempts business-tort claims against airlines while leaving claims for personal injury or
property damage largely undisturbed. Lyn-Lea Travel, 283 F.3d at 288; Hodges, 44 F.3d at 336.
Consistent with the Supreme Courts direction that 41713(b)(1) expresses a broad
preemptive purpose, the Fifth Circuit has held that the ADA preempts any claim under state law
for tortious interference with business relations that involves [an airlines] prices and services
to customers. Lyn-Lea Travel Corp., 283 F.3d at 288. The Fifth Circuit is not alone. Federal
courts routinely dismiss tortious-interference claims on preemption grounds when the claim
challenges some aspect of an airlines prices or services.3
See, e.g., Overka v. Am. Airlines, Inc., 790 F.3d 36, 3940 (1st Cir.) (ADA preempts a tortiousinterference claim challenging an airlines provision of curbside baggage-handling services), cert. denied,
136 S. Ct. 372 (2015); Brown v. United Airlines, Inc., 720 F.3d 60, 61, 71 (1st Cir. 2013) (same); United
Airlines, Inc. v. Mesa Airlines, Inc., 219 F.3d 605, 61011 (7th Cir. 2000) (Easterbrook, J.) (tortiousinterference claim challenging a major carriers allocation of routes to its regional code-share partners);
Illinois Corp. Travel, Inc. v. Am. Airlines, Inc., 889 F.2d 751, 754 (7th Cir. 1989) (tortious-interference
claim challenging an airlines policy banning travel agencies from advertising discounted ticket prices);
Alaska Airlines, Inc. v. Carey, No. 3:07-cv-5711, 2008 WL 2725796, at *4 (W.D. Wash. July 11, 2008)
(tortious-interference claim challenging the terms and conditions of an airlines frequent flyer mileage
Page 20 of 36 PageID 71
An airlines carriage of cargo (or refusal to carry cargo) is a service within the meaning
of 41713(b)(1). Hodges, 44 F.3d at 337 (the term air service includes to the point-to-point
transportation of cargo). The Fifth Circuit has explained that the term service includes any
bargained-for or anticipated provision of labor from one party to another that is necessarily
included in the contract between airline and the customer. Id. at 336. An airlines provision of
cargo services is necessarily included in the air waybill, a specific type of contract whose sole
purpose is to establish the terms and conditions governing the airlines carriage of cargo. See,
e.g., Trujillo v. Am. Airlines, Inc., 938 F. Supp. 392, 394 (N.D. Tex. 1995) (Fitzwater, J.) (ADA
preempts state-law tort claims arising out of an airlines preparation of the Waybill and shipping
of the package), affd, 98 F.3d 1338 (5th Cir. 1996).
As these cases make clear, 41713(b)(1) preempts Plaintiffs claim for tortious
interference with business relations. Plaintiffs tortious-interference claim arises directly out of
Deltas provision of cargo services. The conduct Plaintiffs allege to be tortiousDeltas refusal
to accept trophy kills as cargois Deltas adoption and enforcement of a policy governing the
scope of its cargo services. Plaintiffs thus seek to use Texas tort law to regulate what kinds of
cargo Delta must carryspecifically, to compel Delta to accept lawfully permitted Big Five
(Cont'd from previous page)
plan), affd, 395 F. Appx 476 (9th Cir. 2010); A.I.B. Express, Inc. v. FedEx Corp., 358 F. Supp. 2d 239,
25354 (S.D.N.Y. 2004) (tortious-interference claim challenging changes to a cargo carriers prices and
services in connection with shipments of valuable jewelry); Contl Airlines, Inc. v. United Air Lines, Inc.,
120 F. Supp. 2d 556, 57073 (E.D. Va. 2000) (tortious-interference claim challenging an airlines carryon baggage policy and boarding procedures); Wine & Spirits Wholesalers of Mass., Inc. v. Net Contents,
Inc., 10 F. Supp. 2d 84, 87 (D. Mass. 1998) (tortious-interference claim challenging a carriers policy of
accepting wine as cargo); Virgin Atl. Airways Ltd. v. British Airways PLC, 872 F. Supp. 52, 59, 6667
(S.D.N.Y. 1994) (tortious-interference claim challenging airlines marketing practices, route changes, and
pricing decisions); Contl Airlines, Inc. v. Am. Airlines, Inc., 824 F. Supp. 689, 69294, 697 (S.D. Tex.
1993) (tortious-interference claim challenging airlines ticket-pricing system and reduced ticket prices);
Frontier Airlines, Inc. v. United Air Lines, Inc., 758 F. Supp. 1399, 140810 (D. Colo. 1989) (tortiousinterference claim challenging airlines computerized reservation services).
11
Page 21 of 36 PageID 72
trophies for transport. Compl at 27, 4. There is no clearer candidate for preemption than a
state law requiring airlines to provide a specific service. See Air Transp. Assn of Am., Inc. v.
Cuomo, 520 F.3d 218, 223 (2d Cir. 2008) (per curiam).
Delta has made a business decision to stop carrying trophy kills as cargo. Other carriers
are free to make a different decision (and some have, see Compl. 33, 36). Plaintiffs clearly
disagree with Deltas decision. And they are free to express that disagreement by taking their
business to other carriers who accept trophy kills as cargo. What Plaintiffs are not free to do
what the ADAs preemption provision prohibitsis bring a tortious-interference claim that, if
successful, would force Delta to provide a type of cargo service that it does not now provide
and would prefer not to offer. See Rowe v. N.H. Motor Transp. Assn, 552 U.S. 364, 372
(2008).4 Permitting Plaintiffs tortious-interference claim to go forward would allow the State of
Texas to substitute its own governmental commands in the place of competitive market
forces . . . in determining the [cargo] services that [Delta] will provide. See id. (quoting
Morales, 504 U.S. at 378). This is the very effect that Congress sought to avoid when it
enacted 41713(b)(1). Id. The Court, therefore, should dismiss Count Two of the complaint.
III.
Plaintiffs cannot state a claim under 49 U.S.C. 41101(a)(1) because Delta holds a
certificate of public convenience and necessity.
Count Three of the complaint alleges a violation of 49 U.S.C. 41101(a)(1), but
Plaintiffs cannot state a claim under 41101(a)(1) because the Department of Transportation has
issued the appropriate certificate of public convenience and necessity to Delta. The fact that
Delta holds an applicable certificate of public convenience and necessity is sufficient by itself to
defeat any claim under 41101(a)(1).
4
Rowe construed the preemption provision of a different federal statute, but the Court held that
41713(b)(1) and the statute at issue in Rowe are identical in meaning and scope. See 552 U.S. at 370.
12
Page 22 of 36 PageID 73
Title 49 U.S.C. 46108 allows [a]n interested person [to] bring a civil action in federal
district court to enforce section 41101(a)(1) of this title. In turn, 41101(a)(1) provides that
an air carrier may provide air transportation only if the air carrier holds a certificate issued
under this chapter authorizing the air transportation. As used in 41101(a)(1), the term a
certificate issued under this chapter refers to a certificate of public convenience and necessity
issued by the DOT. Id. 41102(a)(1).
The complaint reflects some confusion on two important points. To begin with, Delta
holds two different required certificates that are relevant to this lawsuit. Delta holds a certificate
of public convenience and necessity, which is issued by the DOT and establishes that Delta is fit,
willing, and able to provide air transportation along the specified route. See 49 U.S.C. 41102.
Delta also holds an operating certificate (officially known as an Air Carrier Certificate), which is
issued by the Federal Aviation Administration and pertains exclusively to safety-related matters
not implicated by the complaint. See 49 U.S.C. 44702, 44705; see also Walker Decl. 7.
In addition, the case law recognizes a distinction between an action to enforce the
requirement that a carrier hold a certificate of public convenience and necessity and an action to
force the carrier to comply with the certificates terms. In Peninsula Airport Commission v.
National Airlines, Inc., the plaintiff alleged that a change in service proposed by the defendant
airline was a breach of the terms and conditions of [the airlines] certificate. 436 F. Supp. 850,
852 (E.D. Va. 1977). The district court explained that the statutory predecessor to 46108
expressly limits a private party in interest, such as the plaintiff, to enforce [the statutory
predecessor to 41101(a)(1)], which requires a certificate, while the plaintiffs suit sought to
enforce . . . the terms of [the defendants] certificate. Id. Under the Federal Aviation Act, the
terms and conditions of certificates[,] if to be enforced through court action[,] are to be enforced
13
Page 23 of 36 PageID 74
by the Board [now, the DOT]. Id. The district court therefore dismissed the complaint on the
ground that a private plaintiffs exclusive remed[y] for . . . breach of the duties imposed by
certificates is to petition the appropriate federal agency. Id. at 853.
Thus, the scope of the private right of action created by 46108 is quite limited. Section
41101(a)(1) is concerned only with ensuring that a carrier holds a DOT-issued certificate of
public convenience and necessity. E.g., Casas v. Am. Airlines, Inc., 304 F.3d 517, 523 (5th Cir.
2002). Section 41101(a)(1) is not concerned with ensuring that a carrier is complying with that
certificates terms. Nor does 41101(a)(1) address itself to enforcing the requirements that a
carrier hold and comply with the terms of an FAA-issued operating certificate. Section 46108
only authorizes private plaintiffs to bring a single, very narrow type of claim: a claim that an
airline is operating without a DOT-issued certificate of public convenience and necessity. E.g.,
Monarch Travel Servs., Inc. v. Assocd Cultural Clubs, Inc., 466 F.2d 552, 554 (9th Cir. 1972).
Plaintiffs have failed to plead facts that establish a violation of 41101(a)(1). The
complaint does not allege that Delta does not hold a certificate of public convenience and
necessity. Nor could it. Delta holds the requisite certificate of public convenience and necessity.
See Exhibit B; Walker Decl. 915. By obtaining this certificate from the DOT, Delta did
everything that 41101(a)(1) requires. Accordingly, the Court should dismiss the portion of
Count Three that seeks relief under 41101(a)(1).
IV.
Congress did not create a private right of action to enforce 49 U.S.C. 41310(a) and
44711(a)(4).
Plaintiffs two remaining statutory claims both fail for the same reason: there is no
private cause of action. Count One of the complaint alleges a violation of 49 U.S.C. 41310(a)
(which prohibits air carriers from engaging in unreasonable discrimination), while Count Three
alleges violations of 49 U.S.C. 44711(a)(4) (prohibiting a carrier from violating the terms of its
14
Page 24 of 36 PageID 75
operating certificate). The Fifth Circuit has repeatedly held that various provisions of the
[Airline Deregulation Act] do not give rise to implied private rights of action in favor of
individual passengers or other consumers. Casas, 304 F.3d at 522 n.7. The lack of a private
right of action is fatal to Plaintiffs claims under 41310(a) and 44711(a)(4).
A private plaintiff has the right to bring suit under a federal statute only if Congress
created that right. Alexander v. Sandoval, 532 U.S. 275, 286 (2001) (citing Touche Ross & Co.
v. Redington, 442 U.S. 560, 578 (1979)). Congress can create a private right of action expressly
or by implication. E.g., Sam L. Majors Jewelers, 117 F.3d at 925. The Federal Aviation Act
does not contain an express private right of action to enforce either 41310(a) or 44711(a)(4).
