JetBlue Airways® | 27-01 Queens Plaza North | Long Island City, NY 11101 | 718-286-7900

 

January 24, 2014 

VIA HAND DELIVERY & OVERNIGHT 

Mr. Marc L. Warren , Esq. 

Acting Chief Counsel 

Federal Aviation Administration 

800 Independence Avenue, S.W. 

Washington, D.C. 20591 

 Re: Request of JetBlue Airways for a Waiver 

Dear Mr. Warren: 

 JetBlue Airways Corporation (“JetBlue”) requests a waiver from certain 

restrictions in the JFK Order Limiting Scheduled Operations at John F. Kennedy 

International Airport, 1 so that it can permanently transfer, via a mutual slot 

purchase agreement, 24 JFK operating authorizations (“slots”) to American 

Airlines, Inc. (“American”) in exchange for the permanent transfer of 16 DCA 

slots from American to JetBlue. Granting the waiver will make permanent an 

arrangement that has been in place since 2010 (“2010 Slot Exchange”), will 

assure the continued presence of JetBlue, a low cost carrier, at DCA, and will 

allow American to comply with the terms of a proposed settlement announced by 

United States Department of Justice (“DOJ”) on November 12, 2013.2

 The slots 

are listed in an attachment to this letter. 

 The transfer of these slots is required under the terms of a proposed final 

judgment (“PFJ”) between DOJ and the States of Arizona, Florida, Tennessee, 

and Michigan, the Commonwealths of Pennsylvania and Virginia, the District of 

Columbia, American and US Airways requiring that American offer to divest the 

16 DCA slots currently operated by JetBlue by making permanent the 2010 Slot 

Exchange.3

 See PFJ at IV.F.1, United States, et al. v. US Airways Group, Inc., et 

 

1

 73 Fed. Reg. 3510 (January 18, 2008), as amended; hereinafter, “JFK Order”. 

2

 The proposed settlement specifically refers to, and requires American to divest, 

the slots currently operated at DCA by JetBlue. See Proposed Final Judgment, 

United States, et al. v. US Airways Group, Inc., et al., No. 1:13-cv-01236 (D.D.C. 

Nov. 12, 2013), ¶¶ II.E, II.F & IV.F.1. 

3

 While JetBlue has the option of refusing to make the 2010 Slot Exchange 

permanent, American is required to offer the permanent transfer of slots and, if 

rejected by JetBlue, must then include the slots in the larger pool of slots to be 

divested on the open market. While JetBlue could refuse to exchange its JFK 

slots for DCA slots and instead try to negotiate a cash transaction, it could only 
Mr. Marc L. Warren, Esq. 

January 9, 2014 

Page 2 

al., No. 1:13-cv-01236 (D.D.C. Nov. 12, 2013), ECF No. 147-2. The DOJ 

believes that this divestiture, along with the others required by the terms of the 

settlement agreement, will “allow [LCCs and other carriers] to provide greatly 

expanded service on numerous routes, including new nonstop and connecting 

service to points throughout the country.” Competitive Impact Statement United 

States, et al. v. US Airways Group, Inc., et al., No. 1:13-cv-01236 (D.D.C. Nov. 

12, 2013), ECF No. 148 (“CIS”), at 9. 

 The JFK Order was issued in 2008 as a temporary measure to address 

the growing congestion at JFK airport that was, in part, a result of the January 1, 

2007 expiration of the High Density Rule4

 at JFK under the Wendell H. Ford 

Aviation Investment and Reform Act for the 21st Century.5

 The JFK Order was 

initially scheduled to expire October 24, 20096

 and specifically prohibited the sale 

of slots, instead permitting only the lease of slots, and then only through the end 

of the term of the JFK Order.7

 However, on May 21, 2008, the FAA published a 

notice of proposed rulemaking that was intended to replace the JFK Order.8 

Both the High Density Rule and the NPRM contemplated the sale of slots, and 

there is no reason to believe that the FAA intended to restrict the sale of slots at 

JFK over the long-term. The JFK Order has been extended without change 

several times, and the final rule addressing operations at JFK is unlikely to be 

issued in time to address the proposed settlement’s requirement that American 

offer to make permanent the 2010 Slot Exchange by offering JetBlue 16 DCA 

slots in exchange for the 24 slots currently held by JetBlue at JFK.9 

 The FAA has the statutory authority to grant the requested waiver. 

