BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

Application of

BLUE JET SP. Z O.O. For a foreign air carrier permit pursuant to 49 U.S.C. § 41301 and exemption authority pursuant to 49 U.S.C. § 40109 (U.S.-Europe) Docket DOT-OST-2014-0026

CONSOLIDATED REPLY OF BLUE JET SP. Z O.O. TO JETBLUE AIRWAYS CORPORATION Communications with respect to th is document should be sent to: Gary B. Garofalo Erin M. Tallardy Jason E. Maddux Garofalo Goerlich Hainbach PC 1200 New Hampshire Avenue NW Suite 590 Washington, D.C. 20036 Phone 202-776-3970 Fax 202-776-3975 ggarofalo@ggh-airlaw.com etallardy@ggh-airlaw.com jmaddux@ggh-airlaw.com Counsel for Blue Jet Sp. z o.o.

March 20, 2014BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

Application of

BLUE JET SP. Z O.O. For a foreign air carrier permit pursuant to 49 U.S.C. § 41301 and exemption authority pursuant to 49 U.S.C. § 40109 (U.S.-Europe) Docket DOT-OST-2014-0026

CONSOLIDATED REPLY OF BLUE JET SP. Z O.O. TO JETBLUE AIRWAYS CORPORATION Blue Jet Sp. z o.o. (“Blue Jet”) hereby submits a consolidated reply to the answers filed by JetBlue Airways Corporation (“JetBlu e”) in this docket on February 27, 2014, 1 March 11, 2014, 2 and March 17, 2014. 3 As more fully set forth below, JetBlue’s request for the Department to deny or suspend Blue Jet’s application based on alleged name similar ity should be denied because (1) JetBlue already has resorted to private litigation in accordance with current Department policy, and (2) there is no significan t potential for, or ac tual, public confusion.

1 Letter from Toby Butterfield to Assi stant Secretary Susan Kurland (Feb. 27 , 2014) (hereinafter “First JetBlue Answer”).

2 Answer of JetBlue Airways Corporation in Opposition to Application of Blue Jet Sp. z o.o. for an Exemption (Mar. 11, 2014) (hereinafter “S econd JetBlue Answer”).

3 Answer of JetBlue Airways Corporation in Opposition to Application of Blue Jet Sp. z o.o. for a Foreign Air Carrier Permit (Mar. 17, 2014) (hereinafter “Third JetBlue Answer”).2 I. Part 215 Directs Air Carriers to the Courts to Resolve Trade Name Disputes. JetBlue’s position takes the industry back to th e days before airline deregulation. All but

one of the “multitude of cases” 4 cited by JetBlue where “the Department has not hesitated to protect consumers from confusion wh en the circumstances warrant it” 5 were decided by the Civil Aeronautics Board (CAB) prior to its suns et in 1985. More sign ificantly, in 1988, the Department substantially modified Part 215 of the Aviation Economic Regulations upon which the CAB had decided those cases, 6 a development JetBlue’s answ ers ignore. In the Part 215 NPRM, the Department found:

The present rules are duplicative of existing legal protections and inconsistent with the deregulation of the airline industry. They do not encourage air carriers to resolve po tential problems among themselves as do other unregulated businesses. In addition, they impose an undue burden on the industry; competitors ar e citing the use of arguably similar names as reasons to object to new a pplicants, thereby unnecessarily complicating and delaying the certificati on process. This serves to impede new entry because of the time and cost to an applicant of having to respond to such objections, which do not relate to the app licant's ability to operate. 7

In essence, prior to deregulation, carriers were trying “to convert licen sing proceedings into enforcement cases or to use those proceedings in lieu of lawsuits in the civil courts.” 8 The

4 Second JetBlue Answer at 15.

5 Second JetBlue Answer at 5.

6 See 53 Fed.Reg. 17921 (May 19, 1988) (hereinafter “Part 215 Final Rule”) (finalizing significant changes to Part 215); see also 52 Fed.Reg. 5547 (Feb. 25, 1987) (hereinafter “Part 215 NPRM”) (proposing significant changes to Part 215).

7 52 Fed.Reg. at 5547.

