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UNITED STATES DEPARTMENT OF TRANSfl© 

FEDERAL AVIATION ADMINISTRA 

WASHINGTON, DC 

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LTIONI 

AIRPORT/ENVIRONMENTAL 

LAW, AGC-600 ^ 

RDM, LLC, 

Complainant, 

TED STEVENS ANCHORAGE 

INTERNATIONAL AIRPORT, 

Respondent. 

Docket No. 16-09-14! 

r "'1 

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REPLY TO RDM'S ANSWER TO 

MOTION TO DISMISS 

The above matter should be dismissed with prejudice because the RDM, 

LLC, ("RDM") lacks standing to bring an action under 14 C.F.R. Part 16, and because 

the complaint seeks review of matters not proper for review under Part 16. RDM's 

"Answer to Motion to Dismiss" actually demonstrates that the motion by Respondent, 

State of Alaska, Department of Transportation & Public Facilities (Alaska DOT&PF), 

sponsor of the Ted Stevens Anchorage International Airport ("ANC") is well-founded 

and should be granted because 

A. RDM has no standing under Part 16 because as RDM has not 

demonstrated that either RDM or AGLAD are, or proposed to be, an aeronautic user or 

provider of aeronautic services. 

B. RDM has no standing as it was not "directly and substantially 

affected" by the alleged actions of the Alaska DOT&PF with respect to AGLAD. 

C. Contract terms not prohibited by law or grant assurances, but 

agreed to by AGLAD as a matter of contract, are not proper subjects for review under 

Part 16. 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 1 of 17 

Docket No. 16-09-14 
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A. RDM Lacks Aeronautic User Standing 

RDM's Answer to Motion to Dismiss and its Reply to TSAIA Answer 

("RDM Reply") has brought into clear focus an issue not readily apparent from its 

original complaint, but that may be fully dispositive of this matter: The issues in this 

case all relate to real estate development by a real estate developer, which is arguably 

not aeronautic use subject to Part 16 at all,' 

In DeSciose v. City of Long Beach, FAA Docket No. 16-99-12 

(February 20, 2001) (Director's Determination), the Director made clear that not every 

developer of aeronautic facilities is considered an aeronautic user: 

Established FAA policy and procedures reflect the inherent 

limitation of our grant assurance jurisdiction involving matters of 

unjust economic discrimination and exclusive rights. Specifically, 

the Preamble to FAA Rules for Airport Proceedings explains that 

"[njonaeronautical users of airports are subject to the same 

'directly and substantially affected' standard as aeronautical users, 

and could foreseeably have standing to file a complaint .... 

However, most of an airport's [grant assurance] obligations are 

intended for the benefit of aeronautical users. A complaint 

alleging that an airport operator's treatment of a nonaeronautical 

user violates such obligation would be dismissed even though the 

nonaeronautical user was directly and substantially affected by the 

[allegedly violative] practice. For example, the assurance against 

unjust discrimination by an airport operator only applies to 

aeronautical users, so a complaint by a nonaeronautical user 

' It is important to note that Alaska DOT&PF never distinguished between 

AGLAD, CargoPort or any other lessee or lease applicant based on it being perceived to 

be a real estate developer rather than a proposed aeronautical user. Alaska DOT&PF 

endeavors, to and believes that it does, treat all applicants and tenants fairly and, to the 

extent similarly situated, consistently in compliance with 49 U.S.C. § 47107(a) and the 

Sponsor Grant Assurances—except as justified by relevant differences between lessees, 

projects, businesses, timeframes, circumstances, etc. It was only RDM's description of 

itself and the AGLAD development, together with the DeSciose case, that suggested the 

assurances may not, strictly speaking, apply here. In any event, Alaska DOT&PF 

believes it treated AGLAD in complete compliance with the grant assurances whether 

they apply or not, and that RDM's allegations of disparate treatment are either 

unfounded, or the differences were fully justified by dis-similar situations. 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 2 of 17 

Docket No. 16-09-14 
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alleging unjust discrimination by an airport operator would be 

dismissed. 