Accordingly, Plaintiffs have a right of action under those statutes only if they can show that
Congress intended to create that right by implication. They cannot.
There was a time when the federal courts would liberally imply private rights of action
whenever they perceived that doing so would further the purpose of a statute. E.g., J.I. Case Co.
v. Borak, 377 U.S. 426, 43335 (1964). But in Cort v. Ash, 422 U.S. 66 (1976), the Supreme
Court abandoned that approach and replaced it with a four-factor test that was more restrictive
than any of its predecessors. Landry v. All Am. Assur. Co., 688 F.2d 381, 388 (5th Cir. 1982).
Cort established that [t]he central inquiry in determining whether a statute includes a private
cause of action is whether Congress intended to create one. Touche Ross, 442 U.S. at 575.
This inquiry into Congresss intent is guided by four factors:
1. does the statute create a federal right in favor of the plaintiff?
2. is there any indication of legislative intent, explicit or implicit, [] to create a
private remedy?
3. is it consistent with the underlying purposes of the legislative scheme to
imply such a remedy?
4. is the cause of action one traditionally relegated to state law?
15
Page 25 of 36 PageID 76
Cort, 422 U.S. at 78. Every cause of action contains two ingredients: a private right and a
private remedy. Gonzaga Univ. v. Doe, 536 U.S. 273, 284 (2002) (quoting Sandoval, 532 U.S.
at 286). The first two Cort factors simply ask whether the statute manifests an intent to create
both of those ingredients. Id. If so, the analysis moves to the third and fourth factors, which
identify additional considerations that might nonetheless foreclose the implication of a private
right of action.
But the third and the fourth factors are relevant only if both of the first two
factors weigh in favor of a private right of action. If either of the first two factors is missing, the
analysis must end with the conclusion that there is no implied right of action. California v.
Sierra Club, 451 U.S. 287, 298 (1981); La. Landmarks Socy, Inc. v. City of New Orleans, 85
F.3d 1119, 1125 (5th Cir.1996); Allandale Neighborhood Assn v. Austin Transp. Study Policy
Advisory Comm., 840 F.2d 258, 267 (5th Cir. 1988).
In 2001, the Supreme Court curtailed the authority of the courts to recognize implied
rights of action even further with its decision in Alexander v. Sandoval. Lopez v. Jet Blue
Airways, 662 F.3d 593, 596 (2d Cir. 2011). While the central inquiry remains whether Congress
intended to create a private right of action, see Sandoval, 532 U.S. at 286, Sandoval articulated
two important new restrictions on how that intent is to be ascertained. First, Sandoval elevated
the second Cort factorwhether Congress intended to create a private remedyto a position of
primacy. See id. at 28687. Even where the first Cort factor suggests that the statute creates a
personal right, that right is not privately enforceable unless there is independent evidence that
Congress also intended to create a private remedy. See id. at 28991. Second, a private right of
action cannot be implied based on legislative history alone. Instead, the interpretive inquiry
begins with the text and structure of the statute. Id. at 288 n.7. Legislative history is relevant
ifand only ifstatutory text and structure have not resolved whether a private right of action
16
Page 26 of 36 PageID 77
should be implied. Love v. Delta Air Lines, 310 F.3d 1347, 1353 (11th Cir. 2002); see also
Sandoval, 532 U.S. at 288 (legal context matters only to the extent it clarifies text).
Sandoval both reflected and accelerated the federal courts ongoing retreat[] from [their]
previous willingness to imply a cause of action where Congress has not provided one. See
Corr. Servs. Corp. v. Malesko, 534 U.S. 61, 67 n.3 (2001). Today, courts seldom imply a
private right of action because of the strong presumption against their creation. Sam L. Majors
Jewelers, 117 F.3d at 925 n.3 (quoting Statland v. Am. Airlines, Inc., 998 F.2d 539, 540 (7th Cir.
1993)); see also Lundeen v. Mineta, 291 F.3d 300, 312 (5th Cir. 2002) (implying a private right
of action is presumptively disfavored).
In this case, an inquiry into Congresss intent in enacting the Federal Aviation Act
reveals that Congress had no intention to create a privately enforceable right of action.
Bonano v. E. Caribbean Airline Corp., 365 F.3d 81, 86 (1st Cir. 2004).
A.
To begin with, 44711(a)(4) and 41310(a) do not reflect an intent to create a federal
right in favor of Plaintiffs, as the first Cort factor requires. Neither statute uses the kind of
rights-creating language that focuses on the individuals who will ultimately benefit from the
statute. See Sandoval, 532 U.S. at 28889 (quotation omitted).
Section 44711(a)(4)which provides that a person may not operate as an air carrier
without an air carrier operating certificate or in violation of a term of the certificatelacks any
rights-creating language. The statute does not speak in terms of individuals it might benefit; its
exclusive textual focus is on the carriers it regulates. Statutes that focus on the person regulated
rather than the individuals protected create no implication of an intent to confer rights on a
particular class of persons. Sandoval, 532 U.S. at 289 (quoting California, 451 U.S. at 294).
Similarly, 41310(a) instructs that an air carrier or foreign air carrier may not subject a
17
Page 27 of 36 PageID 78
The second Cort factor also weighs against the implication of a private right of action.
The text and structure of the Federal Aviation Act make it clear that Congress did not intend to
create a private remedy for violations of either 41310(a) or 44711(a)(4). The most reliable
way to gauge whether Congress intended to create an implied private remedy is to examine the
menu of remedies that Congress expressly included in the statute. See Sandoval, 532 U.S. at
28991. Two features of the statutory remedial scheme are particularly important: the remedies
created for the statutory provision at issue, and the existence of a private right of action under
18
Page 28 of 36 PageID 79
any other provision of the statute. In the case of the Federal Aviation Act, both of those features
point to the same conclusion: Congress did not intend to authorize civil actions by private
plaintiffs under 41310(a) and 44711(a)(4). This factor, too, is dispositive by itself. See, e.g.,
California, 451 U.S. at 297 (the focus of the inquiry is on whether Congress intended to create a
remedy); Casas, 304 F.3d at 522 (the touchstone of the Cort analysis is its second factor).5
1.
The first feature of a statutory remedial scheme that is relevant to the private-right-ofaction analysis is whether Congress created other remedies for violations of the statutory
provision(s) at issue. The existence of an alternative remedial scheme strongly suggests that
Congress did not intend to create a private right of action. [I]t is an elemental canon of
statutory construction that where a statute expressly provides a particular remedy or remedies, a
court must be chary of reading others into it. Transamerica Mortgage Advisors, Inc. (TAMA) v.
Lewis, 444 U.S. 11, 19 (1979). For this reason, where a statute contains elaborate enforcement
provisions it cannot be assumed that Congress intended to authorize by implication additional
judicial remedies for private citizens. Middlesex Cnty. Sewerage Auth. v. Natl Sea Clammers
Assn, 453 U.S. 1, 14 (1981).
The Federal Aviation Act contains an elaborate and comprehensive scheme of
administrative and judicial remedies. Specifically, the Act creates an enforcement scheme under
which 41310(a) and 44711(a)(4) may be enforced in any of three ways, none of which
5
There is no need to engage in a separate private-right-of-action analysis concerning the allegations that
Deltas embargo on hunting trophy violates various unspecified federal regulations, see Compl. 63
(Count One), 7476 (Count Three). [A] regulation, on its own, cannot create a private right of
action. Bonano, 365 F.3d at 84 (citing Sandoval, 532 U.S. at 291). The proper inquiryand the only
necessary inquiryis whether the statute creates a private cause of action. Casas, 304 F.3d at 520. If
it does not, there can be no private right of action under regulations that merely interpret and implement
the statute. Sandoval, 532 U.S. at 28486, 291; Touche Ross, 442 U.S. at 577 n.18.
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Page 29 of 36 PageID 80
involves a private plaintiff filing suit in federal district court. The comprehensive scheme of
administrative and judicial remedies that Congress provided for the enforcement of 41310(a)
and 44711(a)(4) demonstrates that Congress did not intend to create any additional remedies.
First, the Act allows private plaintiffs to seek redress for a violation of the Act by
commencing an administrative proceeding. Specifically, 49 U.S.C. 46101(a)(1) allows any
person to file a complaint in writing with the DOT about a violation of any provision in Title
49, Subtitle VII, Part A, which includes both 41310 and 44711. The DOT is required to
investigate the complaint if a reasonable ground appears . . . for the investigation. Id.
Second, the DOT and the FAA may enforce the Acts provisions by commencing an
administrative proceeding on their own initiative. Id. 46101(a)(2).
The Act authorizes the DOT and the FAA to impose significant penalties in these
administrative enforcement proceedings after providing notice and an opportunity for a hearing:
These penalties are not paper tigers; the DOT and the FAA actively exercise their enforcement
authority.6 And that enforcement authority is backstopped by 49 U.S.C. 46110(a), which
allows any person disclosing a substantial interest in an order issued by the agency to seek
judicial review of that order in either the D.C. Circuit or the appropriate regional circuit.
Third, the Federal Aviation Act also provides two mechanisms by which its provisions
See, e.g., DOT Order 2015-10 (Jan. 15, 2015) (imposing $1.6 million penalty on Southwest Airlines for
violating DOT regulations); DOT Order 2014-10-14 (Oct. 17, 2014) (imposing $260,000 penalty Cathay
Pacific Airways); FAA Case No. 2012WP350025 (Feb. 11, 2015) (imposing at $350,000 penalty on
Hawaiian Airlines for violating FAA regulations); FAA Case No. 2009EA700512 (Sept. 30, 2013)
(imposing a $1,595,000 penalty on Federal Express).
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Page 30 of 36 PageID 81
may be enforced via a civil action in federal district court. The DOT may bring a civil action
against a person in a district court of the United States to enforce both 41310(a) and
44711(a)(4). See 49 U.S.C. 46106. And upon request from the DOT, the Attorney General
may bring a civil action in an appropriate court to enforce those same provisions.
Id.
46107(b)(1)(A). Violations of 41310(a) are also punishable by criminal fine. Id. 46316.
This elaborate enforcement scheme makes it clear that Plaintiffs inability to bring suit in
federal court would not leave them without a remedy if there were any merit to the statutory
violations they allege in their complaint (which there is not). More to the point, however, this
carefully integrated enforcement scheme reflects a considered, deliberate choice by Congress
that provide[s] strong evidence that Congress did not intend to authorize other remedies that it
simply forgot to incorporate expressly. Mass. Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 146
(1985). The Supreme Court held in Sandoval that [t]he express provision of one method of
enforcing a substantive rule suggests that Congress intended to preclude others. 532 U.S. at
290. Congress expressly provided not one but three methods of enforcing 41310(a) and
44711(a)(4).
administrative action in the courts of appeals, which powerfully suggests that Congress did not
intend to provide other rights of action. Love, 310 F.3d at 1357. And the third allows for
judicial enforcement through a civil action by either the DOT or the Attorney General,
suggesting Congress intended to place enforcement in the hands of [government officials],
rather than private parties.
See Freeman v. Fahey, 374 F.3d 663, 665 (8th Cir. 2004).
