Murion of 

BEFORE THE 

DEPART!vlENT OF TRANSPORTATION 

OI7FfCE OF THE SECRETARY 

W ASHlNGTON, D.C. 

UNITED AIR LINES, INC. 

For Confidential Tre<Jtment 

Under Section 302.39 

Docket OST-95-675 

MOTION OF UNITED AIR UNE.S. INC. 

TO WITHHOLD INFORMATION 

FROM PUBLIC DlSCLOSlJRE 

Communications with rL:.-,}JCCl to this document .should be sent to: 

DAVID B. OLi\USSEN 

Managing Counsel 

UNITED AfR LINES, INC. 

77 W t;st Wacker Drive 

Chicago. IL 60601 

112-997-8069 

DATED: Octoh<:?r 17. :::o! 2 

21 IW 
Motion of 

BEFORE THE 

DEPART!vlENT OF TRANSPORTATION 

OFFICE OF THE SECRETARY 

WASHINGTON, D.C. 

UNITED AIR LINES. INC. 

For Confidential Treatment 

Unde-r Section 302.39 

Docket OST-95-675 

MOTION OF UNITED AIR LINES. INC. 

TO WITHHOLD INFORM A TlON 

FROM PUBLIC DISCLOSURE 

Pursuant to Rule 3l.)(e) of the Department of Transportation. Office of tht~ 

Secretary Procedural Rules, United Air Lines. Inc. ("United") hereby files this Motion to 

Withhold From Public Disclosure the information contained in a sealed envelope and captioned 

Schedule B-7 Airframe and Aircraft Engine Acquisitions and Retiretnents and delivered to the 

Office of Aviation Transportation Management. This information is provided pursuant to Part 

241 of the Department's Economic Regulations. 14 CFR 241. and is part of Form41 Schedule 

B-7. 

'rbe information sought to bt' withheld from public disclosure details United's 

acquisition cost ~mel ~ales realin1tion amounts with respect to new anJ used aircraft and aircraft 

engines. each broken down by model. individual serial number. and individual purchase or sale 

prices. The information for which United seeks nmfidcntial treatment under this inst~mt 

Motion is similar to and cunsistent with that fix which the Department granted. in 1993 and 

1994 orders. confidential treatment to similar Schedule B-7 data filed separately by United. 

American .Airlines. Inc. ("American'') and Delta Air Line'i. Inc. I"Delta"). 

The information sought to be \.Vithhc'ld falls within Ex~mplion 3 (Jf the Frcecl<Jrn 

of lnformati(lfl Act (.'1 U.S.C. S52(b){3)). which <:.~xcmpts from disclosure infonnation required 

by statute w be withheld. Exemption J provides that: 
provides that: 

''(b) This section docs not apply to matwrs 

that are. .. 

\ J) spccit1cally exempted from disclosure by statute (other than section 

552tb) of this title), provided that such statute (A) rt>quires that the 

matters be withheld from the public in such a manner as to leave no 

discretion on the issue. or (B) establishes particular criteria for 

withholding or refers to particular types of matters to be withheld:" 

ScctiGn 1104 of the Federal Aviation Act of I95X. as amended I the Act), 

·• Any J.h:~rson may make written objection to the public disclosure of inforrnation 

contained in any application. report, or document filed pursuant to the 

provisions of this Act ... stating the grounds for such objection. Any 

information contained in such app_licatiori. report. or document ... shall be 

witbheid from public disclosure by the ... Secretary of Transportation ... if 

disclosure of such information would ... adversely affect the competitive 

positi,ln uf any air carrier in foreign air transportation." 

United considers the requested information deleted from Schedule B-7 to be 

highly sensitive and confidential. The air transportation industry. both domestically and 

internationally, has become highly competitive. Aircraft ovvnership costs are a major cost of 

doing business for all <X~J1ificated carriers. A carrier's ability Lo reduce its aircraft mvnership 

costs relative to its competitors can. therefore, provide a carrier a significant competitive 

advantage. In an efkm to secure such an advantage. United applies considerable management 

resources to trying tnreduce it<> aircraft ownership cosh. This includes devoting substantial 

resources to trying w obtain airframes and engines at the lowest possible acquisition cost and 

disposing of these assets at the highest possible sales price. Moreover. the negotiations for new 

equipmenl are made rnorc difficult by the fact !hat there are only three manufacturers 1if birg,~ 

jet airframes and only three of large jet engines. However, as long as the Department makes 

available to the publi,: United's acquisition cost for each airframe and engine it acquires and tlw 

sales proceeds rcalizt~d on each ~ale of S!Il.~h equipment. llnited is denied the benefit of these 

efforts. harming United commercially. 

Once Lnitccl\ cost<:. arc divulged. United'.-, cnmpetitors can u-.c these cc~st data to 

negotiate contract price adjustments frcm the same suppliers United is using or from competing 

suppliers. Sinn~ nwn) of th,·;;c nm1pcting carriers arc foreign flag carri.:-rs. their ~.·quiprncnt 

prices will never ht• reponed to the Department. lel alone he made public. It is nor onl:; 

commercially damaging hut basically unfair ro United and ali other lL.o'i, ca!JicT?. tu !\'quirt~ 

' -..:., ... 
them to divulge to the.ir non-reporting foreign f1ag competitors the fruits of their competitive 

efforts with manufacturers to secure the best possible purchase price . .S.~ Q.~. Order X l-12-9. 