While the Complainant appears to argue that he is an FBO through 

the subleases offered by AeroRealty and has standing to file the 

instant complaint, the FAA is not convinced that a lessee of 

airport property can be considered an FBO simply by subleasing 

its leasehold to private aeronautical service providers that, in 

turn, provide aeronautical services to the public. FAA Order 

5190.6A defines a fixed-base operator (FBO) as an individual or 

firm operating at an airport and providing general aircraft services, 

such as maintenance, storage, ground or flight instructions, etc. 

(See Order 5190.6AI Appendix 5). The definition clearly indicates 

that an FBO provides aeronautical services directly to the public. 

Additionally, FAA Order 51 90.6A further provides that "the 

airport owner is not obligated by agreements with the Government 

to provide space unless the activity offers services to the public or 

support services actually needed by those aircraft operators 

otherwise entitled to use the public landing areas." (Order 

5190.6A, par. 4-15) 

DeSciose (Director's Determination) at 24 (emphasis added). AGLAD did not propose 

to operate as an FBO, defined in Appendix 5 to former 5190.6A as "m. Fixed-Base 

Operator (FBO)- an individual or firm operating at an airport and providing general 

aircraft services such as maintenance, storage, ground and flight instructions, etc." 

FAA Order 5190.6A, Appendix 5. AGLAD proposed only to lease to aeronautical 

service providers. 

In affirming the Directors Determination in DeSciose, the Acting 

Associate Administrator made the point even more clearly in specifically distinguishing 

real property developers from aeronautic users, and noting that Part 16 is not available 

to the former: 

The issue of whether Westland is a developer or a fixed base 

operator is a critical element in this review. If Westland is 

characterized as a developer and [the complainant] as a fixed base 

operator, the two could not be considered similarly situated and the 

Complainant could not prevail on a claim of unjust economic 

discrimination. If both Westland and [the complainant] are 

characterized as developers, they might be similarly situated, but 

would not fall under the grant assurances designed to protect 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Pages of 17 

Docket No. 16-09-14 
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aeronautical users. In that case, an issue would have been raised 

relevant to [the complainant's] standing and whether he would 

have been permitted to bring this Part 16 complaint forward. The 

FAA could review this complaint and evaluate allegations of 

unjust discrimination under the grant assurances only if both 

enterprises were characterized as aeronautical and were similarly 

situated. 

DeSciose v. City of Long Beach, FAA Docket No. 16-99-12 

(December 13, 2001) (Final Decision and Order at 27) (emphasis added). 

So is RDM, or for that matter, AGLAD, an aeronautic user, or a real estate 

developer such that RDM's allegations are beyond Part 16 jurisdiction? For a hint to 

the answer to that question, one need look no further than the banner across the bottom 

of the stationery of RDM's managing member, Debenham Properties, LLC: "/4 real 

estate development company." See Exhibit C to RDM Reply (also provided as ANCAGLAD-0198-0199) (emphasis added). 

Looking further only confirms and drives home the conclusion that RDM 

is a real estate developer and AGLAD was in the real estate development, and not the 

aeronautical service business. RDM's Answer to Motion to Dismiss refers repeatedly to 

the "AGLAD development."^ See, e.g. Answer to Motion to Dismiss at 1, Section 1, 

and 2, numbered paragraph 7 (emphasis added). According to RDM's complaint, it 

appears that AGLAD was not an aeronautic user, but a real estate developer. 

Managed by Alaska Global Logistics Airpark Development, Inc. 

(emphasis added), AGLAD's proposed project was all about facility development, not 

rendering aeronautical services. Indeed, aside from its proposed development of leased 

•^ Although RDM refers repeatedly to "AGLAD's development," the 

photographs Alaska DOT&PF submitted at ANC-0002 through 0009 show quite plainly 

that AGLAD/Postmark, LLC ("AGLAD") never actually developed anything on its 

leasehold. To any extent that Alaska DOT&PF quotes an RDM reference or otherwise 

refers to "AGLAD's development" Alaska DOT&PF refers to the proposed 

development and expressly disclaims any implication that any development ever 

occurred on AGLAD's leased premises. 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 4 of 17 

Docket No. 16-09-14 
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airport land, the only "service" AGLAD appears to have intended was leasing building 

and ramp space, as described at the outset of RDM's Complaint: 

The Development 

AGLAD Postmark LLC was developing 40 acres at Ted Stevens 

Anchorage International Airport (See Project Development Area 

Map below) that would have consisted of air-cargo and logistics 

facilities at the AGLAD site under a long-term ground lease (55-

year lease). 