Congresss enactment of this integrated system of procedures for enforcement creates an allbut-irrebuttable presumption that a private right of action was deliberately omitted from [the]
statute. See Mass. Mut. Life Ins., 473 U.S. at 147 (quoting Nw. Airlines, Inc. v. Transp.
21
Page 31 of 36 PageID 82
The second feature of a statutes remedial scheme that is especially relevant to the
existence of an implied private right of action is the existence of any express private rights of
action. If Congress chose to create a private right of action for other provisions of the statutory
scheme but not for the provision(s) the plaintiff seeks to enforce, this choice weighs heavily
against any suggestion that Congress intended to create a private right of action by implication.
When Congress has established a detailed enforcement scheme, which expressly provides a
private right of action for violations of specific provisions, that is a strong indication that
Congress did not intend to provide private litigants with a means of redressing violations of other
sections of the Act. Casas, 304 F.3d at 523 (quoting Diefenthal v. Civil Aeronautics Bd., 681
F.2d 1039, 1049 (5th Cir. 1982)).
The Federal Aviation Act contains an express private right of action that does not
authorize suits to enforce 41310 or 44711. As discussed above, supra III, 49 U.S.C.
46108 gives private plaintiffs a cause of action to enforce the requirement in 41101(a)(1) that
an air carrier hold a DOT-issued certificate of public convenience and necessity.
Congresss decision to expressly create a private right of action under only one provision
of the Federal Aviation Act shows that Congress did not intend to create any other private rights
of action by implication. Section 46108 establishes that when Congress wished to provide a
private [] remedy, it knew how to do so and did so expressly. Till v. Unifirst Fed. Sav. & Loan
Assn, 653 F.2d 152, 160 (5th Cir. Unit A Aug. 1981) (quoting Touche Ross, 442 U.S. at 572).
The fact that Congress remembered to create an express private right of action to enforce
41101(a)(1) makes it highly improbable that Congress absentmindedly forgot to mention an
22
Page 32 of 36 PageID 83
intended private action to enforce other provisions of the Act. See TAMA, 444 U.S. at 20
(citation omitted)).
***
These two features of the Federal Aviation Acts remedial scheme demonstrate that
Congress did not intend to create by implication a private remedy allowing plaintiffs to bring suit
in federal court over alleged violations of 41310(a) and 44711(a)(4). Little wonder, then,
that the only federal court ever to take up the question concluded that no private right of action
exists under 44711(a). Spinner v. Verbridge, 125 F. Supp. 2d 45, 53 (E.D.N.Y. 2000). In the
same vein, numerous federal courts have concluded that section 41310 of the ADA does not
provide a private cause of action. Arif Naqvi v. Turkish Airlines, Inc., 80 F. Supp. 3d 234, 239
n.7 (D.D.C. 2015) ((brackets omitted) (quoting Gibbs v. Am. Airlines, Inc., 191 F. Supp. 2d 144,
146 (D.D.C.2002)); accord Elnajjar v. Nw. Airlines, Inc., No. 4:04-cv-680, 2005 WL 1949545,
at *6 (S.D. Tex. Aug. 15, 2005); Williams v. Midwest Express Airlines, Inc., 315 F. Supp. 2d
975, 979 (E.D. Wis. 2004).7
7
In a case that pre-dates Sandoval by almost twenty years, the Fifth Circuit once suggested that it had
recognized an implied private right of action under 49 U.S.C. 1374(b)the statutory predecessor to
41310(a)but that suggestion was incorrect and in any event does not bind this Court. In Diefenthal v.
Civil Aeronautics Board, 681 F.2d 1039 (5th Cir. 1982), the court cited Smith v. Piedmont Aviation, 567
F.2d 290 (5th Cir. 1978), for the proposition that [t]his circuit has implicitly recognized a private right of
action under section 1374(b). 681 F.2d at 1050. But Smith did nothing more than uphold a damages
award under 1374(b); it did not even acknowledgemuch less decidethe question of whether there
was a private right of action under 1374(b). See 567 F.2d at 292. As such, Smith is not precedent on
that question. E.g., Thomas v. Tex. Dept of Crim. Justice, 297 F.3d 361, 370 n. 11 (5th Cir. 2002)
(Questions which merely lurk in the record, neither brought to the attention of the court nor ruled upon,
are not to be considered as having been so decided as to constitute precedents. (quoting Webster v. Fall,
266 U.S. 507, 511 (1925))); accord De La Paz v. Coy, 786 F.3d 367, 373 (5th Cir. 2015) (quoting United
States v. Mitchell, 271 U.S. 9, 14 (1926)).
Diefenthals statement that the Fifth Circuit has implicitly recognized a private right of action
under section 1374(b) is also non-precedential. Diefenthal did not hold that private plaintiffs had a right
to bring claims under 1374(b). Diefenthals held that there had been no violation of the statute even if
an implied right of action exists under section 1374(b). 681 F.2d at 1050. Since Diefenthals statement
about the existence of a private right of action was not necessary to the result and could have been
Page 33 of 36 PageID 84
Whats more, the Fifth Circuit and at least three of its sister circuits have concluded that
49 U.S.C. 47107 and its predecessor statute do not create a private right of action for parties
aggrieved by alleged discrimination. McCasland v. City of Castroville, 514 F. Appx 446, 448
(5th Cir. 2013) (per curiam) (citing cases from the First, Sixth, and Eighth Circuits). These cases
are persuasive because 47107(a)(1)which requires operators of federally funded airports to
make their airports available for public use on reasonable conditions and without unjust
discriminationimposes a non-discrimination requirement that is very similar to 41310(a)s
requirement that airlines may not subject a person, place, port, or type of traffic in foreign air
transportation to unreasonable discrimination.
Congresss decision not to create a private right of action under the Federal Aviation Act
makes sense in light of the Acts purpose and design. Congress determined that the objectives
underlying the Act could be fulfilled only by a uniform and exclusive system of federal
regulation. City of Burbank v. Lockheed Air Terminal Inc., 411 U.S. 624, 639 (1973) (emphasis
added). The absence of a private right of action works hand in glove with the ADAs preemption
provision to ensure that federal regulation remains uniform and exclusive. Preemption ensures
that federal regulation remains exclusive by foreclosing regulation by the states. Rowe, 552 U.S.
at 373. In much the same way, the absence of a private right of action ensures uniform,
nationwide interpretation of the Act by centralizing enforcement authority in the hands of the
DOT and the FAA, the expert agenc[ies] created by Congress to enforce the statutory
scheme. Cf. United States v. Dunifer, 219 F.3d 1004, 1008 (9th Cir. 2000) (emphasis added)
(quoting N.Y. Tel. Co. v. N.Y. Dept of Labor, 440 U.S. 519, 528 (1979)). Creating a private
(Cont'd from previous page)
deleted without seriously impairing the analytical foundations of the holding, it is dictum and does not
bind this Court. See Intl Truck & Engine Corp. v. Bray, 372 F.3d 717, 721 (5th Cir. 2004).
24
Page 34 of 36 PageID 85
right of action would have undermined this carefully calibrated statutory design. If private
citizens could bring suit in any of this countrys 94 federal district courts, airlines would have
been subjected to a regulatory patchwork effect created on a verdict by verdict basis that
would have deprived them of the regulatory uniformity and predictability that Congress sought
to provide. Cf. Tobin v. Fed. Exp. Corp., 775 F.3d 448, 455 (1st Cir. 2014) (citing DiFiore v.
Am. Airlines, Inc., 646 F.3d 81, 88 (1st Cir. 2011)).
For all of these reasons, the Court should dismiss the portion of Count One that seeks
relief under 41310(a) and the portion of Count Three that seeks relief under 44711(a)(4).
CONCLUSION
Delta respectfully asks the Court to dismiss the complaint in its entirety with prejudice.
Dismissal with prejudice is warranted because the flaws in the complaint cannot be cured by
additional allegations in an amended pleading. There are no facts Plaintiffs could allege that
would undo the Airline Deregulation Acts preemption of state-law business-tort claims, create a
common-law duty or a statutory private right of action where none exists, or change the fact that
Delta holds a certificate of public convenience and necessity. Accordingly, the filing of an
amended complaint would be futile. E.g., Gallentine v. Hous. Auth. of City of Port Arthur, Tex.,
919 F. Supp. 2d 787, 817 (E.D. Tex. 2013) (leave to amend would be futile on claims that fail
as a matter of law). For this reason, Delta asks the Court to dismiss the complaint with
prejudice and without any opportunity to amend or re-plead. See, e.g., Varela v. Gonzales, 773
F.3d 704, 707 (5th Cir. 2014) (dismissal without leave to amend is appropriate where the
complaint as amended would be subject to dismissal (quoting Ackerson v. Bean Dredging LLC,
589 F.3d 196, 208 (5th Cir. 2009))).
25
Page 35 of 36 PageID 86
Respectfully submitted,
/s/ Russ Falconer________________
Russell H. Falconer
SBN 24069695
GIBSON, DUNN & CRUTCHER LLP
2100 McKinney Avenue, Suite 1100
Dallas, Texas 75201-6911
Telephone: (214) 698-3170
Facsimile: (214) 571-2958
rfalconer@gibsondunn.com
ATTORNEY FOR DELTA AIR LINES, INC.
26
Page 36 of 36 PageID 87
CERTIFICATE OF SERVICE
I hereby certify that on December 21, 2015, a true and correct copy of the foregoing
document was served via the CM/ECF system upon all counsel of record.
/s/ Russ Falconer
Russell H. Falconer
27
Page 1 of 6 PageID 88
NO. 3:15-CV-03348-M
I, Christopher A. Walker, make this declaration pursuant to 28 U.S.C. I 746 and hereby
declare the following under penalty of perjury.
1.
competent to make this declaration. The statements in this declaration are true and within
my personal knowledge.
2.
a Regional Director of Regulatory and International Affairs, and I have held this position
at Delta since February 2013. Among my duties at Delta, I ensure that the airline has all
of the necessary authority issued by the U.S. Department of Transportation (DOT) and the
Federal Aviation Administration (FAA) to permit Delta to operate over its existing and
future routes.
3.
An airline may not conduct commercial air carrier operations unless the
airline has received (among other permissions and approvals): (I) an operating certificate
-I -
Page 2 of 6 PageID 89
from the FAA, and (2) a certificate of public convenience and necessity from the DOT.
4.
certificates-a DOT-issued certificate of public convenience and necessity and an FAAissued operating certificate-necessary to conduct scheduled air-carrier service between
Atlanta, Georgia, and Johannesburg, South Africa (which I understand to be the route that
Delta flew in connection with the claims at issue in the above-captioned litigation).
and establishes that the certificate holder is competent, properly and adequately equipped,
and able to operate safely under applicable statutes and regulations. Because an operating
certificate applies to and authorizes all of an airline's operations, an airline only needs to
receive one operating certificate from the FAA. The type of operating certificate that Delta
holds is called an Air Carrier Certificate. By holding this certificate, Delta meets the
requirements of 49 U.S.C. 4471 l(a)(4).
6.
Exhibit A.
7.
In addition to requiring Delta to comply with the Federal Aviation Act, the
Air Carrier Certificate requires Delta to operate in accordance with the tenns, conditions,
and limitations contained in Delta's FAA-approved Operations Specifications.
