BEFORE TH E DEPARTMEN T O F TRANSPORTATIO N OFFIC E O F TH E SECRETARY WASHINGTON , D.C . Motio n o f UNITED AI

RLINES , INC . For Confidentia

l Treatmen t Under Sectio n 302.3 9 Docket OST-95-67 5

MOTIO N O F UNITED AI RLINES , INC . T O WITHHOLD INFORMATIO N FRO M PUBLI C DISCLOSUR E Pursuan t to Rul e 39(e ) o f

th e Departmen t

o f Transportation , Offic e o f

th e Secretar y Procedural Rules , Unite dAi r Lines , Inc . ("United" ) hereb y files thi s Motio n t o Withhol dFro mPubli c Disclosure th e informatio n containe d in aseale d envelop e an d captione d Schedul e B-4 3 hiventor

y o f Airfram e and Aircraf

t Engine s an d delivere d to th e Offic e o f Aviatio n Transportatio n Management . Thi s informatio n i s provide d pursuan t to Par t 24 1 o f th e Department' s Economi c Regulations , 1 4 CFR241 , and i s par t o f For m4 1 Schedule s B- 7 an d B-43 . Th e informatio n sought to b e withhel d frompubli c disclosure detail s United' s acquisitio n cos t

an dsale s realizatio n amount s wit h respec t t o new and use d aircraf

t and aircraf

t engines , eac h broke n dow n b y model , individual serial number , and individual purchas e o r sal e prices . Th e informatio n fo r whic h Unite d seek s confidentia l treatmen t

unde r thi s instan t Motio n i s simila

r to andconsisten t

wit h tha t fo r whic h th e Departmen t

granted , in 199 3 and 199 4 orders , confidential treatment to simila r Schedul e B-7/B-4 3 dat afiledseparatel y b y United , America

n Airlines , Inc . ("American" ) an d Delt aAi r Lines , Inc . ("Delta") . Th e informatio n sought

t o b e withhel d fall s withi n Exemptio n 3 o f th e Freedo m o f Informatio n Ac t

( 5 U.S.C . 552(b)(3)) , whic h exempt s fromdisclosure informatio n require d b y statut e to b e withheld . Exemptio n 3 provide s that :

K:\Aireraf l - DOT\DOT\B 7 an d B4 3 DOT 04 2009.DO C"(b ) Thi s sectio n doe s no t appl y to matter s tha t are.. .

provide s that : (3 ) specificall y exempte d fromdisclosur e b y statut e (othe r tha n sectio n 552(b ) o f thi s title) , provide d tha

t suc h statut e (A ) require s tha t th e matter s b e withhel d fromth e publi c in suc h amanne r a s t o leav e n o discretio n on th e issue , o r

(B ) establishe s particula

r criteri afo

r withholdin g o r

refer s t o particula

r type s o f matter s t o b e withheld; " Sectio n 110

4 o f th e Federa

l Aviatio n Ac t

o f 1958 , a s amende d (th e Act) , "An y perso n ma

y make writte n objectio n to th e publi c disclosur e o f informatio n containe din any application , report , o r documen t

filed pursuan t

t o th e provision s o f thi s Act. . . statin g th e ground s fo r suc h objection . Any informatio n containe din suc h application , report , o r document . . . shal l b e withhel d from publi c disclosur e b y th e . . . Secretar y o f Transportatio n . . . i f

disclosur e o f

suc h informatio n woul d. . . adversel y affect th e competitiv e positio n o f any ai r carrier i n foreig n ai r

transportation. " Unite dconsider s th e requeste d informatio n delete d fromSchedule s B- 7 and B-4 3 t o b e highl y sensitiv e an dconfidential . Th e ai r transportatio n industry , bot h domesticall y an d internationally , ha s becom e highl y competitive . Aircraf t ownershi p cost s ar

e amajor cos t o f doin g busines s fo

r al l certificate dcarriers . A carrier' s abilit y to reduc e it s aircraf

t ownershi p cost s relativ e to it s competitor s can , therefore , provid e acarrier asignificant

competitiv e advantage . I

n a n effor t t o secure suc h a

n advantage , Unite d applie s considerabl e management resource s to tryin g t o reduc e it s aircraf t ownershi p costs . Thi s include s devotin g substantial resource s t o tryin g to obtai n airframe s an d engine s a t th e lowes t

