Communications with respect to this document should be sent to: Mike Borsetti 1 Montgomery St Ste 2500 San Francisco, CA 94104 mike@borsetti.com
19 May 2013 BEFORE THE

DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

In Re British Airways Plc Multiple Price Advertising Violations of 49 U.S.C. § 41712 and 14 CFR 399.84(a) Docket DOT

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- 2013

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FURTHER COMMENTS IN SUPPORT OF DOT INVESTIGATION INTO BRITISH AIRWAYS PLC VIOLATIONSFurther Comments of Borsetti

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

In Re British Airways Plc Multiple Price Advertising Violations of 49 U.S.C. § 41712 and 14 CFR 399.84(a) Docket DOT

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- 2013

- 002 5

FURTHER COMMENTS IN SUPPORT OF DOT INVESTIGATION INTO BRITISH AIRWAYS PLC VIOLATIONSFurther Comments of Borsetti

2 I update the chart I submitted in DOT

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- 0060 to incorporate issues raised by British Airways in its Answer ( DOT

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- 2013

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- 0062 ) and Sur

- Reply ( DOT

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- 0071 ) , the latter only recently ( 13 May 2013) made available on www.regulations.com :

1. I update the fuel surcharge revenue to the figure provided by Mr. Edelman in DOT

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- 0068 , Reply of Benjamin Edelman , page 7, which incorporates British Air ways’ comments from DOT

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- 00 62 , British Airways Plc A nswer to Complaint , as British Airways never provided actual or estimated revenue fi gures. $44,327 $75,668

$- $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000

Fuel surcharge revenue Cost of fuel 

## BOS
- LHR (estimate) single 777 flight

Fuel cost as of 25 January 2013

$31,341 Excess revenue over costFurther Comments of Borsetti

3 2. I update t he cost of fuel to reflect a price of fuel of $1,054.8 per tonne , as suggested by British Airways on page 6 of DOT

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- 2013

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- 0071 , Sur

- Reply of British Airways Plc to Reply of Complainant

. 3. It is worth noting that the ex act amount of ex cess revenue I depict is irrel evant to this proceeding as it underestimates the amount by which British Airways bursts through the DOT’s requirement that fuel surcharges “must be an accurate reflection of the fuel cost over some reasonable baseline ” 1 (emphasis mine)

. I do not determine what a reasonable baseline is 2 , nor do I estimate its amount.

M ETHODOLOGY

4. I am sure the DOT wil l have no trouble seeing through the economic fallacy of British Airways’ assertion that additional fuel loaded for reserves, but not burned, should be somehow included in the calculation of cost of fuel 3 . Not only 100% of such unused fuel is recovered (ai rcraft tanks are “topped off” during refueling, and the remai ning fuel after each flight is not, as the proposed methodology would imply, drained and disposed as waste), but the methodology used by me is based on the actual and verified 4

1 United States of America, Department of Transportation, Office of the Secretary, Notice : Additional Guidance on Airfare/Air Tour Price Advertisements, February 21, 2012 . Retrieved on 19 May 2013 from http://airconsumer.dot.gov/rules/Notice.Taxes.fees.sam.dl.13.website.pdf 2 A reasonable baseline is probably one based on the cost of fuel on or about March 31, 2004 , as per DOT

OST

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- 0071 , page 3: “BA’s fuel surcharge was introduced after the end of fiscal year 2004 (March 31, 2004)” 3 DOT

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- 0071 , page 6: “Mr. Borsetti, like Mr. Edelman, also failed to factor in European U nion regulations that require the plane to carry approximately the jet fuel necessary to fly for eight to nine h ours.” 4 Originally sourced (in my previous Comment) from British Airways plc. (2013, March 13). British Airways Plc Report and Accounts year ended 31 December 2012 . Retrieved 21 March 2013 from http://phx.corporate

ir.net/External.File?item=UGFyZW50SUQ9MTc1Njk3fENoaWxkSUQ9LTF8VHlwZT0z&t=1

.Further Comments of Borsetti

4

average overall British Airways fuel consumption rate, which therefore includes the amount of fuel burned to carry the extra fuel required for reserves as well as any add itional fuel burned for diversions and other off

- schedule events.

C URRENT DATA

5. It is worth noticing that a review of the actual price from IATA’s website 5 shows the latest reported price at $897.2, the lowest it has been since January 25, 2013 (shortly before Mr. Edelman filed his complaint) . Notwithstanding this dramatic 15% r eduction in fuel costs, British Airways’ fuel surcharge s are unreduced 6

.