8 53 Fed.Reg. at 17922.3 Department’s goal in revising Part 215 was to “stop this use of an inappropriate forum” 9 and “encourage[] carriers to resolve potential prob lems in the use of names among themselves without unnecessary government intervention...” 10 As a result, the Department amended Part 215 to “reflect the change s that have occurred in the aviation industry concerni ng this issue since deregulation” 11 by “deleting those portions that set detailed rules and standards for applicati ons by carriers to change or use names different from those on their operating auth orizations and ... replac[ing] the detailed rules with a less complex and burdensome name registration system.” 12 In an analogous post-1988 case, Worldwide Airlin es Services, Inc., a certificated U.S. air carrier, objected to Leisure International Airways Limited’s application for a foreign air carrier permit on the grounds that Worl dwide already had registered the trade name Leisure

International Airlines. 13 Worldwide conducted domestic pass enger charter opera tions utilizing large aircraft. Leisure International Airways, a U.K. air carrier, proposed to operate charter foreign air transportation of passengers betw een the United Kingdom and the United States. When granting Leisure Internati onal Airways’ applica tion, the Department reiterated its policy, which remains in effect today: “pursuant to 14 CFR Part 215, as amended, we no longer make public interest determinations regarding name similarity. Responsibility for resolving name

9 53 Fed.Reg. at 17922.

10 53 Fed.Reg. at 17921.

11 53 Fed.Reg. at 17922.

12 53 Fed.Reg. at 17921.

13 Leisure International Airways Ltd., Order 1993-11-32 (Oct. 12, 1993) at 10.4 disputes rests with the affected air carriers through recourse to trade name statutes and the

courts.” 14 JetBlue’s answers are a blatant attempt to return to the past, regulatory-wise, by converting this licensing proceeding into a trad emark matter in direct contravention of the Department’s stated goals in revisi ng Part 215. As JetBlue acknowledges, 15 section 215.2 of the Aviation Economic Regulations states that Part 215’ s “purpose is to place the responsibility for resolving private disputes about the use of simi lar names with the air carriers involved, through

recourse to the trade names stat utes and the courts.” That s hould be the end of the inquiry. Indeed, in every Part 215 case since 1988 involving a U.S. air carrier and a foreign air carrier, the Department has stated “the respon sibility for resolution of name di sputes rests with the affected carriers through recourse to trade na me statutes and the civil courts.” 16 JetBlue is well aware of the Department’s pol icy as it already has instituted trademark litigation in the U.S. courts. 17 By availing itself of the judi cial process, JetBlue acknowledges that the Department is not the appropriate fo rum to litigate this matter as the Department expressly recognizes in Part 215. The Department should continue to follow its Part 215 policy by dismissing JetBlue’s objections and granting Blue Jet’s application.

14 Leisure International Airways Ltd., Order 1993-11-32 (Oct. 12, 1993) at 10.

15 See Second JetBlue Answer at 15 (quoting section 215.2).

16 Jet Airways (India) Ltd. Order 2006-11-9 (Nov. 14, 2006) at 4; see also Altasjet Uluslararasi Havacilik A.S., Notice of Action Taken in Docket DOT-OST-2003-15450 (Sep. 8, 2003) at 1; Challenge Air Luftverkehrs, Notice of Action Taken in Docket DOT-OST-2001-11057 (Mar. 29, 2002) at 2; Sportsflight Airways, Inc., Order 1995-10-17 (Oct. 10, 1995) at 2; Leisure International Airways Ltd., Order 1993-11-32 (Oct. 12, 1993) at 10; and Points of Call Airlines, Ltd., Order 1988-7-18 (Jul. 12, 1988) at 3.