The
Operations Specifications are a set of detailed operating rules that the FAA requires Delta
to adopt, maintain, and operate in accordance with. Except for those sections of the
Operations Specifications that delineate the type of operations Delta is authorized to
provide, the Operations Specifications are deemed "not a part of the certificate." See I 4
-2-
Page 3 of 6 PageID 90
C.F .R. 119. 7(b). With respect to cargo, the Operations Specifications are concerned with
safety-related matters, such as aircraft weight and balance (which addresses passenger and
cargo locations throughout the aircraft). However, nothing in the Operations Specifications
addresses the types of cargo Delta must transport or requires Delta to carry a particular type
of cargo if requested by a passenger or shipper.
authority and establishes that the certificate holder has the economic right to engage in
co1nmercial air transportation over specified routes or between specified countries.
Because certificates of public convenience and necessity are route- or nation-specific, an
airline may need to receive many different certificates of public convenience and necessity
from the DOT. These certificates allow an air carrier to provide air service in interstate
markets, over specified city-pair routes in international markets, or between the U.S. and
other countries without limits on the points being served. By holding a certificate of public
convenience and necessity, Delta meets the requirements of 49 U.S.C. 41 lOl(a)(l). See
49 U.S.C. 41102(a)(l).
9.
public convenience and necessity to operate between Atlanta and Johannesburg, among
other cities, are attached to this declaration as Exhibit B, Attachments 1 through 5.
I 0.
Attachment I to Exhibit B shows that Delta 11as been awarded the authority
by the DOT to provide scheduled air service between points in the United States and
Johannesburg, South Africa. Delta first acquired this authority from then-bankrupt Pan
American World Airways ("Pan Am") in 1991. The DOT approved the transfer of Pan
-3-
Page 4 of 6 PageID 91
Am's transatlantic authority on Route 616 to Delta by DOT Order 91-10-33, issued
October 11, 1991. Attachment 1. Specifically, on segment 12 of Route 616 Delta gained
the authority to operate between specified co-terminal points in the U.S. (New York and
Boston) via named intermediate points and the terminal point Johannesburg, South Africa.
11.
Attachment 2 to Exhibit B shows that Delta has been awarded the authority
by the DOT to provide scheduled air service on many routes involving its major hub of
Atlanta, Georgia. Attachment 2 is a copy of DOT Order 2008-12-20. Attachment D to
that Order lists the certificates of public convenience and necessity previously issued to
Delta, many of which describe routes that name Atlanta as a point in the U.S. on a foreign
route.
12.
route authority described in Attachment I (routes involving Johannesburg) with the route
authority described in Attachment 2 (routes involving Atlanta). Consistent with the policy
of the Department of Transportation to grant route authority to U.S. air carriers with the
broadest number of points capable of being served in order to stimulate competition among
and between both U.S. and foreign air carriers, the DOT has permitted carriers to integrate
their route authority so that a carrier can combine points (cities) named on one route
segment with points named on a separate route segment. The DOT has granted Delta such
route integration authority by the series of Notices of Action Taken in Docket OST-972338. See Attachment 3.
13.
-4 -
Page 5 of 6 PageID 92
Attachment 4. The DOT has not yet ruled upon Delta's pending application but the route
integration authority remains effective until the DOT does so in accordance with 5 U.S.C.
558(c) and Part 377 of the DOT's regulations (49 C.F.R. Part 377). See 5 U.S.C. 558(c)
(once a "timely and sufficient application for a renewal" is filed, "a license with reference
to an activity of a continuing nature does not expire until the application has been finally
determined by the agency").
14.
certain number of flights each week between Atlanta and Johannesburg. In 2006, Delta
requested 7 weekly frequency allocations to operate scheduled service between Atlanta and
Johannesburg. The need for a frequency allocation to accompany the route authority is due
to the fact that the Air Services Agreement between the U.S. and South Africa limits the
number of weekly flights by each country's carriers to a specified maximum of21. The
DOT issues frequency allocations to U.S. carriers so as to avoid exceeding the bilaterally
established limit of weekly flights by carriers of the United States. At the time Delta sought
the 7 weekly Johannesburg frequencies, it notified the DOT that it would be relying on the
authority previously issued to Delta by the DOT to integrate any of Delta's existing route
authority with any other route authority held by Delta (see Attachments 3 and 4), subject
to the operation othenvise being consistent witl1 the Air Services Agreement between the
United States and South Africa. Delta had authority to operate to and from Atlanta in
foreign air transportation on any number of routes. See Attachment 2. Delta also had
authority to serve Johannesburg on Route 616. See Attachment I. Accordingly, the DOT
issued a Notice of Action Taken on February 27, 2007 that issued Delta 7 weekly
frequencies for the purpose of serving the Atlanta-Johannesburg city pair market and
-5-
Page 6 of 6 PageID 93
received from the DOT all of the economic authority it needs-all of the authority that 49
U.S.C. 41 lOl(a)(l) requires- to offer to the public flights between Atlanta and
Johannesburg, subject only to the limit on the number of weekly flights Delta is permitted
to operate between the two points.
***
I declare under penalty of perjury that the foregoing is true and correct.
Executed on this 21st day of December, 2015
-6-
Page 1 of 2 PageID 94
EXHIBIT A
Page 2 of 2 PageID 95
Page 1 of 65 PageID 96
EXHIBIT B
Page 2 of 65 PageID 97
Attachment 1
Page 3 of 65 PageID 98
Order 91-10-33
').
Joint Application of
DELTA AIR LINES, INC.
and
PAN AMERICAN WORLD AIRWAYS, INC.
Docket 47675
FINAL ORDER
On August 2, 1991, Delta Air Lines, Inc. and Pan American World Airways,
Inc., applied for approval under section 401(h) of the Federal Aviation Act of
a transfer of Pan American's transatlantic routes, except for its Miami-Paris
and Miami-Frankfurt routes, to Delta. By Order 91-9-53, issued September 25,
1991, we tentatively approved the applicationl, with the exception of the
Detroit-London route, on which we deferred action pending the receipt of
certain information.2
Comments on Order 91-9-53 have been filed by the Official Committee of
Unsecured Creditors of Pan Am Corporation (the Creditors), Alaska Airlines,
and Aeronautics Leasing, Inc. (ALI}. The Creditors generally support our
decision, but, in the context of assessing Pan American's viability, request us
to "require that the relevant 'closing' documents ultimately effectuating the
1 Delta has applied for exemption authority to operate the services to be transferred (not
including Detroit-London or U.S.-Spain service) in Docket 47774. That authority was orally
granted on October 7, 1991.
2 That information is due no later than October 16, 1991, with comments due within ten days of
the date the material is filed. Petitions for Reconsideration of that order were due by October
2; none were filed.
Page 4 of 65 PageID 99
reorganization be filed in this docket."3 The Creditors also suggest that we not
prohibit petitions for reconsideration of any final order, because new
regulatory issues may arise or new developments may change our
conclusions regarding Pan American's viability.4 The Creditors also argue
that we have adequate information now to approve the transfer of the
Detroit-London route to Delta.
Alaska again argues for the institution of a carrier selection proceeding to
select a new U.S. competitor in the Los Angeles-Mexico City market. It claims
that this market is now a de facto monopoly by virtue of "Pan American's
undeniable total subservience to, and control by, Delta."5 Alaska accuses us of
ignoring significant facts establishing Delta's control over Pan American.
Alaska also mentions "Pan American's quiet solicitation of bids" to purchase
this authority, and declares that spinning off this route is more urgent than
any other spin-off decision we have made.6 Alaska argues that we have
abandoned our policy announced in 1989 regarding route transfers, and
suggests that a reexamination of our recent policy is in order.
ALI's concerns involve the disposition of various of Pan American's aircraft
committed to service in the Civil Reserve Air Fleet (CRAF) program. ALI
provides two such aircraft to Pan American. ALI argues that we should not
approve the route transfers at issue here until the issue of Delta's assumption
of Pan American's CRAP obligations has been resolved. ALI has appended
the filing made by the United States in the bankruptcy court on October 1,
along with copies of assorted correspondence by ALI on the subject of Pan
American's CRAP obligations.
ALI argues essentially three substantive points in support of its position:
without resolution of the CRAF issue, the transfer is not in the public
interest; the loss of the aircraft to the program would be adverse to the
national security; and the loss of the amount at issue (more than $500
million) would have a negative budgetary effect. In addition, ALI argues that
a final order approving the transfer would interfere with the bankruptcy
proceeding, and would prejudice the United States as an unsecured creditor of
Pan American.
'""
'
Answers to the comments were filed by the Joint Applicants and by Alaska.
The Joint Applicants argue that ALI
seeks to enmesh the Department in a private matter between Pan
American and an aircraft lessor involving contract issues that are
simply not cognizable by the Department under Section 401(h) of the
Federal Aviation Act.7
After noting the continued need for prompt decision on this application, the
Joint Applicants declare that ALI's allegations are wrong, that negotiations are
in progress to resolve the CRAP issue, and that the issues the Air Force has
raised in its filing in the bankruptcy court are not within our jurisdiction
under section 401 (h).
With regard to the Los Angeles-Mexico City route, the Joint Applicants accuse
Alaska of rehashing old arguments, and argue that the route is not within the
scope of this case. Moreover, they contest Alaska's claim that Delta "is now or
will be" in control of Pan American.s The Joint Applicants present an
extended factual discussion of this issue.
Alaska emphasizes that the reorganization plans remain relevant to a
determination of this transaction's effect on Pan American's viability, and
argues that we have the legal jurisdiction to address the Los Angeles-Mexico
City issue now. Alaska claims that we should be pursuing the goal of
avoiding monopolization rather than a policy of "furthering [the
Department's] 'highest bidder take all' route sale policy and the convenience
of the principals to any such transaction."9 Alaska also suggests that the
concerns expressed by the Creditors and by ALI illustrate the uncertainties
surrounding Pan American's reorganization, and that we should examine
the Los Angeles-Mexico City issue now, partly because we may not have
another opportunity.
We find that the transfer tentatively approved in the show cause order will be
in the public interest and should be approved. As before, no party opposes
the transaction in its entirety. The two commenters that have filed pleadings
in opposition raise issues that are not even within the jurisdictional purview
of this proceeding.
..
ALI raises a more complex problem, and one that was not raised in the
context of the show cause order: essentially, whether the uncertain status of
Pan American's CRAF obligations constitutes a public interest issue
appropriate for consideration under section 401(h). While we appreciate the
importance of the CRAF program and of the issue of Pan American's
responsibilities, we do not believe that it would be appropriate to delay action
in this case until the CRAF matter has been resolved.
