Application of 

BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, DC 

) 

) 

Original 

VIRGIN AMERICA INC. ) Docket No. DOT-OST-2011-0016 

) 

for waiver pursuant to Section 1-2 of Part 241 ) 

=o~ft=h=e~D=e~p=a~rt=m=e=n~t'~s~R=e~g=u=la=ti=o=n~s _____________ ) 

MOTION OF VIRGIN AMERICA INC. FOR LEAVE TO FILE AND 

REPLY TO ANSWER OF ALASKA AIRLINES, INC. 

Communications with respect to this document should be sent to: 

John Varley 

Senior Vice President & 

General Counsel 

Virgin America Inc. 

555 Airport Boulevard, Suite 500 

Burlingame, CA 94010 

(650) 762-7108 

(650) 762-7001 (fax) 

john. varlevra)virginamerica.com 

February 15,2011 

John E. Gillick 

Jonathon H. Foglia 

Zuckert, Scoutt & Rasenberger L.L.P. 

888 Seventeenth Street, N.W., Suite 700 

Washington, DC 20006 

Tel: (202) 973-7939 

Fax: (202) 342-0683 

jegillick@zsrlaw.com 

jhfoglia@zsrlaw.com 

Counsel for 

Virgin America Inc. 
r 

Application of 

VIRGIN AMERICA INC. 

BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, DC 

) 

) 

) Docket No. DOT-OST-2011-0016 

) 

for waiver pursuant to Section 1-2 of Part 241 ) 

=of~th=e~D~ep~a=rt~m==e=n~t'=s~R=e~g=u=la=t=io=n=s~ _____________ ) 

MOTION OF VIRGIN AMERICA INC. FOR LEAVE TO FILE AND 

REPL Y TO ANSWER OF ALASKA AIRLINES, INC. 

On February 9, 2011, Alaskal filed an answer in opposition ("Alaska Answer") to a 

petition of Virgin America ("Petition") to set aside a decision of the Director, Office of Airline 

Information ("Decision") that denied Virgin America's request to include operating results for a 

handful of Mexico flights within reports for Domestic operations under 14 C.F .R. § 241 (g). 

Virgin America now moves to file this Reply to the Alaska Answer and urges, for the reasons 

stated in the Petition and herein, that the Decision be reviewed and set aside and Virgin 

America's request for a waiver be granted forthwith. 

Motion for Leave to File Reply 

Virgin America moves for leave to file this brief Reply to the Alaska Answer, which 

attempted to obfuscate the issues raised by Virgin America's Petition and overlooked clear 

Departmental precedent. The filing of this Reply will not delay this proceeding and will assure 

that the Department will have a complete record upon which to decide this important Petition. 

I Common names of air carriers are used throughout this pleading. 
Alaska's Arguments Are Without Merit 

It is unfortunate that Alaska has filed an answer hoping to muddy the waters in this 

proceeding and distract the Department from the very limited scope of relief sought by Virgin 

America. Try as Alaska might to mischaracterize Virgin America's waiver request, however, 

Virgin America does not seek special or unusual treatment under the data submission 

requirements of Part 241. Rather, Virgin America has asked that its request be processed in 

accordance with established Departmental precedent regarding the interim classification of 

operating results for a geographic entity that comprises an exceedingly small portion of the 

applicant's overall flying. 

Alaska's argument that the Petition is a disguised effort to maintain confidentiality at the 

expense of data users' access is equally without merit. As the Department and other data users 

are well aware, given that the waiver would only apply to a handful of flights, the underlying 

financial performance metrics for those flights, including passenger unit revenue and unit costs, 

could still be approximated with a high degree of accuracy by utilizing Virgin America's system 

wide financial filings. Thus, Alaska's claim that the relatively small size of Virgin America's 

Mexico flying is "irrelevant" completely misses the point. To the contrary, it is because Virgin 

America's Mexico flights are so limited that the overall integrity of the system of accounts under 

Part 241 will be maintained; such a finding was critical to the Department's grant of a waiver to 

letBlue in 2004 and should be no less persuasive today. 

Similarly, Alaska's contention that "advances and improvements in computerized data 

collection and aggregation," Alaska Answer at 2, since the letBlue request in 2004 compel a 

different outcome utterly strains credulity. Nothing in the interim period has changed in terms 

2 
of the manner in which carriers establish and maintain separate systems of accounts, including 

categorizing operating results by geographic entity. 

Finally, Alaska has not provided any substantiation for its claim that a grant of the waiver 

would place Alaska at a competitive disadvantage. That Alaska did not request the same 

temporary waiver previously granted by the Department and sought by Virgin America today is 

of no consequence to the matter presently before the Department on review. 