5 International Air Transport Association (IATA) (2013, April 26), Fuel Price Analysis . Retrieved 19 May 20 13 from http://www.iata.org/publications/economics/fuel

- monitor/Pages/price

- analysis.aspx 6 Passenger fuel surcharges retrieved from price quotes obtained at https://www.britishairways.com on 19 May 2013; Cargo fuel surcharges retrieved from https://www.iagcargo.com/iagcargo/portlet/en/htm l/surcharges on 19 May 2013.Further Comments of Borsetti

5 6. The up

- to

- date chart therefore looks as follows:

7. British Airways’ fuel surcharge s for BOS

- LHR

- DOH are still lower than
t he fuel surcharges for BOS

- LHR 7 (see my previous Comments, DOT

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- 2013

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- 00 60 , Page 3, British Airways Fuel Surcharges Have No Relationship to Fuel Consumption ).

7 Retrieved from price quotes obtained at https://www.britishairways.com on 19 May 2013 $37,704 $75,668

$- $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000

Fuel surcharge revenue Cost of fuel 

## BOS
- LHR (estimate) single 777 flight

Fuel cost as of 26 April 2013

$37,964 Excess revenue over costFurther Comments of Borsetti

6

C ONCLUSIONS I am a simple consumer with zero law training writing on his free time on a Su nday, not a team of seven attorneys (most of whom probably billng by the hour), so pardon my brevity.
The facts in this docket speaks for themselves: British Airways has never provi ded any actual, verifiable data

-- actual fuel surchar ge revenue, actual fuel costs, and how fuel surcharge revenue is shared under the integrated joint venture with American Ai rlines 8 . It has acted similarly to a child caught red

- handed, offering a jumbled series of inventive arguments, some truly head scrat chers 9

. Mr. Secretary, it’s time to go forth and enforce the law!

8 See DOT

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- 0058 9 See, for example, the implied assertion made by British Airways, cited above, that it throws away the unburned fuel remaining after each flight. Other flaws include the use of total fuel expenditures, as o pposed to per - passenger fuel expenditure, to justify a per - passenger fee, invalidating the way the arg ument is presented (total fuel expenditure are affected by changes in the size of the total operation, which grew over time, especially in 2012 when British Airways purchased and integrated Bmi). Furthermore, while BA asserts that it “does not intend to engage in a never

- ending loop of dueling calculations with Mr. Edelman”, it does not provide the actual, verifiable revenues and cost figures that would conclusively put a stop to the estimation loop it laments about.Further Comments of Borsetti

7

C ERTIFICATION

T he contents of this motion and the attached exhibits are true and correct to the best of my knowledge and belief

. Pursuant to Title 18 United States Code Section 1001, I Mik e Borsetti, have not in any manner knowingly and willfully falsified, concealed or failed to disclose any material fact or made any false, fictitious, or fraudulent statement or knowingly used any documents which contain such statements in connection with the preparation, filing or prosecution of this motion . I understand that an individual who is found to have violated the provisions of 18 U.S.C. section 1001 shall be fined or impri soned not more than five years, or both

.

Respectfully s ubmitted ,

___________________________ Mike Borsetti 19 May 2013Further Comments of Borsetti

8 CERTIFICATE OF SERVI CE

A copy of the foregoing has been served as required by 14 C.F.R. § 302 .7 this day of 19 May 2013 upon the following parties via e lectronic mail , and no indication was r eceived that any transmission had failed :  For the U.S. Department of Transportation: o Sam uel Podberesky , Esq., Assistant General Counsel for Aviation E nforcement & Proceedings : sam.podberesky@dot.gov
 For British Airways: 1. Richard Mendles, General Counsel, Americas : richard.mendles@ba.com 2. James B. Blaney, Senior Counsel, Americas : jim.blaney@ba.com 3. Richard F. Hans , DLA Piper LLP : richard.hans@dlapiper.com 4. Keara M. Gordon, DLA Piper LLP : keara.gordon@dlapiper.com 5. Colleen Carey , DLA Piper LLP: colleen.carey@dlapiper.com 6. Don H. Hainbach , Garofalo Goerlich Hainbach PC : dhainbach@ggh

airlaw.com 7. Erin M. Tallardy, Garofalo Goerlich Hainbach PC: etallardy@ggh

airlaw.com
 For the Complainant: o Benjamin Edelman, Esq. : ben@benedelman.org

___________________________ Mike Borsetti