1 ORDER 20 10

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UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C. Issued by the Department of Transportation on the 21 st day of January , 20 10

________________________________________________ : ALASKA AIRLINES, INC ., ET AL. , : : DOCKET NO. v. : OST

- 20 0 7

- 27331 : LOS ANGELES WORLD AIRPORTS, ET AL. : :

ORDER GRANTING AN INTERIM STAY OF PROCEEDINGS AND EXTENDING DEADLINE TO FILE PROCEDURAL COMMENTS

On November 24, 2009 t he U nited S tates Department of Transportation (Department) issued its Initial Request for Status and Comments (Order 2009

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- 24) to initiate further proceedings in this case following the mandate issued on September 25 , 2009 by the U nited S tates Court of Appeals for the District of Columbia Circuit in Alaska Airlines, Inc., et al. v. U.S. Department of Transportation , 575 F.3d 750 (D.C. Cir. 2009).
That case arose o ut of the Department’s Final Decision (Order 2007

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- 8 , J une 15, 2007 ) issued under 49 U.S.C. § 47129 on the reasonableness of new terminal fees and new fee methodologies imposed on the Los Angeles International Airport, following complaint filed by certain air carriers in Terminals 1 and 3 1

1 Southwest Airlines and US Airways operate out of T erminal 1. Alaska Airlines, AirTran Airways, ATA Airlines, Frontier Airlines, and Midwest Express operate out of T erminal 3

. (T1/T3 Carriers) against the airport operator, Los Angeles World Airports (LAWA). The Airports Council International

–2 NA (ACI

- NA) intervened on behalf of LAWA and the Air Transport Association (ATA)
intervened on behal f of the T1/T3 Carriers. 2

On December 22, 2009, following a telephone conference with the parties regarding procedural issues held on December 1 6, 2009, the Department issued its Order Amending Time to File Procedural Comments (Order 2009

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- 17) inviting the parties to file, no later than January 18, written submissions on the five remanded issues

. All parties were invited to file replies to the submissions on January 28, 2010. See Order
2009

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- 17, ¶¶ 2 and 3. As explained in Order 2009

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- 24, the D.C. Circuit remanded five issues to the Department for it to address.

As explained in Order s 2009

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- 24 and 2009

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- 17 , subsequent to the court’s
issuance of the September 25, 2009 mandate , the Department requested the parties to report on the status of any settlement discussions . On January 7, the Department held a
status conference call with LAWA and the T1/T3 Carriers at which the parties advised the Department of their agreement on one of the five remanded issues (that is, the
timeliness of the T1 Airli nes’ objection to fair market valuation), of their intention to devote additional time attempting to reach agreement on the four remaining remanded
issue s , and of their intention to request an exten sion of the January 18 filing date of their
submissions to October 18 in order to provide additional time to engage in further
settlement discussions. The Department inform ed the parties that it would consider their request favorably, upon submission of an appropriate motion

. On January 11, t he parties filed t heir Joint Motion to Extend the Current Deadline in this Proceeding from January 18 to October 18 (Joint Motion)

. The Joint Motion

2 In response to Ord er 2009

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- 24, LAWA, the T1/T3 Carriers, and ATA have submitted their initial information and comments on the status of settlement discussions regarding the remanded issues, and ACI has indicated its intent to submit comments as well3 detailed the settlement agreement to date involving certain claims by the T1 Carriers and noted that the parties needed an adequate amount of time to “finally and completely” resolve the remaining remanded issues . The Joint Motion requested a stay of proceedings
in the case until October 18 and requested that if LAWA and any or all of the T1/T3
Airlines are unable to resolve the remaining issues, the proceeding would continue and they would make their filings by October 18. The parties informed the Department that
counsel for ACI

- NA and for ATA, respectively, do not oppose the Joint Motion. The Department is willing to gra nt the relief requested in the motion and wishes to encourage a local settlement of the remaining remanded issues. Therefore , the Department will require the parties provide status reports of settlement discussions every 60 days beginning March 18 through September 18 in order to keep the Department apprised of the progress of the settlement negotiations

. Accordingly,
1. We grant the Joint Motion;
2. We hereby stay the proceeding on remand until October 18, during which the Los Angeles World Airport, on the one hand, and any or all of the T1/T3 Airlines, on the other hand, will attempt to resolve the remaining remanded issues described in
Order 2009

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- 24 at 2

- 3, namely Paragraphs No. 1 (Airfield vs. non

- airfield space), 2 (Other aeronautical uses of terminal sp ace), 4 (Burden of persuasion on rentable space) and 5 (Monopoly power) ; 3. We order the T1/T3 Carriers and LAWA to file written status reports as to the progress of their settlement discussions by March 18, May 1 7 , July 1 6 and4 September 14 , or until such ear lier time as the Department may order as appropriate ; and
4. We hereby amend Ordering paragraphs 2 and 3 of Order 2009

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- 17 as follows:
2. We invite the T1/T3 Carriers, the Los Angeles World Airports , the Airports Council International

– NA, and the Air Tra nsport Association, to
file writ ten submissions on the following : 1) whether the current record
evidence on the remanded issues described in Paragraphs No. 1 (Airfield

vs. non
- airfield space), 2 (Other aeronautical uses of terminal space) , 4 (Burden of p ersuasion on rentable space) and 5 (Monopoly power ) of
Order 2009

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- 24 at 2

- 3 , is sufficient or requires supplementation; 2) what, if any, additional fact finding or evidence is contemplated and for
which of the remanded issues described above ; 3) the jus tification for such additional fact finding or evidence; 4) whether an oral evidentiary hearing is necessary to hear the new evidence, if any ; and 5) any other procedural or evidentiary issues the parties wish to note, no later than October 18, if a
settle ment agreement of all the issues is not achieved by that date; and
3

. We invite the T1/T3 Carriers, the Los Angeles World Airport, the5 Airports Council International

– NA, and the Air Transport Association to file replies to the submissions described in Ordering paragraph 2 , no later
than October 28, if a settlement agreement is not achieved by October 18

.

SO ORDERED.

B y:

CHRISTA FORNAROTTO Deput y Assistant Secretary for Aviation and International Affairs (SEAL)
Dated: January 21 , 20 10
An electronic version of this document is available on the World Wide Web at http://dms.dot.gov//reports/reports_ aviation.asp