level of dominance at any capacity limited airport the department of justice has recognized the significance significant about its concerns raised by that merger and the dominance that united has required united to cede flight slots at newark to a low cost carrier southwest but in twenty one thousand dollars southwest announced that it was ceasing service to newark d o j and spirit requested that the f a a reallocate a block of sixteen peak authorizations to another low cost carrier to preserve competition at the airport but in an effort to solidify it monopoly united argued that the authorization should be retired and the decision that's under review here the f a a sided with united and announced that it would not reallocates southwest's keep authorizations even now when there is no congestion at airports and no reason to limit a regime that continues to favor united as recently as last week the f a a reaffirms that spirit is not entitled to priority for peak authorizations in future seasons and that united can effectively block spirit from obtaining priority by continuing to operate flights during those periods by failing to take the competitive concerns into account and ignoring comments from experts stakeholders like the d o j and the port authority of new york or new jersey the f a a acted arbitrarily and capriciously this and if we conclude that it's not final agency action because it doesn't have binding legal would that mean that you don't have standing i think not necessarily obviously there's a difference between kind of the practical consequences that a decision can have a binding legal effect and where decision has practical consequences but not legal consequences there can still be an injury and still be standing but not necessarily be a final if i don't agency action here i'm out of the heart of everything we think we are both  and so let's talk about with anality part if we could what are the chances that the f a a will take newark to a level three status i think if the airport is operating at its peak capacity and if the delays continue to be what they are here then the f a a has indicated that if if there's a continual if an airline continues to fly without authorizations at it at a time when when the flights are at or above their peak then it will be it will be looking to make the transition and that's not an idle threat this is something that has happened before at newark airport  correctly and tell me if i'm wrong if conditions after the pandemic returns to the conditions before the pandemic and if spirit started flying the sixteen peaks plots that been you think it's almost certain that the f a a would take newark to a level three status we think that that's what the f a a has indicated it would do and that's backed up by by the language that in the notices itself and by the language that then the  world wide swap by lines again that when when airlines are operating above capacity and there's not a chance of kind of the voluntary negotiations that the f a a has referred to and voluntary adjustment on their own that that will lead to the transition to level three what do i do with the language i mean mining which is a fairly recent d c circuit to me and it's that is but while regulated parties may feel pressured to voluntarily conform their behavior because the writing is on the wall about what will be needed to obtain arms in no order in the regularly an entity to do anything and therefore no denial of priority that's happening immediately so even even now spirit by not having the authorizations for futures isn't is denied priority for for scheduling in future seasons today and that is  particularly important for planning purposes because the authorizations themselves aren't finalized until very near the time that the scheduling season act weekends of course airline tickets on the other hand are sold sometimes nearly a year and ends and the reason that that's even possible is because the airlines can rely on priority that they've received based on their previous schedule which guarantees them those authorizations in these in these future seasons even in the event of a transition to level three and so spirit is not being entitled or not permitted to have that priority even now and so that is i think one of the one of the consequences of this decision even if you're not sure if or when you know the transition to level three will happen it's this kind of safe harbor that spirit is being denied in the supreme court has held in cases like  the u s army corps of engineer versus hawks from two thousand and sixteen that that kind of a safe harbor or that's nial of that safe harbor is sufficient sufficiently good consequence for a final agency action yes one more question then i'll get out of your way and out of my colleagues way during the pandemic i'm going to guess that newark is not having any flights as they used to if you just started flying a bunch of those sixteen peak scenario you don't want to have happen happens new york gets taken to a level three and it becomes illegal for you to continue to apply those slots when you have made money in the meantime or is the amount of money necessary as an initial investment to do those sixteen slots greater than what you will be able to make you mean in the  and all that's required and it has to start these these ad hoc flights without kind of the guarantee of future priority is significant and that is what keeps it from from operating these flights in normal circumstances so that is the kind of like painful choice between compliance and the risk of prosecution in the future that's that the court is referred to in c s i aviation as a final agency action i do think that co good has has altered things and has altered the calculus for spirit because there is really very limited potential for the return of these flights very soon and so because of that spirit has taken the step of operating author operating flights ad hoc temporary flights during times that would previously be unset or peak hours but of course they are not they're not peak hours now because no one is no one is flying but the way that the f a a has addressed kovac in this situation is just kind of highlighted the way that it continues to favor the incumbent airlines like but like united  here the f a a has allowed these incumbent airlines to maintain their authorizations and the accompanying priority for future seat seasons even when they're not actually operating the flights while the f a a has declined to issue new authorizations to airlines like spirit who are willing and able to fly even though they are aware that the flights are nowhere near their operating caps so even while spirit is flying now and united isn't united is maintaining that priority for future seasons and spirit is not and last week's notice that was there was a notice that was just published in the federal register yesterday it suggests that the f a a is planning to continue