Section 40109 of the Transportation code authorizes the FAA to grant an 

exemption when the Administrator “decides the exemption is in the public 

interest.” 49 U.S.C. § 40109(b). The FAA will grant waivers when they are 

consistent with the public interest and will provide an equivalent or greater level 

 

do so at great risk to its continued operations because the settlement agreement 

only gives JetBlue priority with respect to making the existing agreement 

permanent and provides no preference for JetBlue in the event that the DCA 

slots are offered to multiple carriers. 

4

 14 C.F.R. 93.221. 

5

 49 U.S.C. 41715(a)(2)(2000). 

6

 The FAA has continued to extend The JFK Order, which is now set to expire 

October 24, 2014. 78 Fed. Reg. 28,276 (May 14, 2013). 

7

 73 Fed. Reg. 3510, 3516. 

8

 73 Fed. Reg. 29,626 (May 21, 2008), finalized on October 10, 2008 (73 Fed. 

Reg. 60,544) and rescinded October 9, 2009 (74 Fed. Reg. 52,134). 

9

 A notice of proposed rulemaking has been pending review at the Office of 

Management and Budget since March 9, 2013 

http://reginfo.gov/public/do/eAgendaViewRule?pubId=201304&RIN=2120-AJ89. 
Mr. Marc L. Warren, Esq. 

January 9, 2014 

Page 3 

of safety.10 Indeed, the FAA has previously granted a waiver of the analogous 

Operating Limitations at New York LaGuardia Airport in connection with the 2011 

slot swap transaction between Delta Air Lines and US Airways 11 and in 

connection with similar divestitures required by the PFJ.12 As explained more 

fully below, we believe a waiver from the JFK Order’s restriction on the sale of 

slots is warranted in this instance. Here, the FAA’s objective of safely and 

efficiently managing air traffic at JFK is preserved, and the public policy goal of 

promoting competition in air commerce and improved service to the traveling 

public continues to be enhanced. In addition, DOJ has called for the permanent 

exchange of the JetBlue slots at JFK and the American slots at DCA, noting that 

JetBlue offers service on a limited number of routes at DCA “through use of slots 

leased from American on terms that could be renegotiated or cancelled by the 

New American. Through the remedy...JetBlue will have the opportunity to obtain 

permanent access to the slots [it is] currently leasing from American, and ... will 

have the opportunity to acquire more slots at DCA... as well.” CIS at 8-9. 

 By approving this waiver, the FAA will allow American to fulfill a 

requirement under the PFJ that settles the litigation between the DOJ and 

American. More significantly for JetBlue, the waiver will allow it to make 

permanent an existing slot exchange that allows it to serve DCA. The 2010 Slot 

Exchange has resulted in considerable consumer benefits. Indeed, in the 

Complaint that initiated the litigation to enjoin the US Airways/American merger, 

the DOJ alleged that JetBlue’s entry into DCA “generated stiff price competition” 

and fares on the “Reagan National to Boston . . . route [in particular] have 

dropped dramatically.”13 Moreover, in granting a prior waiver, the FAA recognized 

 

10 The slot rules were adopted to improve efficiency and not for reasons of 

aviation safety. Thus, there is no need in this instance to demonstrate an 

equivalent or greater level of safety. In any case, it is clear that transferring slots 

from one scheduled air carrier to another, both of which are regulated under the 

same operational rules in 14 CFR part 121, will not have an adverse effect on 

safety. 

11 Petition for Waiver of the Terms of the Order Limiting Scheduled Operations 

at LaGuardia Airport, 76 Fed. Reg. 63,702 (Oct. 13, 2011) (“granting the joint 

waiver request of Delta Air Lines, Inc. (Delta) and US Airways, Inc. (US Airways) 

(together, the Joint Applicants or the carriers) from the prohibition on purchasing 

operating authorizations (slots) at LaGuardia Airport (LGA).”). 