The AGLAD facilities would have generated revenue by leasing 

building space and providing ramp parking positions (areas that 

allow refueling, de-icing, etc.), known as hardstands, for air-cargo 

carrier and maintenance companies. 

Complaint at 2. Notably, RDM does not say AGLAD planned to conduct re-fueling or 

de-icing, but only provide space where its "air-cargo carrier and maintenance 

compan[y]" tenants could perform or receive those services. RDM's complaint uses 

forms of the word "develop" or "development" more than 80 times, but never mentions 

"services." 

The RDM Reply only brings the real estate development nature of 

AGLAD's venture into sharper focus: 

a. "RDM's management company, Debenham Properties, LLC owns over 

$40M of investment real estate in Alaska, Utah and Nevada. Debenham 

Properties specializes in development, acquisitions and property 

management of industrial space." RDM Reply at 2 (numbered 

paragraph 5) (emphasis added); 

b. Description of ''the development process," referring to the "postconstruction phase" as "management of the project" (as opposed to 

operation of an aeronautical service business) and referring to preconstruction as "efforts to court and sign tenants." RDM Reply at 9-10 

(numbered paragraph 6) (emphasis added); 

c. Assertion that "the development" existed, even though it remained only a 

proposed and planned idea, description of "how developments occur," 

and discussion whether "tenants should come to the land lease signing 

with their developments pre-leased," and the "time needed to court and 

negotiate with prospective tenants." RDM Reply at 10 (numbered 

paragraph 9) (emphasis added); 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 5 of 17 

Docket No. 16-09-14 
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d. Reference to Pegasus Aircraft Maintenance as "a major anchor tenant to 

AGLAD's development." RDM Reply at 11 (numbered paragraph 9-10) 

(emphasis added); 

e. Reference to Cathay Pacific Airways Limited as "a major anchor tenant to 

AGLAD's development." RDM Reply at 12 (numbered paragraph 9-8) 

(emphasis added); 

f Comparison of its "prospective project" to "on in which a developer 

controls prime real estate," effectively equating AGLAD to "a developer" 

but without control of the property until it signed the lease. RDM Reply 

at 20 (numbered paragraph 19-3.J (emphasis added)); 

g. Reference to fact that "Long-term financing is always the hardest 

financing to secure for a development." RDM Reply at 22 (numbered 

paragraph 19-7.e) (emphasis added); 

h. "If developers are going to invest millions of dollars into projects at 

TSAIA they need to know that TSAIA is not going to willfully priceundercut them." RDM Reply at 25 (numbered paragraph 19-1 l.b) 

(emphasis added). 

Although AGLAD proposed to construct facilities on which aircraft could 

taxi and at which they could be refueled and serviced, AGLAD did not actually propose 

to perform any of the aeronautical services. AGLAD has never performed any 

aeronautical service anywhere for anyone. Neither, it seems, has RDM or any other 

member of AGLAD. Going back to documents submitted in 2004, it is clear the past 

experience and focus was real estate development. See Experience in Design-Build 

Projects included as part of VGA's Business Plan, ANC-AGLAD-0103 at 0106-0110. 

In the same mold, the firm that preceded RDM in AGLAD, Sherron Associates, Inc., 

was a real estate developer. See ANC-AGLAD-0118. That history fits nicely with 

RDM's observation that "RDM's management company, Debenham Properties, LLC ... 

specializes in development, acquisitions and property management of industrial space." 

RDM Reply at 2 (numbered paragraph 5). 

AGLAD proposed to develop facilities to be leased to a range of 

aeronautical service providers and to air carriers where the carriers could service 

themselves or receive services from the other tenants. Nowhere in any of its filings 

does RDM assert, much less provide evidence to prove, that it or AGLAD proposed to 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 6 of 17 

Docket No. 16-09-14 
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do anything other than develop space to lease. In all of its "pre-construction phase" 

activities, AGLAD worked to "sign tenants" to "leases" not secure aeronautical services 

contracts. 

