Order: 2010-11-18

 Served: November 17, 2010

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

 OFFICE OF THE SECRETARY

 WASHINGTON, D.C.

Issued by the Department of Transportation

on the 17th day of November, 2010

________________________________________________

:

ALASKA AIRLINES, INC., ET AL. , :

: DOCKET NO. 

v. : OST-2007-27331

:

LOS ANGELES WORLD AIRPORTS, ET AL. :

:

SECOND ORDER GRANTING AN INTERIM STAY OF PROCEEDINGS AND 

EXTENDING DEADLINE

TO FILE PROCEDURAL COMMENTS

By this Order, the United States Department of Transportation (Department) 

grants the Complainants’ and Respondents’ September 24, 2010 Joint Motion to Change 

the Current Deadline in this Proceeding from October 18, 2010 to January 17, 2011

(Second Joint Motion) and to stay further proceedings in the case until January 17, 2011. 

This Order requires the parties to continue to file status reports of settlement discussions 

with the Department.

On November 24, 2009, the Department issued its Initial Request for Status and 

Comments (Order 2009-11-24) to initiate further proceedings in this case following the 

issuance of the mandate on September 25, 2009, by the United States Court of Appeals 

for the District of Columbia Circuit in Alaska Airlines, Inc., et al. v. U.S. Department of 

Transportation, 575 F.3d 750 (D.C. Cir. 2009). That case arose out of our Final Decision 
2

(Order 2007-6-8, June 15, 2007) issued under 49 U.S.C. § 47129 on the 

reasonableness of new terminal fees and new fee methodologies imposed on the Los 

Angeles International Airport, following a complaint filed by certain air carriers in 

Terminals 1 and 31(T1/T3 Carriers) against the airport operator, Los Angeles World 

Airports (LAWA). As explained in Order 2009-11-24, the D.C. Circuit remanded five 

issues for us to address.

On December 22, 2009, we issued our Order Amending Time to File Procedural 

Comments (Order 2009-12-17) inviting the parties to file, no later than January 18, 2010, 

written submissions on the five remanded issues. We also requested the parties to report 

periodically on the status of any settlement discussions. 

On January 7, 2010, we held a status conference call with LAWA and the T1/T3 

Carriers at which the parties advised us that they had reached agreement on one of the 

five remanded issues (that is, the timeliness of the T1 Carriers’ objection to fair market 

valuation) and that they intended to request an extension of the January 18 filing date of 

their submissions to October 18 in order to provide additional time to engage in further 

settlement discussions. On January 11, 2010, the parties filed their Joint Motion to 

Extend the Current Deadline in this Proceeding from January 18 to October 18 (First 

Joint Motion).

On January 21, by Order 2010-01-14 (First Order Granting Interim Stay), we

stayed the proceeding on remand until October 18 in order to encourage a local 

settlement of the remaining remanded issues. We also removed the one remanded issue, 

described in Paragraph No. 3 of Order 2009-11-24, upon which the parties had reached 

 

1

Southwest Airlines and US Airways operate out of Terminal 1. Alaska Airlines, AirTran Airways, ATA 

Airlines, Frontier Airlines, and Midwest Express operate out of Terminal 3.
3

agreement from the scope of the proceeding on remand. Further, we required the parties 

to provide status reports of settlement discussions every 60 days beginning March 18 

through September 18 in order to keep the Department apprised of the progress of the 

settlement. The parties have filed Joint Reports on the Status of Settlement Discussions 

(Joint Reports) on March 18 and May 17 as well as their latest report on September 24, 

all in accordance with the terms of our January 21 Order. 

In addition to describing meetings between LAWA and the airlines at LAX, the 

September 24 Joint Report stated that the parties are interested in resolving the four 

remaining remanded issues, particularly the T1 Carriers’ desire to make meaningful 

progress with LAWA in addressing their terminal-specific concerns. Additionally, 

LAWA maintains that progress is being made regarding airport-wide issues that may

render moot the T1 Carriers’ terminal-specific concerns and that it was continuing oneon-one discussions with several T3 Carriers. The parties further stated that they

anticipated the need for additional time to continue negotiations and referenced their joint 

motion requesting extension of the current deadline to January 17, 2011, filed 

concurrently with their September 24 Joint Report.

The T1/T3 Carriers and LAWA jointly moved to extend the deadline for filing 

written submissions on the remanded issues for an additional 90-day period, i.e., from 

October 18, 2010 to January 17, 2011 and to stay further proceedings in the case until 

January 17, 2011. In support of their motion, the parties stated that they have engaged in 

multiple meetings over the last nine months, filed the periodic reports we have directed, 

and, although they have not settled any of the four remaining issues, they remain 

interested in trying to resolve them among themselves, and anticipate the need for 
4

additional time to continue negotiations. The parties state that counsel for ACI-NA and 

for ATA have represented that neither ACI-NA nor ATA opposes the motion.

We are willing to grant the relief requested in the motion and wish to encourage a 

local settlement of the remaining remanded issues. We will continue to require the 

parties to provide a status report of settlement discussions during this time period, in 

order to keep the Department apprised of the progress of the settlement negotiations. The 

status report will be due on December 15. 