12 Grant of Waiver at 3, In re the Petition of American Airlines, Inc. for a Waiver 

from the Order Limiting Operations at LaGuardia Airport, No. FAA-2013-1011-

0002 (December 2, 2013). 

13 Amended Complaint at ¶88 United States, et al. v. US Airways Group, Inc., et 

al., No. 1:13-cv-01236 (D.D.C. Sep. 5, 2013), ECF No. 73. 
Mr. Marc L. Warren, Esq. 

January 9, 2014 

Page 4 

the competitive benefits and pricing discipline resulting from low cost carrier 

competition—and competition from JetBlue specifically—at DCA.14 

 At JFK, American uses the JetBlue slots for a combination of domestic 

and international routes, competing with other large domestic and international 

carriers serving global markets. By expanding its international outreach at JFK 

with large, wide-body aircraft, American has been able to increase passenger 

throughput internationally without increasing the burden on air traffic control. 

 Likewise, JetBlue anticipates that the impact to the traveling public at DCA 

will be positive. After execution of the 2010 Slot Exchange, American 

significantly reduced the number of flights at DCA using smaller, regional aircraft. 

By removing those regional aircraft and replacing them with larger E-190 and A320 aircraft,15 JetBlue increased the average seats per arrival and departure at 

DCA. 

 The permanent exchange of these slots does not pose any operational 

concerns at JFK or DCA, having been implemented at both airports in 2010. The 

aircraft do not require any special handling by air traffic control that would require 

additional spacing or otherwise introduce delay at the airports. 

 Nor does the requested waiver prejudice any long-term FAA policy 

decisions relating to congestion management at DCA or JFK. Transfer of the 

JFK slots to American in exchange for the DCA slots held by American but used 

by JetBlue will give JetBlue and American the same rights that each carrier 

currently has as the slot holder at the respective airports – no more and no less. 

 A waiver is needed as soon as possible so that American can satisfy its 

obligations under the terms of the PFJ. The public policy considerations have 

been well explored by all parties to the litigation, including DOJ. In addition, 

granting the waiver will have no practical impact on the current operational 

makeup of the respective airports; rather, it will merely finalize an agreement that 

is currently temporary by virtue of the JFK Order. As such, JetBlue believes 

there is good cause to forgo a notice and comment period. 

 

 

14 76 Fed. Reg. at 63,705 (“We believe the transaction’s promised benefits for the 

public—particularly in light of the increased penetration of low cost carriers at the 

airports since the time of our last review—are sufficient for us to conclude that 

grant of the requested waiver with specified remedies is in the public interest.”). 

15 JetBlue’s E-190 aircraft seat 100 passengers, and its A-320 aircraft seat 150 

passengers. 
Mr. Marc L. Warren, Esq. 

January 9, 2014 

Page 5 

 In conclusion, the waiver is well justified and in the public interest. JetBlue 

respectfully urges the FAA to grant the requested relief as soon as possible, so 

that the parties can close their transaction. 

 Sincerely, 

 

 Robert C. Land 

Senior Vice President for Government 

Affairs & Associate General Counsel, 

JetBlue Airways Corporation 

cc: Howard Kass, Vice President of 

 Regulatory Affairs, American Airlines 
Transferred DCA Slots

Slot Time Slot Number

0700 1284

0900 1040

1000 1018

1100 1012

1200 1025

1200 1200

1300 1034

1300 1334

1400 1013

1500 1058

1500 1172

1700 1221

1800 1014

1900 1217

2000 1097

2000 1174

   
Transferred JFK Slots

Slot Time Slot Number Arrival (A) / Departure (D)

0630 21315 D

0630 21235 D

0700 21091 D

0730 21394 D

0800 21331 A

0900 21417 A

0900 21401 D

1100 21385 D

1230 21355 A

1300 20915 A

1400 21408 A

1430 21137 A

1500 21354 D

1600 21148 A

1700 21154 D

1800 21115 D

1900 21259 A

1900 20132 D

2000 21273 A

2030 21359 D

2100 21079 D

2130 21360 A

2200 21366 A

2230 21361 A