RDM's single-minded focus on real estate development explains why 

RDM so adamantly insists that the "AGLAD's development" is comparable to that of 

FedEx and UPS "developments." Looking only at construction and physical 

functionality, but not at all on business model, RDM completely fails to recognize how 

completely dis-similar AGLAD was as proposed developer of multi-tenant lease 

facilities from FedEx and UPS as Signatory Air Carriers constructing facilities for their 

own use to meet their own needs. Even if there was any possibility that AGLAD might 

have wound up providing some aeronautical services had it successfully completed its 

"development," there is no doubt that its primary business model was that of a real 

estate developer, not an aeronautic service provider. 

But even to any extent that the FAA might determine that AGLAD could 

be considered an aeronautic service provider because it would own aeronautic facilities 

and potentially provide aeronautical services, that would not make AGLAD similarly 

situated to a Signatory Airline—or to Alaska CargoPort, LLC. CargoPort does not 

provide aeronautic services. 

Alaska DOT&PF has previously stressed the differences between 

AGLAD and CargoPort, which is an experienced developer of air cargo facilities with 

substantial capital backing developing at ANC at a time when, among other things, the 

air cargo development model remained unproven. See Answer, Exhibit A, ^ 18.B. But 

it turns out that even more important to this case is the fact that CargoPort is also a real 

estate and facility developer, not an aeronautic service provider. According to 

CargoPort's Anchorage manager. Ken Lythgoe, CargoPort provides no aeronautic 

services. CargoPort manages its facility as a commercial property manager. Tenants 

provide for themselves or contract to others for all aeronautical services. See Affidavit 

of Kenneth J. Lythgoe, filed herewith and numbered as [ANC-0042 - 0049]. 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 7 of 17 

Docket No. 16-09-14 
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• 

To slightly paraphrase DeSciose, the FAA can review RDM's complaint 

and evaluate allegations of unjust discrimination under the grant assurances only if both 

enterprises are characterized as aeronautical and were similarly situated. See FAA 

Docket No. 16-99-12, (December 13, 2001) (Final Decision and Order at 27). RDM, 

having alleged only general similarity between CargoPort's location, area and facilities 

and those AGLAD proposed, having submitted no evidence that either is an aeronautic 

user, but having given substantial indication that RDM and AGLAD are real estate 

developers, RDM has not made the minimal showing necessary to support Part 16 

jurisdiction. 

Even if RDM did make such minimal showing, it has not presented 

evidence sufficient to carry its burden of proof—even if Alaska DOT&PF had not 

presented contrary evidence—to show that RDM or AGLAD was similarly situated to 

another aeronautical user. See 41 North 73 West, Inc v. County of Westchester, FAA 

Docket 16-07-13, (September 18, 2009) (Final Decision and Order, p. 28) (respondent 

bears burden to show it is similarly situated on another FBO). On the contrary, Alaska 

DOT&PF has shown that this matter is all about real estate development, rather then 

aeronautical use subject to Part 16. To the extent neither RDM nor AGLAD were 

aeronautical users protected by the grant assurances, this matter should be dismissed 

because RDM lacks standing to seek review of matters not subject to Part 16 

jurisdiction. 

B. RDM Lacks ^'Directly and Substantially Affected" Standing 

In the very first paragraph of the section of its Answer to Motion to 

Dismiss entitled "Proof that RDM was 'directly and substantially affected,'" RDM 

alleges that Alaska DOT&PF's actions ""lead directly to the failure of AGLAD's 

development and the resultant loss" of an amount of money of which RDM "directly 

lost" a portion. See Answer to Motion to Dismiss at 1. Even if AGLAD were deemed 

an aeronautic user, RDM's own assertion is not that Alaska DOT&PF's actions 

"directly and substantially" affected RDM, as required under 14 C.F.R. § 16.23 but that 

Alaska DOT&PF's actions "lead to" the failure of AGLAD's development, which had a 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 8 of 17 

Docket No. 16-09-14 
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• 9 

"resultant" effect on RDM. RDM effectively admits that any effect Alaska DOT&PF's 

actions had on RDM was indirect, "resultant" from a direct effect on AGLAD. RDM 

does not meet the requirements for standing under Part 16. 