This issue is properly before the bankruptcy court, which is now considering
it. Our action would not intrude upon the court's prerogatives. To the
contrary, deferring action pending resolution of the CRAP problem could
amount to an implicit usurpation of the bankruptcy court's jurisdiction. If
we rule favorably on the route transfer such action in no way detracts from
the bankruptcy court's powers. If, however, we defer such action, it suggests
that we may incorporate into our section 401 (h) analysis consideration of a
matter that we regard as the domain of the bankruptcy court. Our role under
section 401(h) is to consider whether the transfer of Pan American's
international route authority will be consistent with the public interest, not to
resolve contractual disputes involving the use of a carrier's aircraft. We agree
with ALI that the CRAF program is important and that the United States'
interests should be protected, but we are confident that the bankruptcy court is
fully capable of protecting the Air Force's rights under Pan American's CRAF
contracts. Our approval of the route transfers will not limit the court's ability
to enforce the obligations of Pan American and Delta under the CRAF
program. This perspective is confirmed by the fact that the CRAF issue is in
fact now being litigated in the bankruptcy court and that the United States
Government is independently presenting its claims in that forum. 10
1
..
..
10 We have had occasion in the past to defer to other decisionmakers' authority or jurisdiction
over specific issues in the context of route transfer cases. E.g., Joint Application of United Air
Lines, Inc. and Pan American World Airways, Inc., Order 91-2-5, served February 13, 1991, at 17
(pension funding issues within purview of PBGC and bankruptcy court).
.,
We grant the application of Delta Air Lines, Inc. and Pan American
World Airways, Inc. to the extent consistent with this order;
1.
11 We do not address the Creditors' remarks regarding the Detroit-London route here, as we
made no tentative findings regarding that route in Order 919-53.
12 We are issuing Delta a new certificate to encompass all the authority transferred. We have
also amended Pan American's certificate for Route 132 to reflect the transfer, and also to
consolidate Pan American's remaining authority on its Route 133. We are amending Pan
American's certificates for Routes 133 and 218 to delete that authority in its entirety.
6
2.
We exempt Pan American World Airways, Inc. from the requirements
of section 401(a) of the Act to the extent necessary to enable Pan American to
continue service on the respective routes to be transferred, for a period of six
months from the effective date of this order, or until Delta inaugurates
service, whichever occurs earlier for each route;
3.
We issue to Delta Air Lines, Inc., a new certificate in the form attached;
4.
We reissue to Pan American World Airways its certificate for Route
132 in the form attached;
5.
We amend the certificates of Pan American World Airways, Inc. for
Routes 133 and 218 to delete that authority in its entirety;
6.
Because parties have had an opportunity to comment on our show
cause order, we will not entertain petitions for reconsideration of this order;
7.
Unless disapproved by the President of the United States under section
801(a) of the Act, this order and the attached certificates shall become effective
qn the 61st day following their submission for section 801 review, or upon the
date of receipt of advice from the President or his designee under Executive
Order 12597 and implementing regulations that he or she does not intend to
disapprove the Department's order under that section, whichever occurs
earlier;13 and
8.
We shall serve this order on all persons on the service list in this
docket, the U.S. Department of State (Office of Aviation), the Federal
Aviation Administration, and the Honorable Cornelius Blackshear, Judge for
the Bankruptcy Court for the Southern District of New York.
By:
JEFFREY N. SHANE
Assistant Secretary for Policy
and International Affairs
(SEAL)
13 This order was submitted for section 801 review on October 11, 1991.
On CJctober is, 1991 we received notification from thePresident' s designee
under Executive Order 12597 and implementing regulations that he did not
intend to disapprove the Department's. order.
..
1Expertmental <!!trtffirate
nf Jublic C!tnnuenitnrt anb Ntrts.situ
1J1nr ltnutt
616
Tbis
c~rtlfic1
tbat
~OINctlcut,_or
tbc ~crctary
On
October
rfoctivc aQ
OST F 6408
n 21851
u.
1991
October 18 2 1991
Issued by
Order
91-10-33
For Route
~l.
.'
(2)
(3)
The Netherlands;
Denmark;
Finland';
Norway;
Sweden;
Delta #616
Page 2 of 5
Egypt;
Jordan;
Lebanon;
Syria;
Iraq;
Iran;
Saudi Arabia;
The United Arab Emirates;
Kuwait;
Oman;
Bahrain;
Tel Aviv, Israel;
Afghanistan;
Pakistan; and
India;
u.s.s.R.
(4)
(5)
(6)
(7)
(8)
(9)
---
Del ta # 616
Page 3 of 5
(10) Between a point or points in the United States,
...
(2)
( 3)
(4)
A
..
'
.,
Delta # 616
Page 4 of 5
( 5)
(6 )
( 7)
(8 )
(9)
a.
Segment 1:
b.
Segment 2:
all authority;
c.
Segment 3:
d.
Segment 4:
Manchester;
e..
Segment 5 :
London;
'.
Delta # 616
Page 5 of 5
( 11) The following authority shall expire October 18, 1996.
a.
Segment 3:
b.
Segment 9:
Athens; and
c.
October
18, 1991.
~\
!
l
i
1Exerimtntal <!rertificate
nf 'ublir <t!nnutnitnce anb Necrssttu
1J1nr lloute
132
Tbis
c~rtlfi~s
tbat
or lQ'o! ~CNlary
.. - - - -
B.y DINclloQ
ll\~Ucd
by Order
OQ
Octobe-r
tUcctivc CHl
91-10-33
11. 1991
Issued by
Order 91-10-33
For Route #132
Terms, Conditions & Limitations
PAN AMERICAN WORLD AIRWAYS, INC.
(2)
(3)
(4)
( 2)
( 3 }.
,.' ~
.;.
Pan American
Page 2 of 2
(4)
(5)
(6)
(7)
(8)
---
*As Amended by
Order 91-10-33
CERTIFICATE AMENDMENTS
Pan American World Airways, Inc. for Route 133
Delete the certificate in its entirety.
..
.
DEPARTMENT OF TRANSPORTATJON
....
SERVED NOV
Joint Application of
DELTA AIR LINES, INC.
and
Docket 47675
FINAL ORDER
ER.llATUl!l*
Date:
.-
1.Exptrimtntal Q!rrtificatt
of Juhlic Q!onutnitnce anb Neressitu
lfZnr i8.oute
616
me.
ll'>~u,;:d b~ Ord~r
On
91-10-33
El'f.:~th,;: oQ
--- .
Jl&t'REY' N. SHANE
Assistant secretaxy for Policy
and IntematiOriil AffiliS
Issued by
Order 91-10-33
For Route # itl6
Terms, Conditions & Limitations
DELTA AIR LINES, INC.
is authorized to engage in foreign air transportation of persons,
property, and mail:
(1)
(2)
(3)
Del ta
#616
Page 2 of 5
Egypt;
Jordan;
Lebanon;
Syria;
Iraq;
Iran;
Saudi Arabia;
The United Arab Emirates;
Kuwait;
Oman;
Bahrain;
Tel Aviv, Israel;
Af gha.nistan;
Pakistan; and
India;
u.s.s.R.
(6)
(7)
(8)
(9)
---
Del ta # 616
Page 3 of 5
(12) Between the coterminal points New York, NY; and Boston,
MA; and the intermediate points the Azores; Lisbon,
Portugal; Madrid, Spain; Casablanca, Morocco; Dakar,
Senegal; Monrovia, Liberia; Abidjan, Ivory Coast; Accra,
Ghana; Lagos, Nigeria; Kinshasa, Republic of Zaire;
Nairobi, Kenya; and the terminal point Johannesburg,
Republic of South Africa.
(l)
(2)
(3)
(4)
Del ta # 616
Page 4 of 5
( 5)
(6)
(7)
(8)
(9)
a.
Segment 1:
b.
Segment 2:
all authority;
c.
Segment 3:
d.
Segment 4:
Manchester~
e.
Segment 5:
London;
f.
Segment 6:
Paris, and
g.
Rome~
Del ta # 616
Page 5 of s
( 11) The following authority shall expire October 18. 1996.
a.
Segment 3:
b.
Segment 9:
Athens; and
c.
1Experfmental Q!ertifiratt
of lPublir Ct!nnuenience anb Ntre.ssttu
liar i&autt
132
This
c~rttrie1
tbat
lb'
1~~u.::d
h,\' Order
J-Hl-33
or tbc ~crctar~
.. . . -
DINCtlOQ
On
Issued by
Order 91-10-33
For Route #132
Terms, Conditions & Limitations
PAN AMERICAN WORLD AIRWAYS, lNC.
is authorized to engage in foreign air transportation of persons,
property, and mail:
(1)
(2)
(3)
(4)
{2)
(3)
Pan American
Page 2 of 2
(4)
(5)
(6)
(7)
.,
"
*As Amended by
Order 91-10-33
CERTIFICATE AMENDMENTS
Pan American World Airways. Inc. for Route 133
Delete the certificate in its entirety.
Attachment 2
Order 2008-12-20
Served: December 29, 2008
Docket DOT-OST-2008-0162
Background
On April 14, 2008, Delta entered into an agreement ("Agreement") to acquire all of the
outstanding stock ofN011hwest Airlines Corporation (''NWAC"), the parent company of
No11hwest, Compass, and Mesaba, and eventually merge Northwest into Delta.
On May 15, 2008, Delta and Northwest (hereafter referred to as the "Joint Applicants")
filed the application for the Department's approval of (1) a de facto transfer of
1
For purposes of this order, reference to Northwest shall mean Northwest under the ownership of Delta, as
a result of the de facto transfer.
2
Northwest, Compass, and Mesaba's authority to Northwest, Compass, and Mesaba under
the ownership and control of Delta,2 (2) a transfer of the international route authority
currently held by Northwest to Delta upon their ultimate merger into a single entity, and
(3) route integration authority to enable Northwest and Delta to integrate their services on
the transferred routes with existing services on other international routes.
The Joint Applicants
Delta, a Delaware corporation founded in 1928 and headquartered in Atlanta, Georgia,
holds certificates of public convenience and necessity authorizing it to engage in
interstate and foreign scheduled air transportation of persons, property, and mail, as well
as vaiious certificates, exemptions, and other economic authorities from the Department
authorizing the air carrier to engage in foreign air transportation. 3 The company operates
a fleet of nearly 450 aircraft, including B-737s, B-757s, B-767s, B-777s, MD-88s, and
.MD-90s.
Northwest, a Minnesota corporation founded in 1926 and headquartered in Eagan,
Minnesota, holds certificates of public convenience and necessity to engage in interstate
and foreign scheduled air transportation of persons, property, and mail, as well as various
certificates, exemptions, and other economic authorities from the Department authorizing
the air carrier to engage in foreign air transportation. 4 The company operates a fleet of
nearly 340 aircraft, including A-319s, A-320s, A-330s, B-747s, B-757s, and DC-9s.
Compass, a Delaware corporation founded in 2006 and headquai1ered in Chantilly,
Virginia, holds a certificate of public convenience and necessity to engage in interstate
scheduled air transp011ation, 5 as well as exemption authority to serve Canada and points
in Mexico. 6 The company operates a fleet of about 30 Embraer ERJ-170-200LR aircraft.
Mesaba, a Minnesota corporation headquartered in Eagan, Minnesota, commenced
operations as a commuter air carrier in 1973. CmTently, the air carrier holds a certificate
of public convenience and necessity to engage in interstate air transportation, 7 as well as
exemption authority to serve Canada. 8 The company operates a fleet of about 100
aircraft, including CL-600s and SF-340s.