17 See Complaint for Declaratory Judgment in cluded with the First JetBlue Answer.5 II. The Registration of Blue Jet’s Trade Na me Will Not Result in a Significant Potential for, or Actual, Public Confusion. Aside from attempting to frustrate the Depa rtment’s well-established Part 215 policy, JetBlue goes on to conjure up public confusion resul ting from Blue Jet’s service to and from the United States. Since 1988, the Department only in tervenes in trade name registration matters when there is “evidence of a significant poten tial for, or of actual, public confusion.” 18 The registration of the name “Blue Jet Sp. z o.o.” in the present proceeding will not result, and as shown below, has not resulted, in any pub lic confusion with JetBlue. In Order 1994-8-45, the Department decided an an alogous case in favor of the applicant. There, Jet USA Airlines, Inc. objected to the appl icant’s use of the trade name USA Jet Airlines,

Inc. 19 Despite any similarity between the names, the Department ruled it “w[ould] not deny the applicant the use of the corporate name “USA Jet”, nor will we rest rict its use of this name to only certain operations.” 20 The result should be no different here. In a long line of cases, the Department ha s found no evidence of a significant potential for, or actual, public confusion when there is significan t difference in operations in both geographic area of operations and type of operations. 21 Tellingly, only on two occasions since

18 14 CFR § 212.2 (2014).

19 USAir, Inc. also filed an objection regarding the trade name issue.

20 USA Jet Airlines, Inc., Order 1994-8-45 (Aug. 25, 1994) at 3.

21 Id. ; see also Rhoades Aviation, Inc. d/b/a Transair, Order 2013- 1-13 (Jan. 22, 2013) (finding little potential for the use of the same trade name to cause public confusion by Tr ans Executive Airlines of Hawa ii, Inc. d/b/a Transair, an on-demand air carrier operating small ai rcraft, and the applicant, an operator of large aircraft in an all-cargo configuration); Schuman Aviation Company Ltd. d/b/a Pacific Air Express, Order 2010-8-1 (Aug. 6, 2010) (finding no likelihood of public confusion resulting from Pacifi c Wings, LLC d/b/a Pacific Wings Airlines d/b/a PW Express, an intra-Hawaii scheduled and charter operator of 9-seat aircraft, and the applicant, which planned to use the “Pacific Wings Airlines” trade name only in connection with intra-Ha waii all-cargo operations); Arctic Transportation Services, Inc., Order 2010-2-11 (Feb. 12 , 2010) (failing to find any consumer harm from the applicant changing its corporate name to “Ryan Air, Inc.” despite the existence of two similarly named air carriers, Ryan Air International, Inc. and Ryan Air, Ltd.); Pa rtner Aviation Enterprises d/b/a Empire Airways, Order6 revising Part 215 has the Department exercised its authority to prohibit the registration of a trade name. JetBlue cited one of those cases, 22 Order 2006-6-36, which is readily distinguishable. Order 2006-6-36 involved the Department revoking registration of the trade name “Nantucket

