BEFOR E TH E ,,,,_ . ^ DEPARTMEN T O F TRANSPORTATIO N ' ' • ^ ^ ' "' ' ^ ^ ' OFFIC E O F TH E SECRETAR Y WASHINGTON , D.C .

Motio n o f UNITE D AI RLINES , INC . Fo r Confidentia l Treatmen t Unde r Sectio n 302.3 9 Docke t OST-95-67 5

MOTIO N O F UNITE D AI RLINES , FNC . T O WITHHOL D INFORMATIO N FRO M PUBLI C DISCLOSUR E

Communication s wit h respec t t o thi s documen t

shoul db e sen t

to : DAVI D B . OLAUSSE N Senio r Counse l UNITE D AI RLINES , INC . 7 7 W . Wacke r Chicago , I L 6060 1 312-997-806 9 DATED : Apri l 29 , 201 1BEFOR E 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 Ducket OST-95-67 5

MOTIO N O F UNITED AI RLINES , INC . T O WITHHOL

D INFORMATIO N FROM PUBLI C DISCLOSUR E Pursuant to Rul e 39(e ) o f

th e Department

o f Transportation , Offic e o f th e Secretar y Procedura

l Rules . Unite dAi r

Lines , Inc . ("United" ) hereb y file s thi s Motio n to Withhol dFromPubli c Disclosur e th e informatio n containe di n aseale denvelop e an

dcaptione d Schedul e B- 7 Airframe an dAircraf t Engin e Acquisition s an

dRetirement s an ddelivere dt o th e Offic e o f Aviatio n Transportatio n Management . Thi s infomiatio n i s provide dpursuan t t o Par t 24 1 of th e Department' s Economi c Regulations , 1 4 CF R241 , an di s par t o f For m4 1 Schedul e B-7 . Th e informatio n sough t t o b e withiiei dfro

mpubli c disclosur e detail s United' s acquisitio n cos t

an dsale s realizatio n amount s wit h respec t to new an duse daircraf

t an daircraf

t engines , eac h broken dow n b y model , individua

l seria l number , an dindividual purchas e or sal e prices . Th e informatio n fo r whic h Unite dseek s confidentia l treatment

unde r thi s instan t Motio n i s simila

r t o an dconsisten t

wit h tha t fo r whic h th e Departmen

t granted , i

n 199 3 an d 199 4 orders , confidentia

l treatmen t

to simila r Schedul e B- 7 dat afiledseparatel y b y United , America n Airlines , Inc . ("American" ) an dDelt aAir Lines , Inc . ("Delta") . Th e infomiatio n sought

to b e witliliei dfall s withi n Exemptio n 3 o f th e Freedo m o f Infonnatio n Ac t

( 5 U.S.C . 552(b)(3)) , vvhic h exempt s fro

mdisclosur e informatio n require d b y statut e t o b e withlield . Exemptio n 3 provide s that ;

K.Aiicrar i - lX)T2Uir.B7DOT:( mIQTRdo c"(b ) Thi s sectio n doe s no t apply to matter s tha t are.. .

* * * : ^ * (3 ) specificall y exempte dfromdisclosur e b y statut e (othe r tha n sectio n 552(b ) o f thi s title) , provide dtha

t suc h statut e (A ) require s tha t th e matter s b e witlihel dfro

mth e publi c i

n suc h amanne r

a s to leav e n o discretio n o n th e issue , or

(B ) establishe s particula

r criteri afo

r withlioldjn g or

refer s to particula

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

4 o f th e Federa

l Aviatio n Ac t

o f 1958 , a s amende d(th e Act) , provide s that ; "An

y perso n ma

y mak e writte n objectio n t

o th e publi c disclosur e o f

informatio n containe di

n an y application , report , or

document

filedpursuan t

t o th e provision s o f thi s Act . . . statin g th e ground s fo r suc h objection . An

y informatio n containe di

n suc h application , report , or document

. . . shal l b e withhel dfrom publi c disclosur e b y th e . . . Secretar y o f Transportatio n . . . i f

disclosur e o f

such informatio n woul d. . . adversel y affec t th e competitiv e positio n o f an y air carrier i n foreig n air

transportation. " Unite dconsider s th e requeste dinformatio n delete dfromSchedul e B- 7 to b e highly sensitiv e an dconfidential . Th e ai r transportatio n industry , bot h domesticall y an

d intemationally , ha s becom e highl y competitive . Aircraf t ownershi p cost s are amajor cos t o f doin g busines s fo