2
The Joint Applicants also filed an application (Docket DOT-OST-2008-0163) for an exemption from
section 41105 to the extent necessary to allow the acquisition of Northwest, Compass, and Mesaba to be
completed prior to our action on the de facto transfer request. By Order 2008-10-29, issued October 29,
2008, the Department granted the exemption on the condition that Delta, Northwest, Compass, and Mesaba
remain separate entities until our decision on the de facto transfer request had been made. The Joint
Applicants have advised us that the acquisition was consummated on October 29, 2008, and that Northwest
is now a wholly-owned subsidiary of Delta.
3
The Department reissued Delta's interstate scheduled certificate authority by Order 98-7-6, issued
July 8, 1998. See Attachment D for a complete list of Delta's foreign authorities.
4
The Department reissued Northwest's interstate scheduled certificate authority by Order 98-7-6, issued
July 8, 1998. See Attachment B for a complete list of Northwest's foreign authorities.
5
See Order 2008-6-17, as reissued on June 16, 2008.
6
See Attachment B for a complete list of Compass and Mesaba' s foreign authorities.
See Order 98-7-6, as reissued on July 8, 1998.
See Attachment B for a complete list of Compass and Mesaba's foreign authorities.
3
Answers and Responsive Pleadings
On June 5, 2008, the Northwest Master Executive Council of the Air Line Pilots
Association, International (''NWA ALP A") filed an answer asking the Department to
deny the Joint Applicants' certificate transfer request. 9 NWA ALPA argued that absent a
new contract with N011hwest's pilots (in the form of a joint-pilot contract covering both
air carriers' pilots), the anticipated recurring annual synergies from international code
sharing and fleet optimization would be lost, and the recurring costs due to labor friction
with Delta and Northwest's pilot groups would be increased.
On June 19, 2008, the Joint Applicants filed a reply, contending that the proposed
combination will provide substantial benefits to both Delta-No11hwest employees and
N011hwest pilots. 10 They noted that the Delta and Northwest pilot groups and Delta
management had reached a tentative agreement on substantially all of the terms of a joint
pilot agreement, subject to the Delta-Northwest pilots reaching an agreement on seniority
list integration. The Joint Applicants stated that they remain committed to continuing the
negotiating process to obtain an appropriate joint-pilot agreement. The Joint Applicants
argue that the proposed arrangement is consistent with the public interest and urge the
Department to approve the request.
On July 2, 2008, NW A ALP A filed an amended answer informing the Department that as
of June 27, the leadership of unions representing Delta and Northwest pilots had
approved the merger agreement and that ratification would be sought from Delta-ALPA
and Northwest-ALPA members.
NWA ALPA states that absent unexpected
developments, NWA ALPA no longer contends that the proposed Delta-Northwest
arrangement is contrary to the public interest.
TRANSFER OF AUTHORITY
The Department has previously determined that when two or more air carriers each
holding international route authority come under common ownership and control, a
de facto transfer of authority has taken place under section 41105 of the Statute. 11 Thus,
the Joint Applicants requested that the Department approve a de facto transfer of
Northwest, Compass, and Mesaba's authority to Northwest, Compass, and Mesaba under
the ownership and control of Delta.
Also in their application, the Joint Applicants state that upon consummation of the
acquisition of NWAC by Delta, following a transition period, N011hwest and Delta intend
to integrate their operations, employees, and route networks into a single entity using the
brand name Delta, and request that the Department transfer the international route
authority currently held by Northwest to Delta to facilitate their merger into a single
entity, and allow route integration to enable Northwest and Delta to integrate their
services on the transferred routes with existing services on other international routes so
10
11
long as they use the rights in a manner consistent with the terms of any applicable air
transport agreement. 12
A certificate may be transferred under section 41105 of the Statute if the Depmiment
determines that the transfer is in the public interest. The primary criteria in determining
the "public interest" are whether the ce1iificate transfer would conflict with important
international aviation policy objectives and whether the surviving entities are U.S.
citizens and whether they will be fit to hold the authority. Further, section 41105(b)
requires the Department to analyze the impact of the transaction on the viability of the air
carrier applicants, competition in the domestic airline industry, and the trade position of
the United States in the international air transp01tation market. 13
The Joint Applicants contend that there are no international aviation policy concerns. In
this regard, they state that the proposed mTangement will promote U.S. international
aviation policy goals by increasing the assortment of price and service options offered to
consumers between the U.S. and a variety of destinations throughout the world,
particularly to Latin America, Europe, the Middle East, Africa, and Asia. They state that
the proposal will expand access between U.S. cities and worldwide destinations and
enhance the identity and competitive strength offered by a Delta-Northwest combination,
thus promoting the role of the U.S. aviation industry in global air service markets.
The Joint Applicants assert that the merger will have a positive impact on their viability.
They note that the U.S. network airline industry continues to confront numerous financial
challenges, including unprecedented increases in fuel prices, an economic slow-down,
diminished consumer loyalty, international instability, and chronic inability to achieve
consistent profitability despite record passenger loads. The Joint Applicants also note
that they each have recently exited bankruptcy. With these issues as a backdrop, they
state that the merger is expected to produce $1.0 billion in annual synergies, providing to
the combined air carrier additional resources with which to address better these various
operational and financial challenges. The Joint Applicants assert that the Agreement will
improve the financial position of the air carriers, enabling the combined companies to
increase global air services, invest in new products and services to the benefit of the
traveling public, and enhance the air caniers' viability by filling critical gaps in Delta's
and Northwest's international route networks.
To the extent that the route transfers have any impact on domestic competition, the Joint
Applicants maintain that the Agreement will enhance domestic competition. They note
that the transaction will link 61 U.S. cities that are unique to Delta to 49 U.S. cities that
are unique to Northwest, enabling the combined air carriers to connect these 110 U.S.
cities to new destinations, benefiting consumers with alternate and more efficient
routings, improved connectivity, increased frequencies, and improved travel times. They
assert that this new domestic service landscape will produce more service opportunities,
12
So that Northwest will be able to operate Delta routes, just as Delta will be able to operate Northwest
routes following the transfer of authorities, we are amending Delta's economic authorities by changing the
name of the holder from "Delta Air Lines, fuc." to "Delta Air Lines, Inc. and/or Northwest Airlines."
13
See Order 2000-9-4 at 2.
5
and, in turn, allow the air carriers to compete more effectively for domestic passenger
traffic.
The Joint Applicants maintain that the proposed route transfer will foster U.S.-flag
competition on a worldwide basis, and in particular geographic regions, by enabling the
formation of a more effective and more expansive global U.S.-flag competitor, resulting
in an improved U.S. trade position in international air transportation markets. They note
that the Delta-Northwest combination will have a route network serving about
400 worldwide destinations, including key capitals, business centers, and tourist
destinations in Europe and Central America (where Northwest has a relatively
small/limited presence), the Middle East, Africa, and South America (where Northwest
provides no air service), and across the Pacific (where Delta has a small presence). The
Joint Applicants state that this enhanced international gateway development will provide
new options for U.S. and foreign travelers which will enable the combined air can-ier to
compete more effectively in the global marketplace.
Finally, the Joint Applicants state that they are committed to fair and equitable integration
of the labor forces and do not anticipate involuntary furloughs of front-line U.S.
employees. They maintain that the workers at Delta-Northwest will benefit by job
growth opportunities through route expansions and the air can-iers' enhanced financial
viability. The Joint Applicants state that the employees will share in the success of the
combined company with profit sharing and the opportunity to receive equity in the
combined entity. They expect that the employees will be part of a more financially
secure company, providing increased job secmity.
The Joint Applicants have offered persuasive arguments supporting the requested
transfer. The transfer will have no negative impact on the trade position of the United
States in the international air transportation market. Delta and Northwest operate
complementary domestic and international networks with minimal overlapping routes.
This combination should strengthen Delta's ability to offer new international non-stop
flights that neither it nor Northwest could support individually.
Despite the transfer of international economic authority from Northwest to Delta, the
U.S. domestic market will remain highly competitive. Moreover, Northwest's cun-ent
operations will be integrated into Delta's existing operations, linking 61 U.S. cities that
are unique to Delta to 49 U.S. cities that are unique to Northwest. Further, the viability
of both air can-iers will be enhanced as a result of the merger. The merger is expected to
produce approximately $1. 0 billion in annual synergies, which will allow the combined
air caiTier the ability to face numerous financial challenges.
Our review of the Joint Applicants' pleadings and other data available to the Department
raises no issues that would lead us to question the fitness or citizenship of Delta,
Northwest, Compass, and Mesaba as a result of this transaction. 14 Therefore, we find that
a de facto transfer of certificate and other international route authorities held by
14
The Department recently concluded continuing fitness reviews of the Joint Applicants and found that
each remained fit to conduct operations as U.S. certificated air carriers.
6
N01ihwest, Compass, and Mesaba to Northwest, Compass and Mesaba under the
common ownership of Delta, as well as a transfer of the certificates and international
authorities held by Northwest to Delta and/or Northwest, is in the public interest and does
not conflict with our international aviation policy objectives. 15
To facilitate the operational integration of Northwest and Delta, the Depaiiment intends
to amend all certificates and authorities held by both Northwest and Delta by changing
the name of the authority holder to "Delta Air Lines, Inc. and/or Northwest Airlines, Inc."
We note, however, that only one air carrier, either Delta or Northwest, but not both of
them, may operate or be designated to operate over a route or route segment where the
terms of an air transport agreement limit U.S. air cmTier entry on that route or route
segment to one air carrier or the other.
ROUTE INTEGRATION
We will grant the Joint Applicants' request to integrate their international authority. We
find that approval of this request is in the public interest as it will provide the air cmTiers
with maximum operating flexibility and will facilitate the ability of the air carriers to
implement the transferred authorities. As is our standard practice, the route integration
authority granted is subject to the provisions of the aviation agreements between the
United States and the foreign countries involved, and to our standard conditions
regarding route integration in limited-entry markets.
ACCORDINGLY:
1) We grant the request of Delta Air Lines, Inc., Northwest Airlines, Inc., Compass
Airlines, Inc., and Mesaba Aviation, Inc., for approval under 49 U.S.C. 41105 of
the de facto transfer of the certificates and other economic authorities held by
Northwest Airlines, Inc., Compass Airlines, Inc., and Mesaba Aviation, Inc., to
Northwest Airlines, Inc., Compass Airlines, Inc., and Mesaba Aviation, Inc., under
the ownership of Delta Air Lines, Inc.
2) We transfer to Delta Air Lines, Inc. and/or Northwest Airlines, Inc., the interstate and
foreign air transportation certificates currently held by Northwest Airlines, Inc., and
amend them, in the form attached (Attachment A), by changing the name of the
holder from "Northwest Airlines, Inc.," to "Delta Air Lines, Inc. and/or Northwest
Airlines, Inc." We transfer the exemption authority and frequency allocations listed in
Attachment B from Northwest Airlines, Inc., to Delta Air Lines, Inc. and/or
Northwest Airlines, Inc.
15
The de facto transfer of a foreign air transportation certificate is subject to Presidential review under
49 u.s.c. 41307.
3) We amend the interstate and foreign air transportation certificates cmTently held by
Delta Air Lines, Inc., in the f01m attached (Attachment C), by changing the name of
the holder from "Delta Air Lines, Inc.," to "Delta Air Lines, Inc. and/or Northwest
Airlines, Inc." We transfer the exemption authority and frequency allocations listed
in Attachment D from Delta Airlines, Inc., to Delta Air Lines, Inc. and/or Northwest
Airlines, Inc.