2006-8-21 (Aug. 22, 2006) (finding no evidence in the reco rd that supports Empire Airlines’ position that public confusion will result because of name similarity); Tr adewind Aviation, LLC, Order 2006-5-10 (May 12, 2006) (finding that Tradewind Aviation’s proposed commuter operations, using 9-seat aircraft operated under 14 CFR Part 135, among seasonal destinations in the Caribbean and th e Northeast coast of the Unit ed States, are significantly different than those of Tradewinds Airlines’ operations in both geographical area of operations and type of operations); Omega Air Holdings, LLC d/b/a Focus Air, Order 2004-10-6 (Oct. 14, 2004) (finding no likelihood of significant consumer harm between Omega Air, Inc., a co mmercial aircraft leasing company, and the applicant, a charter all-cargo carrier utilizing large aircraft); Freedom Airlines, Inc. d/b/ a America West Express, Order 2002-4-3 (Apr. 3, 2002) (finding no consumer harm with the use of Aviation Services, Ltd. d/b/a Freedom Air, a Guam-based turboprop operator, and the applicant, a continental U.S. oper ator of regional jets); Ameristar Air Cargo, Inc., Order 2000-1-27 (Jan. 28, 2000) (finding no consumer harm in re gistering the trade name “Ame ristar” over the objections of Amerijet International, Inc.); Sun Jet International, Order 1999-2-3 (Feb. 2, 1999) (registering the trade name “Southeast Airlines” even though “Southeast Aviation” wa s a registered trade name already); Navcom Aviation, Inc., Paradise Airways, Inc., and Ultr air, Inc., Order 1 995-2-31 (finding no consum er harm because significant differences existed in both the type of operations Paradise Islands Airlines offered to the traveling public (small aircraft commuter operations) and in the geographic areas se rved (Florida-Bahamas) compar ed to Paradise Airways, which proposed to operate large jets between Washington, DC and New York); Capitol Air, Inc., Order 1994-10-32 (Oct. 25, 1994) (finding that Capitol Air’s and Capitol Air Express’ names were not identical, nor were their geographic areas of operation); Viki ng International Airlines, Inc. d/b/a Eagle Airlines, Order 1994-7-34 (Jul. 26, 1994) (denying Executive Airlines, Inc. d/b/a Am erican Eagle’s request to prohibit the applicant from holding out operations in the Caribbean); Jet USA Airlines, Inc., Order 1994-6-19 (Jun. 10, 1994) (finding an absence of substantive evidence of public confusion or th e likelihood of future consum er harm); Grand Airways, Inc., Order 1994-2-12 (Feb. 3, 1994) (finding that no pub lic confusion will result between the applicant’s name and MGM Grand Air, Inc.); AirTrain Corporation, Order 1994-1-3 (Jan. 6, 1994) (refusing to require AirTrain to change its name as a condition for approval of its application); Northwest Seaplanes, Inc., Order 1993-8-19 (Aug. 12, 1993) (denying Northwest Airlines, Inc.’s trad e name objection noting that the applicant has used the name for many years and there was no evidence of consumer confusion); Capitol Air Express, Inc., Order 1993-1-4 (Jan. 7, 1993) (denying Capital Airlines, Inc.’s request to not issue the applicant a certificate); Dash Airlines, Inc. d/b/a Eclipse Airlines, order 1992-11-50 (Nov. 27, 1992) (stating the new Part 215 policy while noting the issues now was moot in this case); Kiwi International Air Lines, Inc., Order 1992-7-25 (Jul. 21 1992) (noting amended Part 215 and denying Key Airlines, Inc.’s request to require the applicant to change its trade name); Emerald Air, Inc. d/b/a Emerald Airlines, Order 1991-7-44 (Jul. 30, 1991) (noting that the petitioner made no allegation that the applicant engaged in unfair and deceptive behavior ); Alaska Island Air, Inc., Alaska Ju neau Aeronautics, Inc. d/b/a Wings of Alaska, Markair, Inc., Order 1990-12-36 (Dec. 14, 1990) (removing a prior prohibition Markair from using “Alaska” in any trade name because, since the 1988 revisions to Part 215, such a condition wa s no longer appropriate); Complaint of American International Group, Inc. against American International Airways, Inc. and Connie Kalitta Services, Inc., Order 1989-12-38 (Dec. 21, 1989) (dismi ssing the complaint because AIG failed to show that registration of the trade name “American International” had resulted, or was significantly likely to result, in actual consumer harm); Gulf Air Company, Order 1988-6-3 (Jun. 2, 1988) (refusing to address a name similarity issue because of the soon to be effective amendments to Part 215).

22 The other case involved Caribbean Airlines Limited (CAL ) registering the “Air Jamaica” trade name as part of CAL’s assumption of Air Jamaica’s routes. See Notice of Action Taken in Docket DOT-OST-2010-0232 (Jun. 20, 2011) (finding CAL’s use of the “Air Jamaica” tr ade name could cause signif icant public confusion as consumers may believe the services were operated still by the old Air Jamaica). This case is inapposite to the current proceeding, which does not involve the us e of a trade name by a successor air carrier.7 Airlines” to Hyannis Air Service, Inc., a commute r air carrier, because Horizon Air Charter, Inc., an air taxi operator, already registered the tr ade name “Nantucket Shuttle.” The Department found “it is likely that there will be significant public confusion” 23 for several reasons and, therefore, decided to exercise its authority under Part 215. First, the two carriers intended to use the exact same name in their operations. 24 Second, both carriers intended to operate in the same geographic region. 25 Third, both carriers had been serving, an d intended to continue to serve, the

same markets. 26 Lastly, the two carriers operated similar small aircraft equipment. 27 In contrast, and as discussed more fully below, the parties he re are not using the same name, there is minimal overlap in their geographic area of operations, they serve comple tely different market segments, and they operate completely di fferent types of aircraft.