RDM goes on to admit to its less than one-third ownership of AGLAD, 

but for the first time, asserts that it is "deemed to have a 51 % Percentage Interest" in 

AGLAD "for voting purposes." See Answer to Motion to Dismiss at 2, ^ 5. Whatever 

that voting authority might mean—it is impossible to tell from RDM's selective 

provision of only the cover sheet and p. 3 of the AGLAD Operating Agreement—it 

apparently does not give RDM control of AGLAD. According to the organizational 

documents Alaska DOT&PF filed as ANC-0036 and 0040, AGLAD is managed by 

Alaska Global Logistics Airpark Development, Inc. RDM does not dispute that under 

AS 10.50.250(c), RDM lacks authority to act on behalf of or in the name of AGLAD; 

RDM does not purport to do so in this matter. Being either unable or unwilling to have 

AGLAD pursue claims on its own behalf, RDM filed its complaint only on its own 

behalf 

RDM asserts that it "was a very active member of AGLAD . . . and 

worked closely with Lee Nunn and Carol Meyers on the AGLAD Development." And 

that it "met several times with TSAIA." See Reply at 3 ^ 9. In reality, however, RDM 

admits that it was Debenham Properties, LLC, ("Debenham") that communicated with 

airport staff. See Reply at 4 ^ 16. Although RDM asserts that Debenham was its 

managing member, the October 24, 2008 correspondence from Debenham, made no 

mention that it was on behalf of any entity but itself See Exhibit C to Reply (first two 

pages)(also ANC-AGLAD-0198-0199). Neither did an October 29, 2008 email from 

Shaun Debenham as Vice President of Acquisitions and Development for Debenham, 

make any mention of RDM. [ANC-AGLAD-0378 - 0380]. It was only after the series 

of three meetings with ANC staff described at p. 3, 1| 9 of the Reply, that a 

November 25, 2008 letter from Debenham, indicated that it was on behalf of RDM. See 

Exhibit C to Reply (last two pages). 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 9 of 17 

Docket No. 16-09-14 
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Even so, as reflected in the two letters from Debenham, those dealings 

were not on behalf of AGLAD as a holder of an ANC lease, but on behalf of either 

Debenham or RDM as a prospective purchaser of Alaska Global Logistics Airpark 

Development, Inc's majority interest in AGLAD. Thus, the State of Alaska dealt 

directly with Debenham or RDM only as potential purchasers of a controlling interest in 

an airport tenant. Yet RDM makes no allegation that it had rights under law or the grant 

assurances in that capacity, and no allegation that any other similarly situated 

prospective purchaser of a controlling interest in an airport tenant received more 

favorable treatment from Alaska DOT&PF. 

Despite its assertions of direct interaction with ANC staff, all of RDM's 

allegations of wrongful conduct go to the lease terms and treatment of AGLAD. 

Although it appears to be the case that RDM briefly (from November 18, 2008 to 

December 31, 2008) had an option to acquire AGLAD, RDM chose not to exercise that 

option.^ Having declined its opportunity to take control of AGLAD, RDM never 

stepped into a position of sufficient authority to overcome the prudential reasons to 

deny standing to an indirectly affected party. 

Nevertheless, RDM's Answer to Motion to Dismiss goes to some length 

to summarize the allegations of its complaint, making a conclusory assertion that Alaska 

DOT&PF's failure to provide favorable treatment lead to the failure of "the AGLAD 

development." Thus, even if RDM's allegations had merit, which they do not, the 

Answer to Motion to Dismiss just reinforces that conclusion that RDM's loss would not 

be due to any direct effect of Alaska DOT&PF's actions on RDM, as asserted, but by 

the indirect effect RDM felt as an investor as AGLAD's proposed development failed. 

^ RDM incorrectly states that Alaska DOT&PF required documentation of 

the option before meeting with RDM representatives in October, 2008. According to 

RDM's own allegations, RDM met three times with ANC representatives, the last of 

which was November 17, 2008, see Answer to Motion to Dismiss at 2, paragraph 7. 

The option agreement was executed after that last meeting, on November 18, 2008. See 

Exhibit B to Answer to Motion to Dismiss. 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 10 of 17 

Docket No. 16-09-14 
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• 

See Answer to Motion to Dismiss at 3, ^^ 9 and 10. RDM has no standing to pursue its 

claims. 

