Order 2015-1-14

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

 Issued by the Department of Transportation

 on the 15th day of January, 2015

 

 Served: January 15, 2015

 

ORDER ON RECONSIDERATION

Summary

By this order the Department grants the petition of Delta Air Lines, Inc. (Delta) for 

reconsideration of Order 2014-12-9 in the above captioned proceeding. On reconsideration, the 

Department denies the relief requested.

Background

Under the Memorandum of Understanding between the United States and Japan signed on 

October 25, 2010, four daily slot pairs are available to carriers from each country to provide 

scheduled combination services between the United States and Tokyo’s Haneda Airport.1

 As a 

result of three prior proceedings, by Orders 2010-7-2, 2013-2-4, and 2014-4-6, the Department

has now allocated the four slot pairs as follows: 1) one slot pair to Hawaiian Airlines, Inc. 

(Hawaiian) for Honolulu-Haneda service; 2) two slot pairs to Delta, one for Los Angeles-Haneda

and one for Seattle-Haneda services; and 3) one slot pair to United Airlines, Inc. (United) for San 

Francisco-Haneda service.2

 1 The scheduled operations are subject to the following conditions: 1) U.S. operations at Haneda are 

permitted between 2200 and 0700 hours local time; 2) departures from Haneda to a point in the 48 

contiguous U.S. states are not permitted prior to midnight; and 3) extra sections are not permitted.

2 Following a carrier route selection proceeding, the Department initially allocated the four U.S.-Haneda 

slot pairs as follows: Delta at Detroit, Delta at Los Angeles, Hawaiian at Honolulu, and American at New 

York (JFK). See Order 2010-7-2. In 2012, Delta applied to relocate its Detroit-Haneda service to the 

Seattle-Haneda market. Following a second carrier selection proceeding, in which competing proposals 

were submitted by American, Hawaiian, and United, the Department awarded Delta authority to provide 

service between Seattle and Haneda. See Order 2013-2-4. Subsequently, in 2013, American ended its 

New York-Haneda service, and returned the slot pair to the Department for reallocation. Following a 

Petition of

DELTA AIR LINES, INC.

in the matter of 2010 U.S.-Haneda 

Combination Services Allocation Proceeding

 Docket DOT-OST-2010-0018
2

On October 2, 2014, American Airlines, Inc. (American) filed a motion asserting that Delta 

intends to operate limited winter season service in the Seattle-Haneda market, and that Delta 

plans to serve the market for one week every 90 days, which is just enough to prevent the slot 

pair from automatically reverting to the Department based on the dormancy condition imposed 

by the Department on the slot pair.3 Based upon those circumstances, American requested

(1) that the Department withdraw Delta’s daily U.S.-Haneda slot pair that was awarded for 

Seattle-Haneda services; and (2) reallocation of that slot pair to American for Los AngelesHaneda services.

On October 9, 2014, Hawaiian filed a motion to reopen Order 2013-2-4, and an answer to the 

motion and application of American. Hawaiian specifically requested that the Department 

(1) reopen the case where Delta was awarded Seattle-Haneda authority and modify the dormancy 

condition to require meaningful year-round service; (2) grant American’s motion to withdraw the 

Seattle-Haneda slot pair from Delta; and (3) institute a new proceeding to develop a factual 

record before reallocating the slot pair.

By Order 2014-12-9, the Department instituted this proceeding to determine the disposition of 

the Seattle-Haneda slot pair, currently allocated to Delta. In light of Delta’s extensive winterseason Seattle-Haneda service cutbacks, the submissions of American and Hawaiian and the 

responses thereto, the Department found that the public interest required a fresh examination of 

whether the best use of the Seattle-Haneda opportunity is to allow Delta to retain the slot pair for 

Seattle-Haneda service, or whether the public interest would be better served by reallocating the 

slot pair for service from another U.S. city by another U.S. carrier or by Delta. 

The Order set forth a procedural schedule and evidentiary requirements for the establishment of a 

record for the Department to make a decision in this case. Pursuant to the procedural schedule, 

petitions for reconsideration were due December 22, 2014; and answers to petitions were due 

January 2, 2015.4

Petition of Delta

On December 22, 2014, Delta filed a petition for reconsideration of Order 2014-12-9, arguing

that the Department’s decision to institute this proceeding is arbitrary and capricious. Delta 

contends that the Seattle-Haneda slot pair was awarded indefinitely, subject to two conditions: 

(i) that Delta retain the necessary underlying authority to serve the markets authorized, and (ii) 

that the slot pair will become dormant and will revert automatically to the Department if it is not 

used for a period of 90 days. Delta argues that it is in full compliance with those conditions, and 

that Order 2013-2-4, where Delta was allocated the slot pair, contains no other notice or grounds 

for revocation of that authority.

 

carrier selection proceeding involving United and Hawaiian, the Department selected United for Haneda 

service from San Francisco. See Order 2014-4-6.

3 The allocation of the U.S.-Haneda slot pair to Delta is subject to the Department’s standard condition 

pertaining to dormancy, whereby the slot pair will be deemed dormant and will revert automatically to the 

Department if it is not used for a period of 90 days. See Order 2013-2-4, at 5.