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

t ownershi p cost s relativ e t o it s competitor s can , therefore , provid e acarrie r asignificant

competitiv e advantage . I

n a n effor t to secur e suc h a

n advantage . Unite dapplie s considerabl e management resource s t

o 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 dengine s a

t th e lowes t

possibl e acquisitio n cos t

an d 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 ar e onl y tlire e manufacturer s o f larg e je t airframe s an

donl 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 to th e publi c United' s acquisitio n cos t fo r each airframe an

dengin e i t acquire s an

dth e sale s proceed s realize do n eac h sal e o f suc h equipment . Unite di s denie dth e benefi t o f thes e efforts , harmin g Unite dcommercially .

Onc e United' s cost s ar

e divulged . United' s competitor s ca n us e thes e cos t

dat ato negotiate contrac t

pric e adjustment s fromth e same supplier s Unite di s usin g o r fromcompetin g suppliers . Sinc e many o f

thes e competin g carrier s arc foreig n (la g carriers , thei r

equipment price s will neve

r b e reporte dt

o th e Department , le

t alon e b e mad e public . I

t i s not onl y commerciall y damagin g but basicall y unfair

t o Unite dan

dal l othe r U.S . carrier s t

o require

K Aia-rjf t • 00720 1 !>.B?DO

T 201 1 fQT

H Jo cthemto divulg e t o thei r non-reportin g foreig n flag competitor s th e fruits o f thei r competitiv e effort s wit h manufacturer s t

o secure th e bes t

possibl e purchas e price . See , e.g. . Orde r 81-12-9 . Th e disclosur e o f

United' s purchase s an ddisposition s o f individual aircraf

t an d aircraf t engine s woul dallo w competin g foreig n an ddomesti c airlines , manufacturer s o f aircraf t an dengines , an

dne w an dusedaircraf

t owner/lessor s l o calculate an dclosel y trac k

United' s cost s to inquire , modify , transfer or dispos e o f

it s variou s fleet s o f

use dmodel s aircraf

t (an d relate duse daircraf

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 othe r airlines , includin g foreig n airlines , an daircraf t owner/lessor s seekin g to purchas e aircraf t equipment

frommanufacturer s an

dothers . Tliey woul db e abl e to us e thei r knowledg e o f

United' s confidentia

l purchas e an dsal e arrangement s a s startin g point s i

n thei r own negotiations , an

dthu s improv e thei r

abilit y to obtai n equa

l or mor e favorabl e prices . Thi s woul dlea dt o United' s competitors , includin g foreig n competitors , bein g abl e to enjo y lower

capital cost s tha

n otherwis e th e case , an

dto thei r bein g abl e to operat e an dcompet e mor e efficientl y wit h Unite dthan otherwise . Unite dsubmit s tha

t FOI 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 an y informatio n containe di n arepor

t filedpursuan t

to th e Act , i f

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

an y ai r carrie r i n foreig n ai r

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

r whic h Unite dseek s confidentia l treatment

under thi s instant

Motio n i s simila

r t o an dconsisten t

wit h tha t fo r whic h th e Department

grante dconfidential treatment , i n (i ) a March 29 , 199 3 orde r

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 datafiledb y United , fiv ) a n Augus t 23 , 199 4 order concernin g simila

r Schedul e B- 7 dat afiledb y Delta , an

d(v ) aNovembe

r 18 , 1994 orde r concernin g simila

r Schedul e B- 7 dat afile

db y United . Th e Department' s grant s o f confidentialit

y wer e specificall y mad e under Exemptio n 3 (an dit s 199 3 grant s wer e mad e exclusivel y under