4) Under the terms of the blanket route integration certificate authority held by Delta Air
Lines, Inc., and/or Northwest Airlines, Inc., in accordance with paragraphs 2 and 3,
above, the carriers may integrate their certificate and exemption authority. The route
integration authority granted is subject to the condition that all such integrated
operations are in compliance with the provisions of all applicable aviation
agreements, and provided further, that (a) nothing in the award of the route
integration authority granted should be construed as conferring upon Delta Air Lines,
Inc. and/or Northwest Airlines, Inc., additional rights (including fifth-freedom
intermediate and/or beyond rights) to serve markets where U.S. air cmTier entry is
limited unless Delta Air Lines, Inc. and/or Northwest Airlines, Inc. first notifies the
Department of its intent to serve such a market and unless and until the Department
has completed any necessmy air carrier selection procedures to determine which air
carrier(s) should be authorized to exercise such rights; and (b) should there be a
request by any air carrier to use the limited-entry route rights that are included in this
authority by virtue of the route integration authority granted here, but which are not
being used, the holding of such authority by route integration will not be constrned as
providing any preference for Delta Air Lines, Inc. and/or Northwest Airlines, Inc., in
a competitive air carrier selection proceeding to determine which carrier( s) should be
entitled to use the authority at issue.
5) The authority granted may only be used in a manner consistent with the terms of the
air transport agreements between the United States and our aviation partners.
6) Unless disapproved by the President of the United States under section 41307 of the
Statute, this order shall become effective on the 6lst day after its submission for
section 41307 review or upon the date of receipt of advice from the President or his
designee under Executive Order 12597 and implementing regulations that he or she
does not intend to disapprove the Department's order under that section, whichever
16
occurs earlier.
16
This order was submitted for section 41307 review on [insert date]. The 6lst day is [insert date].
8
7)
By:
SUSAN MCDERMOTT
Deputy Assistant Secretary
for A via ti on and International Affairs
Attachment A
*As amended by
Order 2008-12-:XX
Page 1 of 1
This certificate amendment shall become effective [upon notification from the White
House].
17
The subject certificates are being amended to reflect the Department's approval, under 49 U.S.C.
41105, of the de facto transfer of the economic authorities held by Northwest to Delta. To facilitate a
smooth transition of the integrated services and to provide for maximum operational flexibility during this
time, the certificates will read, "Delta Air Lines, Inc., and/or Northwest Airlines, Inc." Additional
condition(s) may apply to certain of these certificates, as indicated.
A.
Route#
3F
86F
129
Order(s)
2006-1-1
80-9-106
74-10-75
81-12-160
82-8-19
87-10-13
86-9-20
92-3-41
96-9-17
140
179
378
Guangzhou,
Beijing;
90-6-44
92-3-38
98-6-22
74-10-75
83-3-40
83-7-68
85-1-1
86-11-1
95-4-41
99-2-8
2007-12-26
Route#
Route Description
Order(s)
564
2001-4-15
604
662
668
811
814
828
837
Honolulu-Sydney
U.S.-Canada
U.S.-Netherlands-Kiev, Ukraine
U.S.-France open-skies
U.S.-ltalv and U.S.-Portuqal open-skies
U.S.-China (all-carqo)
Blanket open-skies
91-4-3
95-6-26
2000-8-19
2002-5-25
2002-7-31
2005-3-40
2007-4-19
3
B. Exemptions (note
Route Description
Order/NOAT (Docket)
Detroit-Punta Cana
Attachment B
Route Description
Order/NOAT (Docket)
Attachment B
C. Frequency Allocations
Weekly
Freq.
9
Route(s)
Order/NOAT (Docket)
U.S.-China Combination
U.S.-China All-Cargo
U.S.-China All-Cargo
U.S.-China All-Cargo
U.S.-China All-Cargo
14
U.S.-Philippines Combination
0.5
56
21
95
6
Weekly
Freq.
3
Attachment B
Route(s)
Order/NOAT (Docket)
21
7
6
Air France,
Alitalia,
CSA
Czech,
Regional,
Brit Air,
CityJet
KLM
Cityhopper
Korean Air
Aeroflot
JAL
Air China
Kenya
Airways
Description
Order/NOAT/DOT Action
(Docket)
NOAT, Last amended
1/11/05, OST-2003-15191
7
Airline
Partner(s)
Malev
Malaysia
E.
Operating
Carrier
ExpressJet
Airlines,
Inc. d/b/a
Continental
Express
ExpressJet
Airlines,
Inc. d/b/a
Continental
Express
ExpressJet
Airlines,
Inc. d/b/a
Continental
Express
ExpressJet
Airlines,
Inc. d/b/a
Continental
Express
ExpressJet
Airlines,
Inc. d/b/a
Continental
Express
ExpressJet
Airlines,
Inc. d/b/a
Continental
Express
Description
Exemption authority and statement of authorization to
permit NW/Malev codeshare service (U.S.HunQarv-bevond)
Blanket statements of authorization to permit
reciprocal NW/Malaysia codesharing
Order/NOAT/DOT Action
(Docket)
NOAT, Last amended
7/3/02, OST-2001-11173
NOAT, 8/24/00, OST2000-6792
3/24/2004
11/12/2003
Houston-Manzanilla
5/27/2003
Houston-Morelia
8/12/2003
Houston-Oaxaca
Houston-Toluca
Houston-Villahermosa
Houston-Durango
6/17/2004
8
Operating
Carrier
ExpressJet
Airlines,
Inc.
F.
Airline
Partner(s)
KLM
Air France,
Alitalia,
Czech,
Delta, KLM
II.
Route
Houston-Acapulco
Houston-Puerto Vallarta
Houston-San Jose del Cabo
Houston-Mexico City
Houston-Veracruz
93-1-11
2008-5-32
Route Description
U.S.-Canada Open Skies Exemption
Detroit-Monterrey, Mexico Exemption
Blanket statement of authorization for Compass to
display the KL code between points in the U.S.
and between points in the U.S. and points in
third countries
III.
Order/Notice of Action
Taken (NOAT)
NOAT, 8/6/07, OST-200728132
NOAT, 10/22/07, OST2007-29323
NOAT, 7/10/08, OST2003-15191
Route Description
U.S.-Canada Open Skies Exemption
Order/Notice of Action
Taken (NOAT)
NOAT, 8/6/07, OST-200728092
*As amended by
Order 2008-12-XX
Page 1of1
( ) The authority granted may only be used in a manner consistent with the te1ms of the
air transport agreements between the United States and our aviation partners.
This certificate amendment shall become effective [upon notification from the White
House].
18
The subject certificates are being amended to reflect the Department's approval, under 49 U.S.C.
41105, of the de facto transfer of the economic authorities held by Northwest to Delta. To facilitate a
smooth transition of the integrated services and to provide for maximum operational flexibility during this
time, the certificates will read, "Delta Air Lines, Inc., and/or Northwest Airlines, Inc." Additional
condition(s) may apply to certain of these certificates, as indicated.
Route#
616
798
2006-1-1
Portland/Detroit/Houston/Philadelphia/New York-Newark/
Boston-Afghanistan
Atlanta-Buenos Aires, Argentina
91-10-33
95-3-25
2001-1-14
2000-12-13
85-2-19
79-8-68
72-8-1
152
Boston/New York-Newark/Detroit/Atlanta/Memphis-Dallas-Ft.
Worth/Tampa-St. Petersburg-Clearwater/Ft. Lauderdale/MiamiFreeport/George Town/Great Harbor City/Marsh
Harbor/Nassau/Rock Sound/Treasure Cay/West End, Bahama
Islands
U.S.-Bahama Islands
152
U.S.-Barbados
167
740
751
875
796
U.S.-Cayman Islands
Atlanta-Shanghai, China
Atlanta/New York-Bogota, Colombia
616
616
158
114
152
616
616
810
810
810
810
Order(s)
U.S.-Egypt
Portland/Detroit/Houston/Philadelphia/New York-Newark/BostonEgypt
U.S.-French Departments of America (French Guiana)
U.S.-French Polynesia
U.S.-New Caledonia/Wallis/Futuna
U.S.- French Departments of America (Guadeloupe)
95-5-20
90-9-13
88-8-57
95-5-20
90-9-13
88-8-57
80-7-97
78-12-192
72-8-1
97-4-13
2002-7-31
97-2338
NOAT 12/23/05
98-4-3
2007-9-25
2000-9-21
2008-5-27
91-10-33
91-10-33
80-4-23
78-7-104
95-5-20
90-9-13
88-8-57
91-10-33
2002-5-25
2002-5-25
2002-5-25
2002-5-25
Route Description
Route#
U.S.-Haiti
152
U.S.-Hong Kong
152
616
616
Portland/Detroit/Houston/Philadelphia/New York-Newark/BostonIran
Portland/Detroit/Houston/Philadelphia/New York-Newark/BostonIraq
616
616
616
754
586
Portland-Nagoya, Japan
585
616
616
616
810
562
562
562
562
562
562
562
562
562
562
562
630
810
616
616
616
616
616
Attachment D
Order(s)
92-5-20
90-9-13
88-8-57
99-2-8
92-5-20
90-9-13
88-8-57
91-10-33
95-3-25
91-10-33
95-3-25
91-10-33
95-3-25
91-10-33
91-10-33
91-10-33
98-5-17
96-5-9
90-10-15
NOAT 9/29/00
2001-12-8
96-5-9
90-10-15
91-10-33
95-3-25
91-10-33
2002-5-25
2000-5-31
2000-5-31
2000-5-31
2000-5-31
2000-5-31
2000-5-31
2000-5-31
2000-5-31
2000-5-31
2000-5-31
2000-5-31
95-5-20
2002-5-25
91-10-33
95-3-25
91-10-33
95-3-25
91-10-33
91-10-33
95-3-25
91-10-33
Route#
Route Description
616
152
667
757
840
B. Exemptions (note
Order(s)
91-10-33
95-3-25
92-5-20
90-9-13
88-8-57
95-7-36
99-2-8
2007-4-27
Route Description
Blanket third-country code-share authority
Atlanta-Luanda, Anqola
Atlanta-Antigua, Antigua & Barbuda
New York-Buenos Aires, Argentina
U.S.-Belize
U.S.-Manaus/Fortaleza/Belo/ Horizonte/Recife, Brazil
Los Anqeles- Sao Paulo, Brazil
Atlanta-Quito/Guayaquil, Ecuador
Atlanta-Malabo, Equatorial Guinea
U.S.-Guyana
Salt Lake City-Mazatlan, Mexico
Salt Lake City-Puerto Vallarta, Mexico
Cincinnati-Cancun, Mexico
Ontario-Guadalajara, Mexico
Atlanta-San Jose del Cabo, Mexico
Chicaqo-Mexico City/Toluca, Mexico
Los Anqeles-Cancun, Mexico
Atlanta-Cozumel, Mexico
San Diego-Mexico City/Toluca, Mexico
Los Anqeles-Acaoulco, Mexico
Detroit-Mexico City, Mexico
Detroit-Monterrey, Mexico
Nashville-Cancun, Mexico
Raleiqh-Cancun, Mexico
Orlando-Cancun, Mexico
Hartford-Cancun, Mexico
Salt Lake City-Guadalajara, Mexico
Atlanta-Puerto Vallarta, Mexico
Order/NOAT (Docket)
NOAT 1/24/07, DOT-OST-2005-20145
NOAT 11/19/08, DOT-OST-2008-0353
NOATs 10/22/07; 8/31/05, DOT-OST1997-3051
NOAT 6/17/08, DOT-OST-2008-0185
NOATs 10/22/2007; 8/31/05; 6/18/04;
4/17/03; 9/25/02, DOT-OST-1999-5749
NOAT8/8/08, DOT-OST-2008-0227
Order 2008-11-21 , DOT-OST-20080307
NOATs 2/7/06; 218108, DOT-OST-200623526
NOAT 11/19/08, DOT-OST-2008-0353
NOAT 2/7/08, DOT-OST-2008-0045
NOAT 7/27/07, DOT-OST-2005-21724
NOAT 7/27/07, DOT-OST-2005-21075
NOAT 7/27/07, DOT-OST-2001-10457
NOAT 7/27/07, DOT-OST-2000-8270
NOAT 7/27/07, DOT-OST-2000-7390
NOAT 7/27/07, DOT-OST-2000-6816
NOAT 7/27/07, DOT-OST-2005-22415
NOAT 8/9/06 (renewal filed 3/26/08),
DOT-OST-2004-19231
Order 2002-5-31 {filed dormancy letter
10/27108), DOT-OST- 2005-21353
NOAT 6/15/06 (renewal filed 3/26/08),
DOT-OST-2006-25065
NOAT 10/30/08, DOT-OST-2008-0312
NOAT 10/30/08, DOT-OST-2008-0312
NOAT 8/5/08, DOT-OST-2008-0232
NOAT 8/21/07, DOT-OST-2007-28948
NOAT 8/21/07, DOT-OST-2007-28948
NOAT 8/21/07, DOT-OST-2007-28948
NOAT 9/1/06 (renewal filed 3/26/08),
DOT-OST-2006-25495
NOAT 7/27/07, DOT-OST-2005-22025
Order/NOAT (Docket)
NOAT 7/27/06 (renewal filed 3/26/08),
DOT-OST-2006-25433
NOAT 7/27/07, DOT-OST-2005-22243
Order 2006-9-8, DOT-OST-2005-23497
NOAT 8/9/06 (renewal filed 3/25/06),
DOT-OST-2003-14290
NOAT 8/9/06 (renewal filed 3/25/06),
DOT-OST-2004-18878
NOAT 8/9/06 (renewal filed 3/25/06),
DOT-OST-2004-18184
NOAT 7/27/07, DOT-OST-2005-22620
NOAT 7/27 /07, DOT-OST-2005-22620
NOAT 7/27/07, DOT-OST-2005-22620
NOAT 10/30/08, DOT-OST-2008-0312
DOT-OST-2006-25433
NOAT 10/16/07, DOT-OST-2007-29356
NOAT 11/14/02, DOT-OST-200213298; DOT-OST-1999-6246
NOAT 10/22/07, DOT-OST-1997-3051
NOAT 6/5/00, DOT-OST-2000-7389
C. Frequency Allocations
Weekly
Freq.