4 The procedural schedule set forth in Order 2014-12-9 also established due dates for 

applications/supplements/amendments, answers, and replies. This order addresses only the petition of 

Delta and the answers filed thereto. 
3

Delta further contends that the Department has not adequately supported its authority to 

reallocate frequencies to ensure they are used effectively and in a manner that promotes 

competition and otherwise best serves the public interest. Delta asserts that the two orders cited 

by the Department as precedent do not, in fact, support its decision here. Delta argues that those 

orders5 established procedures for the return of unused frequencies and placed the carrier being 

awarded authority (Evergreen) on notice that unused frequencies could be reallocated. Delta 

argues that those orders demonstrate that in this instance, the Department must follow the 

procedures that it established in Order 2013-2-4, and that the Seattle-Haneda slot pair may be 

reallocated only if Delta were to violate the dormancy condition.6

Delta also argues that the Department has permitted other similarly situated carriers to retain 

limited-entry authority that has not been used for much longer periods, while this proceeding 

subjects the Seattle-Haneda slot pair to reexamination on the basis of single season cutbacks. 

Delta again argues that it has firm plans to provide Seattle-Haneda service daily as of March 29 

through the summer season.7

Lastly, Delta argues that the Department ignored proposed alternatives to this proceeding, by not 

considering the proposal to consider amending the dormancy condition.8

Responsive Pleadings

On January 2, 2015, American and Hawaiian each filed answers to Delta’s petition. 

American asserts that Delta’s contentions are legally incorrect, and that the Department has 

inherent power to review prior decisions, so long as Delta is given notice and a hearing, which is 

exactly the purpose of this proceeding. In response to Delta’s arguments that it has complied 

with the dormancy condition, American contends that the condition only specifies the basis for 

automatic revocation, while saying nothing about other, non-automatic grounds for revocation. 

American argues that Delta has severely cut back its Seattle-Haneda service, that the Department 

is right in holding this proceeding, and that Delta’s petition should be denied.

Hawaiian also contends that the Department has the power to reallocate the Seattle-Haneda slot 

pair, despite Delta’s compliance with the dormancy condition. Hawaiian argues that the 

Department’s instituting order is not arbitrary and capricious because this proceeding provides

Delta with notice and an opportunity for a hearing, where Delta can present any concerns it may 

have. 

Decision

The Department has decided to grant Delta’s petition for reconsideration, and on reconsideration, 

to deny the relief requested. 

In reaching this result, we are following a longstanding Department precedent. Specifically, in 

Order 97-11-35 we instituted the 1997 U.S.-Argentina All-Cargo Frequency Proceeding to 

 5 Order 95-2-30, at 5 and Order 94-12-7, at 8.

6 Delta Petition, at 3.

7 Delta Petition, at 6.

8 Delta Petition, at 6-7.
4

consider, among other things, whether we should reallocate frequencies then held by Challenge 

Air Cargo, Inc. (Challenge). Challenge argued that it had “used [its] frequencies within the 90-

day dormancy period, which is the only established requirement, and that the Department cannot

now impose additional standards to establish whether the frequencies are dormant.” Order 97-

11-35 at 5. The Department rejected Challenge’s position and maintained the proceeding, saying 

it need not make a determination regarding the dormancy condition because “we are instituting 

this proceeding under our general powers to review the public interest bases of the current 

awards.” Id. at 6, n. 12. Challenge petitioned for reconsideration, seeking rescission of the 

instituting order or modification of the proceeding. On reconsideration, the Department granted 

Challenge’s petition and denied the requested relief. Order 97-12-19. We see nothing in Delta’s 

petition that would cause us to follow a different course here.

As indicated in Order 2014-12-9, the Department has determined that, in light of Delta’s 

extensive winter-season cutbacks, and the submissions filed on the record in this case, the public 

interest requires a fresh examination of whether the best use of the Seattle-Haneda opportunity is 

to allow Delta to retain its underlying authority to operate the slot pair for Seattle-Haneda 

service, or whether the public interest would be better served by reallocating the slot pair for 

service from another U.S. city by another U.S. carrier or by Delta. Delta has presented no 

information that would lead the Department to alter that conclusion.9 

The Department has instituted this proceeding under its general powers to review the public 

interest bases of current awards. The Department believes that procedures established in Order 

2014-12-9, will provide Delta, as well as any other interested carriers, ample opportunity to 

argue its position and present any evidence it may wish to present.10 

The Department, therefore, denies Delta’s request to vacate Order 2014-12-9.

ACCORDINGLY,

1. We grant Delta Air Lines, Inc. (Delta)’s petition for reconsideration of Order 2014-12-9, and 

upon reconsideration we deny the relief requested; and

 9 We note Delta’s assertions that certain U.S.-Brazil frequencies have gone unused for periods of time 

with no action by the Department to reexamine those frequencies. Delta, however, has not brought to our 

attention any Brazil cases where the Department took no action in the face of a challenge to such 

frequencies by a carrier with firm plans to use them. 10 With regard to Delta’s assertion that the Department consider modifying the standard dormancy 

condition, as we noted in the instituting order, parties are free raise this issue on the record of this 

proceeding.
5

2. We will serve this order on all parties to the proceeding.

By:

SUSAN L. KURLAND

Assistant Secretary for Aviation

and International Affairs

(SEAL)

An electronic version of this document is available on the World Wide Web at

http://www.regulations.gov