possibl e acquisitio n cos t

and disposin g o f

thes e asset s a

t th e highes t

possibl e sale s price . Moreover , th e negotiation s fo r new equipment are mad e more difficult

b y th e fac

t tha t there are only thre e manufacturer s o f larg e je t airframe s andonl y thre e o f larg e je t engines . However , a s lon g a s th e Departmen t make s availabl e t o th e publi c United' s acquisitio n cos t fo r eac h airframe and engin e i t acquire s and th e sale s proceed s realize don eac h sal e o f suc h equipment , Unite d i s denie d th e benefi t o f thes e efforts , harmin g Unite dcommercially .

Onc e United' s cost s are divulged , United' s competitor s ca n us e thes e cos t

dat ato negotiate contrac t

pric e adjustment s fromth e sam e supplier s Unite d i s usin g o r fromcompetin g suppliers . Sinc e man y o f

tlies e competin g carrier s ar e foreig n flag carriers , thei r equipment price s wil l never

b e reporte dto th e Department , le t alon e b e mad e public . I

t i s no t onl y commerciall y damagin g bu t basicall y unfair

to Unite d and all other

U.S . carrier s to requir e

K:\Aircraf t - DOT\DOT\B 7 an dB4 3 DO T 0 4 2009.DO Cthe mto divulg e to thei r non-reportin g foreig n flag competitor s th e fixiits o f thei r compefitiv e effort s wit h manufacturer s t o secur e th e bes t possibl e purchas e price . See , e.g. . Order 81-12-9 . Th e disclosur e o f

United' s ownershi p cost s o f individual aircraf

t and aircraf

t engine s woul dallo w competin g foreig n an d domesti c airlines , manufacturer s o f aircraf t and engines , andne w anduse daircraf t owner/lessor s to calculate and closel y trac k United' s cost s t o reduce , transfer

o r dispos e o f

it s variou s fleets o f

use d mode l aircraf

t an d relate d use d aircraf

t engines . I t woul dadversel y affect

United' s competitiv e positio n b y strengthenin g th e bargainin g positio n o f

other airlines , includin g foreig n airlines , an d aircraf t owner/lessor s seekin g t o purchas e aircraf

t equipmen t

frommanufacturer s and others . The y woul d b e abl e to us e thei r knowledg e o f

United' s confidential purchas e an d sal e arrangement s a s startin g point s in thei r ow n negotiations , an dthu s improv e thei r abilit y t o obtai n equa

l o r mor e favorabl e prices . Thi s woul dleadto United' s competitors , includin g foreig n competitors , bein g abl e t o enjo y lower

capital cost s than otherwis e th e case , and t o thei r bein g abl e to operat e an d compete mor e efficiently wit

h Unite dtha

n otherwise . Unite dsubmit s tha

t FOL A Exemptio n 3 i s applicable , a s aresul t o f th e provisio n i n Sectio n 110

4 o f th e Ac t requirin g th e withholdin g frompubli c disclosur e o f any informatio n containe din arepor

t filed pursuan t

t o th e Act , i f

suc h disclosur e woul d "adversel y affect th e competitiv e positio n o f

any ai r carrie r i n foreig n air

transportafion " (4 9 U.S.C . App . 1504) . Th e informatio n fo

r whic h Unite dseek s confidentia l treatmen t

under thi s instan t

Motio n i s simila

r to an dconsisten t

wit h tha t fo r whic h th e Department

grante d confidentia

l treatment , in (i ) a Marc h 29 , 199 3 order

concernin g simila

r Schedul e B- 7 dat afiledb y Delta , (ii ) aNovembe r 1 , 199 3 order concernin g simila

r Schedul e B- 7 dat afiled b y American , (iii ) aDecember 29 , 199 3 order concernin g simila

r Schedul e B-7/B-4 3 dat afiled b y United , (iv ) a n Augus t 23 , 1994 order concernin g simila

r Schedul e B-7/B-4 3 dat afiled b y Delta , an d (v ) aNovembe r

18 , 1994 order concernin g simila

r Schedul e B- 7 dat afiled b y United . Th e Department' s grant s o f confidentialit

y wer e specificall y mad e imder Exemptio n 3 (and it s 199 3 grant s wer e mad e exclusivel y under