A. There is Little Overlap in Ge ographic Areas of Operation. Unlike in Order 2006-6-36, in addition to the difference in names, it would be difficult to

confuse the two air carrier s here as their operations are vastly different in terms of geographic area, type of operations, and type s of passengers served. JetBlue states it “is the premiere lowcost, high-quality domestic airline in the United States and currently serves more than seventy destinations in the United States, Mexico, Caribbean and South America.” 28 JetBlue also states it places its code on other carri ers’ flights to foreign points 29 and asserts consumers can purchase

23 Hyannis Air Service, Inc., Order 2006-5-10 (Jun. 28, 2006) at 3.

24 Id. at 2.

25 Id.

26 Id.

27 Id. at 2-3.

28 First JetBlue Answer at 1; see also Second JetBlue Answer at 10-12.

29 First JetBlue Answer at 1; see also Second JetBlue Answer at 10-11.8 “transportation from the United States to all regions of the world” utilizing its website. 30 Regardless of how it portrays the geographic extent of its servic e, the mainstay of JetBlue’s operations is regularly scheduled domes tic (U.S.) passenger operations. In contrast, Blue Jet Sp. z o.o., a Polish ai r carrier, operates on-demand, single entity charters primarily serving Europe . It goes without saying that, in accordance with the exemption and permit for which it has applied, Blue Jet cannot, and will not, engage in domestic (U.S.) operations. Thus, there is mi nimal geographic overlap. In the United States, Blue Jet’s operations will utilize primarily smaller airports catering to business jets as opposed to JetBlue, whic h must utilize larger airports capable of accommodating large aircraft. While JetBlue’s webs ite facilitates the purchase of transportation arguably to all regions of the world, for the most pa rt, that ability is only via interline agreements with other carriers, meaning such service is not even held out in JetBlue’s name to the traveling public. Indeed, to purchase such transportation, JetBlue’s website directs customers to the

websites of other air carriers entirely. 31 Also, though JetBlue claims that its codeshare partners display JetBlue’s code on flights be tween the United States and Europe, 32 the only authority granted by the Department in that regard is fo r JetBlue to place its code on Emirates flights

between Milan and New York. 33 This is hardly the geographi c overlap claimed by JetBlue as giving rise to public conf usion. Not only is there de minimis geographic overlap, but even that

30 Second JetBlue Answer at 10-11.

31 See http://www.jetblue.com/airline-partners/.

32 See Second JetBlue Answer at 11.

33 See Joint Application of JetBlue Airways Corporation a nd Emirates for a Blanket St atement of Authorization (May, 14, 2013) and Notice of Action Taken in Docket DOT-OST-2013-0103 (Jul. 24, 2013).9 negligible overlap cannot be viewed in a vacuum. Instead, it must be viewed in relation to the type of operations and passengers served, where again there is no real overlap.

B. There is no Meaningful Overlap in Type of Operations or Types of Passengers Served. JetBlue operates regularly sche duled service utilizing large ai rcraft, specifically, Airbus A321s, Airbus A320s, and EMBRAER ERJ-190s, the smallest of which has a standard seating configuration of 100 seats. 34 Also, as a U.S. low-cost carrier , JetBlue’s passengers are primarily U.S.-originating and more cost conscious and th erefore comprise the low-cost segment of the marketplace. By contrast, Blue Jet utilizes small busine ss jet aircraft, specifically the Bombardier Global 5000, Bombardier Challenger 300, Embraer Legacy 600, and Citation Sovereign. The largest of these aircraft, the Gl obal 5000, has a seating capacity of only 14 passengers. Blue Jet’s flights operate exclusively to Fixed Based Oper ators while JetBlue flights operate to airline terminals. With different equipment serving primar ily different airport destinations, there is little likelihood that any JetBlue commercial passenge r would ever even see a Blue Jet business aircraft let alone be confused by it. There is also little to no overlap in the rele vant consumers at issue. Blue Jet caters to high net worth travelle rs, primarily from Europe. Blue Jet’ s clients are sophist icated individuals and companies that routinely tr avel on, and have the needs and means to, charter business jet

aircraft.