RDM's citation to Martyn v. Port of Anacortes, FAA Docket No. 16-02-

03 (April 14, 2003) (Director's Determination, p. 46) is also misplaced. That case 

found standing: (a) under the lower standard specially crafted by the FAA with respect 

to revenue diversion {see Martyn pp. 46-47); (b) for an applicant who was an 

aeronautical user who sought, in part, to construct a hangar for his own use and that of 

his private investors {see Martyn p. 12 and 23); (c) whose direct and repeated efforts to 

lease airport land were denied {see Martyn p. 25); and (d) where the FAA found that the 

evidence demonstrated the airport sponsor's objection was based on a desire to limit 

growth of the airport {see Martyn p. 32). This case presents none of those 

circumstances. 

Martyn does, however, make clear that the FAA cannot award restitution 

or financial damages or under Part 16. See supra at 45-46. Although the FAA has 

jurisdiction to review compliance issues when presented by a party with standing, 

regardless of relief sought, it is inappropriate for the FAA to take up a matter presented 

by an entity only indirectly affected. Nothing in Martyn suggests otherwise. 

Although not cited by RDM's Answer to Motion to Dismiss, RDM does 

quote some standing language at page 34 of the RDM Reply, and Alaska DOT&PF 

deems it appropriate to distinguish the cited case: Centennial Express Airlines v. 

Arapahoe County Pub. Airport Auth., FAA Docket Nos. 16-98-05, 13-94-25, 13-95-03, 

(February 18, 1999) (Final Agency Decision and Order). 

Centennial Express deals with an airport operator's total ban on scheduled 

passenger service, clearly a core aeronautic use not at issue in the present matter, and 

clearly an issue the FAA had great interest in reaching through liberal application of the 

principles of standing. Indeed, because the FAA had found a violation early-on, by the 

time of the final agency decision was prosecuting the matter in its own name, 

effectively rendering the standing issue moot as to Mr. Kehmeier as a shareholder of 

Centennial Express, and the discussion concerning that issue administrative dicta. See 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 11 of 17 

Docket No. 16-09-14 
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Centennial Express at 9-10. Those differences, plus that fact that Centennial Express 

was originally filed as a Part 13 complaint under an apparently different standing 

standard before Part 16 came into existence, see Centennial Express at 8, footnote 7, 

fully distinguishes that case from this matter. 

There is every reason to apply the standing rules strictly in this matter 

brought by a real estate developer that held less than one-third interest in another real 

estate developer that failed to satisfy airport lease requirements to which it had agreed 

as a matter of contract. This case should be dismissed due to RDM's lack of standing. 

C. Contract Terms Not Prohibited By Law Or Grant Assurances, But Agreed 

To By AGLAD As A Matter Of Contract, Are Not Proper Subjects For 

Review Under Part 16. 

There is no question that Alaska DOT&PF must comply with 49 U.S.C. 

§47101 and the Sponsor Grant Assurances with respect to all aeronautical tenants. 

Alaska DOT&PF does so. Not only does RDM complain about treatment of AGLAD 

rather than of RDM, but the only way that treatment is alleged to be wrongftil is that it 

was allegedly less favorable to AGLAD than to other tenants. Yet all Alaska DOT&PF 

did was enforce the terms of the lease to which AGLAD freely agreed. FAA precedent 

demonstrates that the FAA will generally not find unjust discrimination in such 

circumstances. See Penobscot Air Services, Inc. v. Federal Aviation Administration, 

164 F.3d 713, (1st Circuit, 1999); 41 North 73 West, Inc v. County of Westchester, FAA 

Docket 16-07-13, (September 18, 2009) (Final Decision and Order, pp. 27-29); Moore 

V. Sumner County Regional Airport Authority, FAA Docket No. 16-07-16, (February 27, 

2009) (Director's Determination, p. 16)(citing Adventure Aviation v. City of Las Cruces, 

FAA Docket No. 16-01-14, (September 15, 2003) (Final Agency Decision and Order, p. 

24); Aerodynamics of Reading, Inc. v. Reading Airport Authority, FAA Docket No. 16-

00-03, (July 21, 2001) (Final Decision and Order, p. 16). 