that policy at least through december of this year and that starting in january the airlines will have to operate to get priority moving forward but they only have to give notice a month prior and so can can if if at that point the authorizations will be at their their limit again they can essentially force spirit out for spirit to make that same same calculus that we were referring to earlier about whether the economics are worthwhile for it to risk kind of the forstmann and the cancellation of the flights but it's not just i want to also say it's not just the cancellation of the flights  and you know the cost of the infrastructure and the gate that it stands to lose if it's forced to cancel flights on a quick time spirit because of its limited presence at newark and it's limited ability to obtain authorizations there is also unable to rebook the passengers that it's booked on those flights and so it loses out there as well so i think that's that's another another problem  do more than nod to the concerns raised by comp mentors willing to dismiss them and they failed to do that here the comments that were raised as well as the congressional policy in favor of competition require the agency to consider the competitive  decision was going to have here and it failed to do so the agency is kind of gesture towards concerns with congestion and the need to study that but the record is very clear that any competitive that there's going to be significant competitive united to prevent it from gaining additional slots from delta southwest's apart sure leaves united with eighty one percent of the peak afternoon hours seventy three percent of all of new york's flights it gives united five additional monopoly routes in addition to the eighty one dollars that it already has spirit if it were allowed to operate during these these peak hours could add flights to four of those monopoly routes and it means the loss of a one million low cost tickets per year on the other hand you have the congestion and the data and the record here shows that retiring southwest authorization will only reduce congestion by one two percent and  congress were if if the f a a were actually concerned with congestion the proper thing to do here would be to use the congressionally approved back in ism and that is the schedule reduction meeting which it's done it in the past and use that perhaps to shift the flights from the two o'clock pm hour he has tried to kind of frame its decision as the middle ground preservation of the status quo but it's neither of those things it doesn't actually doesn't preserve the status quo for competition so united the f a a had to choose between preserving status quo for competition and recognized the value of competition particularly from a low cost carrier at at an airport like newark with a dominant monopolist and that was a decision that needed to be or that was a factor that needed to be taken into account here  thank you your honor may have please the court benjamin schultz on behalf of the secretary of transportation and the administrator of the f a a the agency action that is being challenged in this case is not a final agency action it was a notice that the f a a published in fall twenty one thousand telling the airlines how it expected to run the level to schedule facilitation process for the upcoming summer two thousand and twenty season that notice was not final agency action for two different reasons the  st was that it lacked legal effect in the nd was that even if you thought that f a a is approvals of particular routes had legal a factor approvals of particular time periods had legal effect the notice was not the culmination of  processed because all that the notice did was a told the airlines how it was going to go through its facilitation process but then it was incumbent on the airlines to submit their proposed schedules and actually go through that process and go through the press process of negotiation  facilitation when is only one step process ended that the airlines would know which schedules were approved and which ones were not i don't be happy to talk more about the final agency action if the court has questions about it and i do want to in particular airports so whatever the nature of the the letter there it has this limiting of facts that seems to be quite a now the french letter and security point respectfully honored there's a couple problems with that two very significant ones the st is that in security point the action in fact had legal effect what it was is there were binding agreements and if the agency had modified those agreements then there would have been a change in the legal relationship so when the agency refused to modify those agreements it was choosing one legal regime over another there was binding legal effect that's not the case here because here even if you thought that the f a a is approvals how even if you thought that the f a a is decision making said something about approvals those approvals still don't have legal effect in a good way to think about this is another one of these court cases which case that we cite is the joshi versus n t s b case and that's a case where joshi asked the n t s b to reconsider something and the agency refused to reconsider a published report that had issued and it it's the case that the agency was definitively saying look we're not modifying our report that's going to just be the report and there's nothing you can do about it mr joshi but it was still held to be not final agency action because the underlying report didn't have a legal effect and so that's what's going on here is approvals state the f a a is used it's the f a a saying these are the flights that we think should go forward but if spirit wants to go ahead and operate those flights without f a a approval it is legally free to do so the other problem though with your honor's  reliance on the security point case is that even if you thought that it was the approval process that had some sort of legal effect that only as part of the finality inquiry the other half is whether or not this is the consummation of the agency's decision and it's respect your honor that's actually not what it says it's saying that if the agency all timid lee concludes that it needs to go to level three at some point in the future it expects that at that indeterminate future point at which it prospected le goes to a level three airport then it is that point it expects at the approved flights would have priority over the unapproved flights now that's a really important thing to understand because we were not here saying that if it's some point in the future the f a a goes to level three and spirit wants to get a slot and spirit doesn't get that slot in the level regime level three we're not saying that spirit can't point seat judicial review a slots regime would have legal effect what we are saying is that in the level two regime where all that f a a is doing is this