Accordingly, 

1. We grant the Joint Motion;

2. We stay the proceeding on remand until January 17, 2011, during which the Los 

Angeles World Airport (LAWA), on the one hand, and any or all of the T1/T3 

Airlines, on the other hand, will attempt to resolve the remaining remanded issues 

described in Order 2009-11-24 at 2-3, namely Paragraphs No. 1 (Airfield vs. nonairfield space), 2 (Other aeronautical uses of terminal space) , 4 (Burden of 

persuasion on rentable space) and 5 (Monopoly power);

3. We order the T1/T3 Carriers and the LAWA to file a written status report as to the 

progress of their settlement discussions by December 15, or by such earlier time 

as the Department may order as appropriate;

4. We hereby amend Ordering paragraphs 2 and 3 of Order 2009-12-17 as follows:

2. We invite the T1/T3 Carriers, the Los Angeles World Airports, the 

Airports Council International – NA, and the Air Transport Association, to 

file written submissions on the following: 1) whether the current record 

evidence on the remanded issues described in Paragraphs No. 1 (Airfield 
5

vs. non-airfield space), 2 (Other aeronautical uses of terminal space), 4 

(Burden of persuasion on rentable space), and 5 (Monopoly power) of 

Order 2009-11-24 at 2-3 is sufficient or requires supplementation; 2) what, 

if any, additional fact finding or evidence is contemplated and for which 

of the remanded issues described above; 3) the justification for such 

additional fact finding or evidence; 4) whether an oral evidentiary hearing 

is necessary to hear the new evidence, if any; and 5) any other procedural 

or evidentiary issues the parties wish to note, no later than January 17,

2011, if a settlement agreement of all the issues is not achieved by that 

date; and

3. We invite the T1/T3 Carriers, the Los Angeles World Airport, the 

Airports Council International – NA, and the Air Transport Association to 

file replies to the submissions described in Ordering paragraph 2, no later 

than January 27, 2011, if a settlement agreement is not achieved by

January 17, 2011. 

SO ORDERED

 

By:

 

CHRISTA FORNAROTTO

 Deputy Assistant Secretary for Aviation

 and International Affairs

(SEAL)

Dated: November 17, 2010

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

http://dms.dot.gov//reports/reports_ aviation.asp
6

OST-2001-27331

We served a copy of Order 2010-11-18 on the persons listed in this attachment.

SERVICE LIST 

U.S. DOT Dockets 

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E., 

Washington, DC 20590

James R. Weiss, Esq. 

Christopher S. Hunter, Esq. 

Thomas A. Reed, Esq. 

Megan H. Troy, Esq. 

Richard G. Price, Esq. 

Brian K. McCalmon, Esq. 

J. Timothy Hobbs, Esq. 

Kirkpatrick &Lockhart Preston Gates Ellis LLP 

1735 New York Avenue, N.W. Suite 500

Washington, DC 20006-5221

Jim.weiss@klgates.com;chris.huther@klgates.com;brian.mccalmon@klgates.com; 

megan.troy@klgates.com;richard.price@klgates.com;thomas.reed@klgates.com

TEL: (202) 628-1700; (202) 661-6225 FAX: (202) 331-1024; (240) 554-1487

Rana Aryan 

Kirkpatrick & Lockhart Preston Gates Ellis LLP

1900 Main Street, Suite 600

Irvine, CA 92614

TEL: (949) 253 0900 FAX (949) 253-0902 Rana.aryan@klgates.com

Steve S. Rosenthal, Esq. 

Jeffrey A. Tomasevich, Esq. 

Douglas A. Tucker, Esq. 

Jason J. Jarvis, Esq. 

J.D. Taliaferro, Esq. 

KAYE SCHOLER LLP 

901 Fifteenth Street, N.W., Suite 1100

Washington, DC 20005-2327

srosenthal@kayescholer.com;jtomasevich@kayescholer.com;dtucker@kayescholer.

com;jjarvis@kayescholer.com;jtaliaferro@kayscholer.com

TEL: (202) 682-3553; (202) 682-3537 FAX: (202) 682-3580; (213) 612-1545(LA) 

(202) 414-0408
7

Roy Goldberg

Courtney Sheehan

Sheppard, Mullin, Richter & Hampton 

1300 I Street, N.W., Suite 1100 East 

Washington, DC 20005-3314

rgoldberg@sheppardmullin.com;csheehan@sheppardmullin.com

TEL: (202) 218-0007; (202) 772-5360 FAX: (202) 312-9425; (202) 312-9424

Kelly Martin, Esq. 

General Counsel of LAWA

Ray Ilgunas, Esq. Supervising Attorney, Airports Division 

Carmen A. Trutanich, City Attorney for the City of Los Angeles

Lynn Mayo, Esq. Deputy City Attorney 

City of Los Angeles Attorney’s Office 

Los Angeles World Airports 

One World Way 

Los Angeles, CA 90045

Kellymartin@lawa.org; 

rilgunas@lawa.org;;lmayo@lawa.org;c.trutanich@lacity.org 

TEL: (424) 646-5010; (213) 978-8100 FAX: (424) 646-9617

David A. Berg, Esq. 