The di.c.closure of Uniled's purchases and dispositions of individual aircraft and 

aircraft engines \vould allow compeTing foreign and domestic airlines, manufacturers of aircraft 

and engines, and new and used aircraft owner/1c~sors ro calculate and closely track Unill-:d\ 

cnsts to inquire, modify. transfer or dispose of its various fleets of used models aircraft (and 

related used aircraft engines J. It would adversely affect United's competitive position by 

strengthening the haxgaining position of other airlines. including foreign airlim:s, and aircraft 

owner/lessors seeking to purchase aircraft equipment from manufacturers and others. They 

would be able to use their knowledge of United's confidential purchase and sale arrangements 

as starting points in th..:~ir own negotiations, and thus improve their ability to obtain equal or 

mt)re favorable prices. This would lead to United's competirors, including foreign competitors. 

being able to enjoy lower capital costs than otherwise the case, and to their being able 10 

operate and Cclrnpete more efficiently v.,·irh United than otherwise: 

United submits that F01A Exemption-~ is applicable, as a result ()J'the provision 

in Section ll 04 of the Act requiring the withholding from public disclosure of any information 

contained in a report filed pursuant to the Act if such disclosure \VOuld "adversely affect the 

competitive position of any air carrier in foreign air transponation" (49 U.S.C. App. 1504). 

The information for which United seeks confidential treatment under lhis instant Motion is 

similar to and consistent with that for which the Depa1tment granted confidential treatment, in 

(i) a March 29. 1993 order concerning similar Schedule B-7 data filed by Delta, ( ii) a 

November 1. 1993 order concerning similar Schedule B-7 data filed by American. fiii l a 

December 29. 1993 order concerning similar Schedule B-7 data filed by United, (iv l an August 

23. 1994 order concerning similar Schedule B-7 data filed by Delta. and (v) a November 18. 

1994 order concerning similar Schedule B-7 data filed hy United. The Department's grants of 

confidentiality were specifically made under Exemption 3 (and its J 993 grants were made 

exclusively under Ex<;:'mption :i) since Delta and American, like United, cornpele \l,'ith foreign 

air carriers who do n<JL rile such information yet are free to obtain U.S, carrier information from 

the Department. The Department there stated: 

"this lack or reciprocal access. the Department believes, could substantially harm the 

L~ompetitive pn..;irion of American, resulting in rhe erosion of the U.S. international 

airline indu<.try." 

United abo ::,ubmirs that the information sought w be withheld fall~ within 

t'\emption 4 from the Freedom of Information Acl. 5 U.S.C. 552~b)!4). \vhich provides 

protection trom disclosure for "trade secrets and comJnercial or financial information obtained 

frc~m a pers~)n and pri\ileg,~d or confidemia!: ... " tlnited believes the requested information 

deleted from Scheduie B-7 clearly satisfy all three dements required for protection under 

Exemption 4. Firs.t the acquisiticm cost and sak" realinuion mrKntnts report< . .'d arc subslantiatly 

!he same as neg,Jti;tkd ht~rween the parties. \vhich purchase and sale prices are clearly financial 

or commercial in natarl:. Second. United established these pr1c,~s thruugh its negotimions vvilh 

' --
private third pani,;s: the information was not obtained from any governmental t:'ntiries. Third. 

the disclosure of such information would harm United's competitive position. Sec Qulf & 

\Vestern Indus .. Inc. _y. United_.States, 615 F.2d 527 (D.C. Cir. 1979), National Parks & 

Conservation Ass'n v. ]\·lorton, 49X F.2d 765 (D.C. Cir. J 974). Sterling Drug. In~".J~_fr(irL~l! 

Trade Comm'n. 450 F.2cl698 (D.C.Cir. 1971), The Tinken Co. v. U.S. Customs Service. c191 

F.Supp. 557 (D.C. Cir~ 1980). Braintree v. Dept. of Ener2.v. 494 F.Supp. 287. and Burke 

Enen~v Cow.\·. Department of Enerl!v, 583 F.Supp. 507 tD. Karl. 1984). Finally. the 

Department's 1994 grants of confidentiality (i.e., its August 23. 1994 order concerning similar 

Schedule H-7/B-43 data filed by Delta. and its November 18, 1994 order COHl~eming sirnilar 

Schedule B-7 data fikd by United) were specifically rnade under both Exemptions 3 and 4. 

'fhc Department, when deciding United's (and American's and Delta's 

respecrive) prior B-7 confidentiality motions, granted a ten-year confidential period beginning 

on the date the information was required to be filed pursuant to 14 CFR 241.22(a). United 

deserves to be treated no less favorably with rL'spect to the sealed Schedule B-7 attached ht':rettL 

WHEREFORE, United requests that the Department, pursuant to Rule :w (lf its 

Rules of Practice and Exemptions 3 ancl4 of the Freedom of Information Act. withhold from 

public disclosure. the price infonnation contained in the Airframe and Aircraft Engine 

Acquisition and Retirements items v:hich have been de.leted from columns 9, 10 and I l of the 

public filing of United's quarterly Form 41 Schedule B-7 report for a period of not less than ten 

years. 

DATED: October 17.2012. 

Respectfully submitted. 

David B. Olaussen 

Managing Counsel 

UNITED AIR LINES. JNC.