voluntary facilitation process where it's telling people ok these are the flights that we think are good those are the flights that we would rather that you didn't fly because those decisions don't have legal effect and spirit is still free to fly right now reports had significant practical consequences but nonetheless because it was just a report and it didn't have legal consequences it was held not to be final agency action that's just one of many cases you know there are plenty of cases about agency advice letters there are cases i'm for example i think there's the california case about the e p a where the e p a had said that something was decided and then it reopened it and there was significant doubt as to whether that old decision was going to stand in the states we're going to have to do all these changes to their plans so everybody agreed that there were significant practical consequences but it was nonetheless held to be not final agency action are you great but isn't it isn't that what you're saying it's a distinction between practical  consequence the way that it was understood was that it was a leak the way least this court said that it understood the legal regime was that it was a legally illegal bar on those people buying the products it was not just that you know they felt that there were practical problems it was that  in safe extensions at least as i read the opinion the court understood it that it was in fact a legal bar but but even if this court has a different reading i still want to make a distinction that there are some situations where this court has had a slightly different understanding a finale in situations where the regulated party is put to that the situation where it might have to face prosecution  that's like for example the epson case that's not even what we have here if spirit operates these unapproved flights it's not like if spirit thinks that it's ok and then the f a a says no actually we don't like what you're doing that spirit faces some sort of fine or civil enforcement action for anything it did in the past all that happens is something most all that happens is something prospective f a a would say wow there's really a lot of congestion here so prospected least we're going to make this change in the legal regime but everything that you did up trail that you just now you telling me that isn't legal as opposed to just your only practice that is how i read this court's understanding of the legal regime and see if extensions it's i suppose i as they could lawfully by the whites i just couldn't use them well if that's still it i think if you're on i want to make that distinction it's still a legal effect in the sense that the use would be prohibited here no one saying that empty airplane a spirit says we're going to fly this then they can sell those tickets people can board those flights those flights can take off and they will have obligated contract obligations to refund  the the relevant periods need to submit their schedules in advance and if you look at the very next sentence that follows the sentence that your honor quoted they make clear that this is indeed a voluntary regime because it's clear that the only thing that happens if an airline you are i think if you want to look at more evidence of what was going on here you can also look at the other notices that are in the administrative record probably the most important one is when the f a a in two thousand and sixteen took newark from its level three t its level to status and it's important to understand the distinction in level three if you fly a flight that you don't have a slot for you face fines you face civil enforcement actions but when you go down to level two the whole point of going to level two was to get rid know there are some rare cases where courts have despite the numerous cases in this court saying that you shouldn't account for practical consequences there are some rare cases where the courts have none the less this court has nonetheless looked at practical consequences but when it is done so my understanding is been in a very narrow circumstances where for example you might face enforcement action so for example the same case where if you if you took an action and then the agency later decided that you were wrong then you would face enhanced penalties for having done it in the interim the most that spirit can say here and i want to point out by the way that the things that it's saying about its business costs are things that it's saying here oral argument it's not pointing to things in the record this is not an argument that it was even making in its opening brief about fidelity but the business costs that it's saying are not anything close to the kinds of things that this court was talking about when he's talking and absent about fines or other kinds of prosecutions the most that we're talking about is that there is some sort of uncertainty out in the future and i want to point out by the way that that uncertainty that they're worried about that's there regardless even if they get these approvals these approvals are only good for a six month scheduling season there's no legal requirement that when the f a a goes to the winter two thousand and twenty scheduling summer season or summer two thousand and twenty one that it continue existing grandfather policy is the uncertainty is there regardless historically the f a a has continued its grandfather in policy  and maybe for the carriers that provides them some sort of assurance and benefit that they know what the historical tendencies have been but it's not like if spirit got these approvals for a six month period it would be secure for sure that  all the uncertainty was gone so really all that we're talking about here is they're trading kind of one sort of loose situation for maybe kind of another informal security and again you honor i realize that we've been talking a lot about the legal effects but i also don't want to where we are mr shell just before we go beyond analogy i just had a quick one question or two how long does it take to go from level two to level three it is with the scheduling reduction meeting that's the way it was done at j f k in two thousand and seven and that that took a few months is my understanding there were meetings there were discussions ultimately they the process at the end of that was an order that forcibly reduced the flights at the airport and and issued a level three regime another way to do it is the way that it's been done at la guardia and then the way it's been done i think at j f k since that scheduling reduction meeting which is that the f a a has published a notice in the federal register it's gotten comments from people and then that the comments come back the f a a response to those comments it might make some changes in response to the comments you know i think the short answer is ark is is at level two and spirit is flying all these flights that they want to fly