Exemptio n 3 ) sinc e Delt aan dAmerican , lik

e United , compete wit

h foreig n ai r carrier s who d o no t

file suc h infomiatio n ye

t are free to obtai n U.S . carrier informatio n from th e Department . Th e Department there stated ; "thi s lack o f reciprocal access , th e Department believes , coul dsubstantiall y har mth e competitiv e positio n o f

American , resultin g i

n th e erosio n o f

th e U.S . international airitn e industry. " Unite dals o submit s tha

t th e intbnTiation sought

to b e withhel dfall s withi n exemptio n 4 fromth e Freedo mo f Infomiatio n Act , 5 U.S.C . 552(b)(4) , whic h provide s protectio n fromdisclosur e fo r "trad e secret s an

dcommercia

l o r financial informatio n obtaine d fro maperso n an dprivilege do r confidential;... " Unite dbelieve s th e requeste dinformatio n delete dfro

mSchedul e B- 7 clearl y satisf y all thre e element s require dfo r protectio n under Exemptio n 4 . First , th e acquisitio n cos t an dsale s realizatio n amount s reporte dare substantiall y th e same a s negotiate dbetwee n th e parties , whic h purchas e an dsal e price s ar

e clearl y financial

- 3 KiiAin-rat t - 007^201 1 vB7DO T 20 1 i tQTRdo co r

commercial i

n nature . Second , Unite destablishe dthes e price s throug h it s negotiation s wit h privat e thir

dparties ; th e informatio n wa s not obtaine dfroman

y governmenta l entities . Third , th e disclosur e o f

suc h informatio n woul dhar mUnited' s competitiv e position . Se e Gulf& Wester n hidus. . Inc . v . Unite dStates . 61 5 F.2d52 7 (D.C . Cir . 1979) , National Park s & Conser\-atio n Ass' n v . Morton . 49 8 F.2 d76 5 (D.C . Cir . 1974) . Sterlin g Drug , Uic . v . Fedeia l Trad e ComnVn . 45 0 F.2 d69 8 (D.C.Cir . 1971) , TheTinke n Co . v . U.S . Custom s Service . 49 1 F.Supp . 55 7 (D.C . Cir . 1980) , Sraintre e v . Dept . o f Enerev . 49 4 F.Supp . 287 , an dBurk e Energ v Corp . V . Department

o f Energy . 58 3 F.Supp . 507 (D . Kan . 1984) . Finally , th e Department' s 199 4 grant s o f

confidentialit

y (i.e. , it s Augus t

23 , 199 4 orde r

concernin g simila

r Schedul e B-7/B-4 3 dat afiledb y Delta , an dit s November

18 , 199 4 order

concernin g simila

r Schedul e B- 7 dat afiledb y United ) were specificall y mad e under bot h Exemption s 3 an d4 . Tii e Department , whe n decidin g United' s (andAmerican' s an dDelta' s respective ) prio r

B- 7 confidentialit

y motions , grante daten-yea r confidential perio dbegimiin g o n th e dat e th e informatio n wa s require dt o b e filedpursuan t to 1 4 CF R241.22(a) . Unite d deserve s lo b e treate dn

o les s favorably wit

h respec t t o th e seale dSchedul e B- 7 attache dhereto . WHEREFORE , Unite drequest s tha t th e Department , pursuan t t o Rul e 3 9 o f

it s Rule s o f Practic e an

dExemption s 3 an

d4 o f th e Freedo mo f

Informatio n Act , withhol dfrom publi c disclosure , th e pric e informatio n containe di n th e Airframe an dAircraf t Engin e Acquisitio n an dRetirement s item s whic h hav e been delete dfromcolumn s 9 , 1 0 an d1 1 o f th e publi c filing o f

United' s quarterl y For

m4 1 Schedul e B- 7 repor

t fo r aperio do f

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

Davi dB . Olausse n Senio r Counse l LrNITE D AI RLINES , INC . DATED ; Apri l 29 , 201 1

. 4

- K:'Aiicrjt i - DOTJO l T B7DO T 201 1 IQT Rdo c