RDM never alleges that any terms of AGLAD's lease was in violation of 

any specific prohibition or requirement of 49 U.S.C. § 47101 or the Sponsor Grant 

Assurances—only that Alaska DOT&PF had treated other tenants better. This 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 12 of 17 

Docket No. 16-09-14 
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important distinction defeats RDM's reliance on Maxim United, LLC v. Board of 

County Comm'rs, FAA Docket No. 16-01-10 (April 14, 2003) (Director's 

Determination, p. 46). In Maxim, the issue was not just differing standards, but 

standards that prevented complainant from self-fueling, in direct violation of Assurance 

22(f)- Indeed, Maxim goes on to note that differing treatment of different tenants over 

time is not in and of itself improper" 

[N]o Federal obligation requires a sponsor to forgo improved 

business practices or efficient allocation of airport property in 

order to avoid differing terms and conditions among users of the 

airport. The airport sponsor can pursue agreements that more 

nearly serve the changing interests of the public with the more 

recent leaseholders. 

Id. at 22 (citing Wilson Air Center v. Memphis and Shelby County Airport Authority, 

FAA Docket No. 16-99-10 (August 30, 2001) (Final Decision and Order); see, also 

Asheville Jet, Inc. v. Asheville Regional Airport Authority, FAA Docket 16-08-02 

(October 1, 2009) (Director's Determination) (identical tone and posture not required 

toward all competitors with different records and history with sponsor (citing Rick 

Aviation v. Peninsula Airport Comm'n, FAA Docket No. 16-05-18 (May 7, 2007) 

(Director's Determination at 16)); grant assurance does not require identical lease rates 

and terms to leases negotiated at different points in time (citing Aerodynamics of 

Reading, Inc. v. Reading Regional Airport Authority, FAA Docket No. 16-00-03 (July 

23, 2001) (Final Agency Decision)); Bisti Aviation, Inc. v. City of Farmington, FAA 

Docket 16-07-01 (December 4, 2007) (Director's Determination at 21) ("Federal grant 

obligations do not require Alaska DOT&PF to use antiquated leasing pracfices just to 

ensure that a prospective tenant today gets the same treatment another tenant got in the 

past.") 

Alaska DOT&PF has pointed out in ^ 18 of Exhibit A to Alaska 

DOT&PF's Answer at pages 22-27, that the other tenants to which RDM compares 

AGLAD were not at all similarly situated with AGLAD. Much had also changed in the 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 13 of 17 

Docket No. 16-09-14 
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airport's circumstances with respect to demand, land availability, airport finances. 

Alaska DOT&PF incorporates ^f 18 of Exhibit A to its Answer into this Reply. 

Inasmuch as none of the RDM's allegations go to specific requirements or 

prohibitions of 49 U.S.C. § 47101 or the Sponsor Grant Assurances, but only to 

comparative terms, the issue of whether RDM should be heard to object now to terms 

agreed to by AGLAD is directly at issue. This point both circles back to the standing 

question (RDM objecting to terms agreed to by AGLAD) and the parameters of FAA 

review of terms to which a party has agreed. Thus, if an aeronautic user's lease term or 

treatment were alleged to have directly contravened 49 U.S.C. § 47107(a) or a grant 

assurance without reference to any a term or decision applied to any other tenant, then 

perhaps it would be subject to Part 16 review—even if the complainant had agreed to it. 

But where the only issue is disparate treatment between tenants, then even for 

aeronautic users, "agreeing to differences in rights, restrictions, responsibilities and 

rents in agreements among existing FBOs necessarily supports the conclusion that the 

parties are not similarly situated for purposes of finding unjust economic 

discrimination." 41 North 73 West, Inc v. County of Westchester, FAA Docket 16-07-

13, (September 18, 2009) (Final Decision and Order, p. 28) (emphasis added). 

RDM suggests Alaska DOT&PF's citation of Roadhouse Aviation, LLC v. 

City of Tulsa, FAA Docket No. 16-05-08 (June 26, 2007) (Final Decision and Order, 

p. 20) stopped short of important language. Indeed, Alaska DOT&PF neglected to 

mention the Associate Administrator's view of the complainant argument that its 

"agree[ment] to abide by [the respondent's] unreasonable and unjustly discriminatory 

terms does not prove that it consented to them when it entered into the agreement. The 

Associate Administrator found that argument "not convincing," Id. at 20-21, stating 

"that the FAA is obligated to investigate possible violations of sponsor grant assurances 

. . . does not obligate the agency to find violations of grant assurances where none exist 

because a tenant no longer favors the terms of a lease it has freely undertaken." Id. 