Vice President & General Counsel 

Katherine Andrus, Esq. 

Assistant General Counsel 

Airport Transport Association of America

1301 Pennsylvania Avenue, NW 

Washington, DC 20004

dberg@airlines.org; kandrus@airlines.org

TEL: (202) 626-4234 FAX: (202) 626-4139

Robert P. Silverberg, Esq. 

Claire L. Shapiro 

L. Jeffrey Johnson

Silverberg, Goldman & Bikoff, LLP

1101 30th Street, N.W. Suite 120

Washington, DC 20007

rsilverberg@sgbdc.com; cshapiro@sgbdc.com

TEL: (202) 944-3300 FAX: (202) 944-3306

Robert Span 

Paul, Hastings, Janofsky & Walker LLP

25th Floor 

515 South Flower Street 

Los Angeles, CA 90071

robertspan@paulhastings.com

TEL: (213) 683-6253 FAX: (213) 996-3253
8

Lorraine B. Halloway, Esq. 

Gerald F. Murphy, Esq. 

Crowell & Moring LLP

1001 Pennsylvania Avenue, N.W. 

Washington, DC 20004-2585

Lhalloway@crowell.com

TEL: (202) 624-2538 FAX: (202) 628-5116

Robert E. Cohn, Esq. 

Patrick R. Rizzi, Esq. 

Hogan & Hartson, LLP 

555 13th Street, N.W. 

Washington, DC 20004

recohn@hhlaw.com; prrizzi@hhlaw.com 

TEL: (202) 637-4999 FAX: (202) 637-5910

Joseph P. Zang, Director - Assistant General Counsel 

Susan L. Smith, General Attorney

Delta Air Lines, Inc. 

Law Department #981 

1030 Delta Boulevard 

Atlanta, GA 30320

joe.zang@delta.com; sue.smith@delta.com

TEL: (404) 715-2433 FAX: (404) 715-2233

Bruce Rabinovitz, Esq. 

Neil J. King, Esq. 

Wilmer Cutler Pickering Hale and Dorr LLP 

1875 Pennsylvania Avenue, N.W. 

Washington, DC 20006

Bruce.rabinovitz@wilmerhale.com;neil.king@wilmerhale.com

TEL: (202) 663-6960 FAX: 663-6363

Ricks Frazier

Assistant General Counsel 

United Air Lines, Inc. 

P.O. Box 66100 –WHQLD 

Chicago, IL 60666

Ricks.frazier@united.com

TEL: (847) 700-4446 FAX: (847) 700-4683

Scott P. Lewis

Anderson & Kreiger LLP 

One Canal Park, Suite 200

Cambridge, MA 02141

slewis@andersonkreiger.com

TEL: (617) 621-6560 FAX: (617) 621-6501
9

Monica R. Hargrove, General Counsel 

James I. Briggs, Jr., Assistant General Counsel

Airports Council International – North America

1775 K Street, N.W. 

Washington, DC 20006

mhargrove@aci-na.org; jbriggs@aci-na.org

TEL: (202) 861-8088; (202) 293-8500 FAX: (202) 331-1362

Nancy Kessler, Esq. 

Office of General Counsel 

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E. 

Washington, DC 20590

Nancy.kessler@dot.gov

TEL: (202) 366-9287 FAX: (202) 493-0154

The Honorable Richard C. Goodwin

Administrative Law Judge

Office of Hearings, M-20, Room 5411

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E. 

Washington, DC 20590

Richard.goodwin@dot.gov;ira.leibowitz@dot.gov;patricia.matthews@dot.gov

TEL: (202) 366-2139; (202) 366-2139 Legal Assistant (202) 366-5121 FAX: (202) 

366-7536
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The Honorable Rosalind A. Knapp 

Deputy General Counsel 

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E., W92-312

Washington, DC 20590

Lindy.knapp@dot.gov 

TEL: (202) 366-4713

Paul M. Geier

Assistant General Counsel for Litigation 

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E., W94-310

Washington, DC 20590

Paul.geier@dot.gov

TEL: (202) 366-4731

Christa Fornarotto

Deputy Assistant Secretary for Aviation 

 And International Affairs

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E., W88-324 

Washington, DC 20590

Christa.fornarotto@dot.gov

TEL: (202) 366-4551 

Dana Gresham 

Assistant Secretary for Governmental Affairs

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E., W85-332

Washington, DC 20590

dana.gresham@dot.gov

TEL: (202) 366-4573

Jill Zuckman 

Assistant Secretary and Director of Public Affairs

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E., W93-310

Washington, DC 20590

Jill.zuckman@dot.gov 

TEL: (202) 366-4570

Bill Mosley

Public Relations 

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E., W93-501

Washington, DC 20590

Bill.mosley@dot.gov 

TEL: (202) 366-5582