7
5
Route(s)
Atlanta-Buenos Aires, Argentina
New York-Buenos Aires, Argentina
Atlanta/New York- Sao Paulo-Rio de Janeiro, Brazil
21
12
7
7
7
8
7
95
21
3
7
U.S.-Brazil
Atlanta-Shanghai, China
Atlanta-Bogota, Colombia
New York (JFK)-Bogota, Colombia
Atlanta-Quito/Guayaquil, Ecuador
Atlanta-Tokyo, Japan
United States - Japan same country code share
Beyond Japan blind sector same country code share
United States - Japan same country code share
New York(JFK)-Tokyo, Japan
Order/NOAT (Docket)
Order 2001-01-14, DOT-OST1999-6210
NOAT 6/17/08, DOT-OST-20080185
NOAT 12/23/05, Orders 97-4-13,
2000-12-2, 2004-6-25, 2005-413, DOT-OST-1997-2338
NOAT 8/8/08; Order 2008-11-21;
Docket DOT-OST-2008-0227
NOAT 6/18/08, Order 2007-9-25,
DOT-OST-200 7-28567
Order 2000-9-21, DOT-OST2000-7655
Order 2008-5-27, DOT-OST2007-0006
NOATs 2/7/06, 2/8/08, 7128108,
DOT-OST-2006-23526
Order 98-5-17, DOT-OST-19983419
NOAT 7/17/08, DOT-OST-20080212
NOAT 7/17/08, DOT-OST-20080212
NOAT 11/20/08, DOT-OST-20080354
NOAT 11 /20/08, DOT-OST-20080354
Weekly
Freq.
7
Atlanta-Moscow, Russia
New York (JFK)-Moscow, Russia
7
4
7
3.5
Order/NOAT (Docket)
NOAT 2/8/05, DOT-OST-200520116
Orders 96-10-1, 97-7-33, 97-912, DOT-OST-1996-1672, DOTOST-1997-2790
NOATs 10/16/07, 1/29/08,
11/19/08, DOT-OST-2007-29356
NOAT 2/27/06, DOT-OST-200623924
NOAT 8/6/02
Order 2006-1-12, Dockets DOTOST-05-22450, DOT-OST-0522195
Attachment 3
1
RENEW & AMEND
U.S. Department of
Transportation
Office of the secretary
nt fmn.<;nC'll'lnOOn
This serves as interim notice to the public of the action described below, taken orally by the Depanment
official indicated,- the confinning order or other decision document will be issued as soon as possible.
Application of
filed
for:
Applicant rep.:
DISPOSmON
Except to the extent exempted or waived, this authority is subject to the tenns, conditions, and limitations
indicated:
XX Holder's certificate of public convenience and necessity
XX Standard Exemption Conditions (attached)
(See Reverse Side)
-2-
Conditions: The route integration authority granted is subject to the condition that any service provided
under this exemption shall be consistent with all applicable agreements between the United States and the
foreign countries involved. Furthermore, (a) nothing in award of the route integration authority
requested should be construed as conferring upon Delta rights (including fifth freedom intermediate
and/or beyond rights) to serve markets where U.S. carrier entry is limited unless Delta notifies us of its
intent to serve such a market and unless and until the Department has completed any necessary carrier
selection procedures to determine which carrier(s) should be authorized to exercise such rights; and (b)
should there be a request by any carrier to use the limited entry route rights that ace included in Delta's
authority by virtue of the route integration exemption granted here, but that are not then being used by
Delta, the holding of such authority by route integration will not be considered as providing any
preference for Delta in a competitive carrier selection proceeding to determine which carrier(s) should be
entitled to use the authority at issue.
Attachment 4
BEFORE THE
DEPARTMENT OF TRANSPORTATION
WASHINGTON, D.C.
Application of
DELTA AIR LINES, INC.
)
)
Docket OST-97-2338
)
)
~(R~ou_t_e_I_n_te~gr_a_t_io_n~>~~~~~~~~>
D. Scott Yohe
Senior Vice President Government Affairs
DELTA AIR LINES, INC.
1275 K Street, N.W.
Washington, D. C. 20005
(202) 216-0700
Robert E. Cohn
Alexander Van der Bellen
SHAW PITTMAN LLP
2300 N Street, N. W.
Washington, D.C. 20037
(202) 663-8060
Counsel for
DELTA AIR LINES, INC.
John Varley
Vice President Associate General Counsel
DELTA AIR LINES, INC.
Law Department #981
1030 Delta Boulevard
Atlanta, Georgia 30320
(404) 715-2872
February 9, 2005
BEFORE THE
DEPARTMENT OF TRANSPORTATION
WASHINGTON, D.C.
February 9, 2005
Application of
DELTA AIR LINES, INC.
)
)
Docket OST-97-2338
)
)
_(R~ou_t_e_l_n_te~gr~a_ti_on~>~~~~~~~~~>
Robert E. Cohn
Alexander Van der Bellen
SHAW PITTMAN LLP
2300 N Street, N. W
Washington, D.C. 20037
(202) 663-8060
Counsel for
DELTA AIR LINES, INC.
CERTIFICATE OF SERVICE
9th
Susan Testa
Attachment 5
XX Allocation of 7 weekly frequencies to operate scheduled combination service between Atlanta and
.Johannesburg, South Africa, via Dakar, Senegal. 1
Under the U.S.-South Africa aviation agreement, U.S. carriers may operate 21 weekly scheduled combination service
frequencies. Currently, all of the 21 frequencies are available for allocation by the Department. Delta seeks 7 weekly
frequencies to operate daily service between Atlanta and Johannesburg, South Africa, via Dakar, Senegal with local
traffic rights along the route, beginning on or about December 4, 2006.
No answers to the application were filed.
Applicant rep: Alexander Van der Bellen (202) 637-4999
DISPOSITION
XX Granted, subject to conditions (see below).
Tile above action was effective when taken: Februarv 27. 2006, and will remain in effect indefinitely.
------------------Conditions: If Delta does not begin service with all the allocated frequencies by December 14, 2006, each unused
frequency will automatically revert to the Department for reallocation. 2 Consistent with our standard practice, the
frequency allocation granted is subject to the condition that if any of the frequencies (once inaugurated) is not used for
1
Delta holds existing certificate authority to serve Dakar and Johannesburg from Boston and New York under Route 616, Segment
12 (see Order 91-10-33). In its application, Delta provides notice of its intent to rely on route integration authority to provide
:;crvice from the Atlanta gatcw~1y. Under the terms of Delta s route intcgration excmption (sec Notice of Action Takcn datcd April
24, 2003. in Dm:kct OST-97-233;-l, AP!\ renewal pcnding), Delta is requircd to notify the Department of its intcnt to rely on route
integration authority prior to bcginning new services in limited-entry markets.
2
Whilc Delta state,; that it will bcgin service on or about Decemher 4, 2006. we will extend the startup dare slightly beyond that
date to provide a reasonable opportunity for full introduction of the new service propo,;ed without the risk of losing frequencies.
Should Delta need an extension beyond Dct:ernbcr 14, 2006, it will need to request such <111 exten.-;ion formally.
a period of90 days, the allocation with respect to that frequency will expire automatically and the frequency will revert
to the Department for reallocation.
Under authority assigned by the Department in its regulations, l 4 CrR Part 385, we found that (I) our action was
consistent with Department policy; (2) grant of the authority was consistent with the public interest; and (3) grant of
the authority would not constitute a major regulatory action under the Energy Policy and Conservation Act of l 975.
To the extent not granted or dismissed, we denied all requests in the referenced Docket. We may amend, rnodity, or
revoke the authority granted in this Notice at any time without hearing at our discretion.
Persons entitled to petition the Department for review of the action set forth in this Notice under the Department's
regulations, 14 CFR ~ 385.30, may file their petitions within seven (7) days after the date of issuance of this Notice.
This action was effective when taken, and the filing of a petition for review will not alter such effectiveness.