RDM asserts, however, that "the City of Tulsa would have been found 

liable" regardless of Roadhouse Aviation's agreement to the terms of its lease if 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 14 of 17 

Docket No. 16-09-14 
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Roadhouse "had been able to show a violation of a grant assurance." Aside from the 

fact that the FAA has no jurisdiction to find airports "liable" to tenants, the point of 

Roadhouse is that a showing of differing terms and treatment agreed to by a party does 

not, as a rule, amount to a violation of a grant assurance where no specific prohibition or 

requirement is violated. As noted in Aerodynamics of Reading, Inc. v. Reading Airport 

Authority, FAA Docket No. 16-00-03 (Final Decision and Order, p. 16) (July 21, 2001): 

differing lease terms, alone, does not constitute evidence of unjust 

economic discrimination. Likewise, differing lease terms, in and of 

themselves, are not evidence that the differences resulted from 

reasons that were unjustly discriminatory. [FAA Order 5190.6A7 

Chapter 4, Sec. 4-14d(2)(a, b)] As required by Part 16, the 

proponent of a motion, request, or order - in this case, the 

Complainant - has the burden of proof. . . . Therefore, it was 

incumbent upon the Complainant to prove its allegations of unjust 

discrimination by providing evidence that similar terms and 

conditions were requested and were subsequently denied without 

adequate justification. 

For purposes of this motion to dismiss, Alaska DOT&PF's point is that RDM does not 

make the required initial showing necessary even to raise a good-faith issue as to 

possible economic nondiscrimination arising from enforcement of AGLAD's lease 

terms. 

Although RDM also asserts that Alaska DOT&PF's alleged 

discriminatory treatment extended beyond the original lease terms, effectively, it just 

points to Alaska DOT&PF's enforcement of those original terms rather than relaxing or 

renegotiating. The only allegation the Answer to Motion to Dismiss notes as neither an 

original lease term nor enforcement of an original term is that Alaska DOT&PF told 

RDM that ANC could not participate in project financing by owning the proposed 

AGLAD development. RDM provides no credible evidence either that it ever made 

such a request, or that Alaska DOT&PF responded in the manner alleged. What is 

clear, however, is that CargoPort had already constructed its facilities before it asked 

Alaska DOT&PF to take title for long-term financing. AGLAD never achieved that 

position. 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 15 of 17 

Docket No. 16-09-14 
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CONCLUSION 

RDM's complaint should be dismissed because 

A. RDM has no standing under Part 16 because as RDM has not 

demonstrated that either RDM or AGLAD are, or proposed to be, an aeronautic user or 

provider of aeronautic services. 

B. RDM has no standing as it was not "directly and substantially 

affected" by the alleged actions of the Alaska DOT&PF with respect to AGLAD. 

C. Contract terms not prohibited by law or grant assurances, but 

agreed to by AGLAD as a matter of contract, are not proper subjects for review under 

Part 16. 

RDM's Answer to Motion to Dismiss presents no facts or argument that 

effectively overcome the above reasons that RDM's complaint should be dismissed with 

prejudice. Alaska DOT&PF respectfully requests that the above matter be so dismissed. 

DATED this 29^^ day of December, 2009 at Anchorage, Alaska. 

DANIEL S. SULLIVAN 

ATTORNEY GENERAL 

By: 

Jonn L. Steiner 

senior Assistant Attorney General 

'ABA No. 8711108 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 16 of 17 

Docket No. 16-09-14 
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• 

Certificate Of Service 

I hereby certify that on December 29, 2009, I have this day served the 

foregoing REPLY TO RDM's ANSWER TO MOTION TO DISMISS on the 

following persons at the following addresses: 

Federal Aviation Administration 

Office of the Chief Counsel 

Attn.: FAA Part 16 Airport Proceedings Docket, AGC-610 

Room 925 

800 Independence Ave., S.W. 

Washington, D.C. 20591 

Shaun Debenham 

Managing Members of RDM, LLC 

2960 C Street, Suite 202 

Anchorage, AK 99503 

via: 

n hand delivery 

n faxed 

H mailed 

John L. Steiner 

Senior Assistant Attorney General 

Attorrtey General's Office 

Attorneys for Ted Stevens Anchorage International Airport 

Reply to RDM's Answer to Motion to Dismiss 

RDM, LLC V. ANC 

Page 17 of 17 

Docket No. 16-09-14