because compliance was voluntary and would you buy that airline ticket you know i think it depends on a lot of factors one thing to remember also is that even if you had complete knowledge of an airlines you know airline schedules airline schedules can change for a lot of reasons even once airlines get approval within the scheduling facilitation process things can change even within that process so even an airline that had you know certain a that airline might change its schedules for a whole host of other reasons so you know i think that's just a really hard question to answer without knowing more information if you were choosing as a purchaser between two airlines that were otherwise identical but one of them is facing at least the possibility whizzing it slots in a manner that spirit would face at least the possibility of losing it slots you are a purchase you're choosing between those two otherwise identical airlines would which airline would you buy your ticket from your honor i think even in that situation even that other airline it's not one hundred percent secure either because there's always the possibility out there that the f a a could go to level three and that's in fact what happened at j f k in two thousand and seven delays spiked at the airport and within a matter of few months you know airlines thought that they could fly in this completely unregulated regime there were no slot requirements or not even there were no star carmen's at j f k i think maybe j f k was level two at the time so i don't want to completely on regulators it but it certainly wasn't level three and then because of because of delays spiking at j f k the f a a had that scheduling reduction meeting it culminated in order and there were fewer flights at the airport so again even within this level to construct even the airlines that have these approvals even they don't have that level of certainty so i you know i think if you want to say is there maybe spirit has some indeterminate higher percentage that it might not get approval that it might not be able to fly it some flight in the future what that difference in percentages is really hard to say i certainly haven't seen anything in the record from spirit establishing that and of course you know that would be their burden as the party that  affirmatively asserting jurisdiction under forty six thousand one hundred and ten and you know as to what the percentage differences and whether that would affect a choice i think is just i don't know the answer to that and without more information and  d there's different models that are in the record and depending on which model you use you might get a slightly different answer i think if you use there was data that looked at november thousand schedules and that's probably the most comprehensive model in the record this is a tab in an excel spreadsheet it's in the joint appendix but is produced in native format it's a giant excel file that the courts will come to to go through it if it wants to  but at the end of the day if you look at the tab called e w r twenty one thousand and eleven dollars w o s w a two what that analysis shows is it's around three to four minutes projected per flight in the late afternoon to early evening period but remember that's per flight over approximately eighty flights per hour so we're not just talking kind of nothingness here we're talking real benefit and then the other thing to keep in mind is that arrivals and departures are not in equal poi's the patterns that you know large northeastern airports like newark would be that you tend to see more arrivals in the morning hours and to see more departures in the evening hours so that three to four minutes average is actually masking the fact that in the late afternoon evening where you see more arrivals and departures that you're seeing more benefits on the arrival side and again this is you know so this supported by the record citations in their briefs so perhaps your honor was relying on one of those assertions thank you before we leave if fed now i realize i'm i'm well over my time but i just want to make sure that i get the other answer said ginsburg's question about safe extensions which is that if you think all of what i've been saying about legal effect is wrong then it's still important to understand that spirit brought this challenge to an order that was issued before anybody had actually submitted their and twenty schedules and so if spirit sought that these approvals had legal effect if they thought that they had all these business consequences it was incumbent on them to at least wait until the approval process was done because at that point there would be more clarity about which fights  were approved and which fights weren't and indeed as we point out to the court some peak flights that were offered there were new peak flights that ended up getting approved in the summer two thousand and twenty scheduling session including so we're talking about summer two thousand and twenty one if the f a a continues its historical grandfathering policies then the fact that somebody was approved in summer two thousand and twenty if they operate those flights then they would under historical proceeding at all for all proceeding since now that it's been consistently reiterated that it's not going to reallocate these authorizations to the extent that they are operating caps the f a a has or the government seems to kind of try and walk back some of the mandatory ways here by a by forecasting or part or showing those that it's regulating that it intends to hold them to these without creating kind of a final agency action here especially in newark situation when there is not just the authorizations but the caps on the authorizations and the caps on flights which is unique to new york itself the sort of damocles that judge ginsburg has referenced that we think has fallen already here the f a a has given priority for the authorizations to united and that's a present a fact that puts us at a disadvantage today even if we can fly for a limited time in the interim government has said that we we didn't cite economic costs to spirit in our brief but that's actually at our reply on page nine in time where we referenced that the economic consideration made it impossible for spirit to kind of fly it added on an ad hoc basis when its flights could be canceled at any moment when the government also hasn't denied here that if we keep flying without authorizations and the service returns the prepared to the f a a would convert to level three and it's also clear from the record i think that when you have historic precedence and the priority during level two that does transfer over to level three and so there is this safe harbor that i referenced before so i i can see that i'm i'm past my time if there are no further for the questions we would ask the court to vacate the decision and grant our petition here thank you and your case is submitted