34 See Second JetBlue Answer at 12.10 JetBlue’s statement that “the Blue Jet name leads to immediate confusion in the primary medium used by consumers for shoppi ng for air travel – the Internet” 35 simply shows JetBlue’s lack of understanding of how the business jet on-demand market place functions. Blue Jet’s clients are not surfing the Internet looking for fli ghts. Rather, they work with charter brokers, who act as intermediaries, and of ten are not aware of the charter carrier on which they will fly until further on in the chartering process. Most of Blue Jet’s clients even prefer that no carrier name be displayed on the aircraft they charter to give the impression that they are traveling on their own private jet. Accordingly, except fo r both operating passenger service, there is no meaningful overlap between the two carriers’ respective types of operations or passengers

served.

III. Any Perceived Similarities in Aircraft Color Scheme are Inaccurate and Irrelevant. JetBlue next asserts, “[d]espite the differen ce in equipment currently used by Blue Jet and JetBlue, the color scheme of Blue Jet’ s aircraft will lead to public confusion.” 36 As an initial matter, whether the two carriers’ liveries are si milar is a matter for the appropriate judicial forums to decide applying applicable trademark law, not a matter for the Department. However,

JetBlue’s assertion is absu rd nonetheless. First, of the six business jet aircra ft Blue Jet intends to

utilize for on-demand charters to and from th e United States, only one, the Global 5000 pictured in the Second JetBlue Response, has a color scheme that includes a fuselage with any blue on it; and this color scheme was in place when Blue Jet acquired the aircraft. Bl ue Jet’s other aircraft bear completely different color schemes, su ch as white with red and gold stripes.

35 Second JetBlue Answer at 3.

36 Second JetBlue Answer at 12.11 Second, if having a livery consisting of a fuse lage with a white top and a blue bottom and

a blue tail meant consumers would be unable to distinguish between tw o air carriers, then JetBlue has a larger problem because that is the predominant livery of US Airways. 37 Figure 1: US Airways Aircraft 38

Clearly, JetBlue has no exclusive ri ghts to the ornamental use of wh ite and blue on an aircraft.

The rhetorical claim that “the use of the Bl ue Jet name is a transparent attempt by Blue

Jet to derive benefit from JetBlue’s consider able investments in its high-quality, consumerfriendly service and brand” 39 lacks any support. The fairly descriptive name Blue Jet was created in 2008 for use in Europe, Africa, and As ia, where, as discussed above, JetBlue does not

37 See http://www.usairways.com/en-US/aboutus/pressroom/photo s.html (containing US Ai rways aircraft photos).

38 http://www.usairways.com/en-US /resources/images/aboutus/pressroom/US_Airways_767-200.jpg

39 Third JetBlue Answer at 3.12 do business under its own name. Since Blue Jet is a high-end executive charter operator, it would not have benefited at all from any similari ty with the name of a regularly scheduled lowcost airline in the United States . In fact, any confusion betwee n the names would only serve to harm Blue Jet’s image and business. In short, JetBlue should not be heard to claim bad faith adoption when there is no evidence of such.

IV. There is No Evidence of Actual Public Harm or Confusion. Undoubtedly, JetBlue scoured its internal cust omer records, as well as the Internet, to find evidence of actual public harm or confusio n, and all it was able to find was one child’s drawing as supposedly compelling ev idence of actual public confusion. 40 First, children are not the relevant consumers here as they are not purchasing tickets and making travel decisions. Second, a single instance of alleged actual confusion is a de minimis amount of evidence given that Blue Jet has been operating in the United States for several years. See Savin Corporation v. The Savin Group , 391 F.3d 439 (2d Cir. 2004). Indeed, Blue Jet long ago ini tiated service to th e United States. Blue Jet has been operating charters to and from the United Stat es since 2010 pursuant to a Department-issued Part 375 Special Authorization. Af ter over four years of operations to the Un ited States, Blue Jet is unaware of any evidence of public harm or confusion, and it has not received any consumer complaints, either directly or through th e Department, regarding its operating name

. The claim that “the initiation of service by Bl ue Jet will cause immediate confusion to the public and harm to JetBlue...” 41 is simply untrue because it has not already happened since

40 See Second JetBlue Answer at 8-9.

41 Second JetBlue Answer at 15.