The letBlue Waiver Decision Is Directly Applicable 

To Virgin America's Request 

As discussed in the Petition, the most serious deficiency in the Decision is the failure to 

even acknowledge, much less discuss, the Department's JetBlue waiver decision granting that 

carrier precisely the same relief sought by Virgin America in circumstances that were less 

compelling than those presented by the Virgin America waiver request. Alaska's efforts to 

discount the relevance and applicability of that decision are unavailing. 

The facts and circumstances concernmg letBlue's request for a WaIver and the 

Department's 2004 decision granting that request are directly applicable to, and provide a 

virtually identical precedent for, Virgin America's waiver request. As the Office of Airline 

Information is fully aware, letBlue filed its waiver request on May 25, 2004, indicating that it 

was about to commence service between the United States and the Dominican Republic with two 

daily roundtrip flights between New York and Santiago and one daily roundtrip flight between 

New York and Santo Domingo, or 21 weekly roundtrip flights estimated to be 1.5% of letBlue's 

system capacity. Since these flights represented such a small percentage of the letBlue system 

3 
capacity, letBlue requested a Waiver of the requirement that these operations be reported 

separately as a Latin American entity. 

In response, the Assistant Director of the Office of Airline Information granted the 

letBlue request on luly 29, 2004, permitting it "to report its two daily New York-Santiago, 

Dominican Republic flights and its one daily New York-Santo Domingo flight in the Domestic 

Entity." In support of the Department's decision to grant the waiver request under Section 

38S.19(c) of the Department's regulations, the Assistant Director stated that the "reason for the 

grant of the waiver is the very limited scope of letBlue's Latin America operations." Finally, the 

Assistant Director indicated that the "waiver will remain effective until letBlue increases service 

to the Latin America entity." 

As Virgin America pointed out in its Petition and contrary to the assertions in the Alaska 

Answer, Virgin America's waiver request was even more compelling than the letBlue request as 

the scope of Virgin America's Latin American operations (a total of only 13 weekly flights 

operated to Mexico versus the 21 weekly flights operated by letBlue to the Dominican Republic) 

is far more limited than that of letBlue. And, as was the case with the Department's letBlue 

decision, Virgin America fully understood that its requested waiver would last only until its 

"Latin American operations had grown to the point that it was in the public interest to report that 

information as a separate Latin American entity." Petition at Exhibit A. Thus, rather than 

attempting to seek "special dispensation" or "attempting to shield its data" to "gain an unfair 

competitive advantage" as suggested by Alaska, Virgin America is simply requesting the very 

same relief as was granted by the Department to letBlue until such time as Virgin America 

"increases service to the Latin American entity." 

4 
Under these compelling circumstances, the Department must, based upon its JetBlue 

precedent review and reverse the Decision in the manner specified in Part 385 of the agency's 

own regulations. 

WHEREFORE, for the foregoing reasons, Virgin America Inc. urges the Department to 

review the Decision and grant Virgin America' s request for a waiver as more fully described in 

its January 7, 2011, letter and January 3 L 201 L petition for review of staff action. 

February 15,2011 

Respectfully submitted, 

John E. Gillick 

Jonathon H. Foglia 

Zuckert, Scoutt & Rasenberger L.L.P. 

888 Seventeenth Street, N.W., Suite 700 

Washington, DC 20006 

Tel: (202) 973-7939 

Fax: (202) 342-0683 

jegillick(a)zsrlaw.com 

jhfogl ia@zsrlaw.com 

Counsel for 

Virgin America Inc. 

5 
CERTIFICATE OF SERVICE 

I hereby certify that a copy of the foregoing Reply and Motion of Virgin America Inc. 

was served this 15th day of February 2011, by electronic transmission, on: 

anne.suissa{Cl{dot. gOY 

steven.k.smitMv.dot.gov 

marshall.sinick@ssd.com 

charles.donlev@ssd.com 

jeffrev.manley(cVunited.col11 

hershel.kal11en@coair.com 

dan. weissW1coair.com 

sascha. vanderbellenW1delta.col11 

sametta.c. barnett@delta.col11 

jeff.morgan0:ldelta.com 

efabermanW1wrf.com 

howard kass@usairways.col11 

benjamin.slocum@usairways.com 

dkirstein@vklaw.com 

jhiIl(eV,dowlohnes.com 

mcmiIIinW1woa.com 

pmurphvW1Iolmurphy.com 

carl.nelson@aa.com 

Washington, DC