Exemptio n 3 ) sinc e Delt aand American , like United , compete wit h foreig n ai r carrier s wh o do no t

file suc h informatio n ye

t ar e free to obtai n U.S . carrier informatio n from th e Department . Th e Departmen t there stated : "thi s lac k o f reciprocal access , th e Departmen t believes , coul d substantiall y har mth e competitiv e positio n o f

American , resultin g in th e erosio n o f th e U.S . international airlin e industry. " Unite dals o submit s tha

t th e informatio n sought

to b e withhel d fall s withi n exemptio n 4 fromth e Freedo mo f Informatio n Act , 5 U.S.C . 552(b)(4) , whic h provide s protectio n fromdisclosur e fo r "trad e secret s and commercia l o r financial informatio n obtaine d fromaperso n an dprivilege do r confidential;... " Unite d believe s th e requeste d informatio n delete d fromSchedul e B- 7 andB-4 3 clearl y satisfie s all thre e element s require d fo r protectio n under Exemptio n 4 . First , th e acquisitio n cos t and sale s realizatio n amount s reporte d are substantiall y th e sam e a s negotiate dbetwee n th e parties , whic h purchas e and sal e price s ar e

K:\Aircraf t - DOT\DOT%B 7 an d B4 3 DO T 0 4 2009.DO Cclearl y financial o r commercia

l i n nature . Second , Unite d establishe d thes e price s tliroug h it s negotiation s wit

h privat e thirdparties ; th e informatio n wa s no t obtaine d fromany governmental entities . Third , th e disclosure o f suc h informatio n woul d har mUnited' s competitiv e position . Se e Gul f & Wester n Indus. . Inc . v . Unite d States , 61 5 F.2 d 52 7 (D.C . Cir . 1979) , National Park s & Conservatio n Ass' n v . Morton . 49 8 F.2 d 76 5 (D.C . Cir . 1974) , Steriin g Drug . Inc . v . Federal Trad e Comm'n . 45 0 F.2 d69 8 (D.C.Cir . 1971) , Th e Tinke n Co . v . U.S . Custom s Service , 49 1 F.Supp . 55 7 (D.C . Cir . 1980) , Braintre e v . Dept . o f Energy . 49 4 F.Supp . 287 , an d Burke Energ y Corp . v . Departmen t o f Energy . 58 3 F.Supp . 50 7 (D . Kan . 1984) . Finally , th e Department' s 199 4 grant s o f confidentialit

y (i.e. , it s Augus t

23 , 1994 orde r

concernin g simila

r Schedul e B-7/B-4 3 dat afiledb y Delta , an d it s Novembe r 18 , 199 4 order

concernin g simila

r Schedul e B-7/B-4 3 dat afiledb y United ) wer e specificall y mad e under both Exemption s 3 an d 4 . Th e Department , whe n decidin g United' s (and American' s and Delta' s respective ) prio r

B-7/B-4 3 confidentialit

y motions , grante d aten-yea r confidentia

l perio d beginnin g on th e dat e th e informatio n wa s require d t o b e filed pursuan t

to 1 4 CF R241.22(a) . Unite ddeserve s t

o b e treate dn o les s favorabl y wit h respec t to th e seale d Schedul e B- 7 an d B

4 3 attache dhereto .

WHEREFORE , Unite d request s tha t th e Department , pursuan t t o Rul e 3 9 o f

it s Rule s o f Practic e andExemption s 3 an d 4 o f th e Freedo mo f

Informatio n Act , withhol d from publi c disclosure , (i ) th e pric e informatio n containe d i n th e Airfram e and Aircraf

t Engin e Acquisitio n an

dRetirement s item s whic h hav e bee n delete d fromcolumn s 9 , 1 0 and 1 1 o f th e publi c filing o f

United' s quarterl y For

m4 1 Schedul e B- 7 report , an d (ii ) th e item s whic h hav e bee n delete dfromth e publi c filing o f United' s annua

l For m4 1 Schedul e B-4 3 report , respectively , fo

r aperio do f

no t les s than te n years . Respectfiill y submitted ,

Davi d B . Olausse n Senio r Counse l UNITED AI

RLINES , INC . DATED : Februar

y 1 , 201 0

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