Opinion ID: 296613
Heading Depth: 1
Heading Rank: 1

Heading: Route Realignment and Comparative Determination

Text: 4 In June 1967 the CAB instituted the proceeding below to determine, first, whether the existing 15 segments of Southern's certificated routes should be realigned into six segments and, second, whether Southern's routes should be extended southward from Alabama and Tennessee into southern Florida. The CAB thus deliberately initiated a hybrid Investigation, part local service realignment and part new route authorization. This it was entitled to do. But the two phases of this Investigation are significantly different. 5 The first phase proposed realigning the routes of Southern, a local service carrier, to improve its operational flexibility and allow it to provide improved and more economical service between points in Alabama, Tennessee, Georgia, and northern Florida for which it was already certificated. These routes generally involved the servicing of traffic between numerous small cities in this area and the larger trading centers of Memphis, Birmingham, and Atlanta. However, in one segment of the realignment, Southern would have obtained authority to fly non-stop between Nashville and Atlanta, two large trading centers, in competition with trunkline carriers. 6 At no time in the proceedings was the realignment of the routes between the small cities serviced by Southern and the larger centers challenged. However, Delta's application for new authority between Atlanta and Nashville was consolidated in the realignment hearing for Southern in accordance with the Ashbacker 3 doctrine changing that facet of the realignment investigation to a comparative hearing. 7 The second phase of the Investigation involved new route authority for Southern from points on its existing routes to Miami via Orlando and Tallahassee, and other carriers, including Delta, had filed competing applications for this authority, which included the right to fly non-stop service between Memphis/Birmingham and Miami. Accordingly, from the outset this phase of the Investigation had all the characteristics of a comparative hearing. 8 After the Examiner's Initial Decision in September 1968, the Board in February 1969 issued an order which effected a complete separation of the competing applications from the unopposed realignment of Southern's routes to northern Florida. The Board approved all the route improvements, consolidations and realignments recommended by the Examiner for Southern, and added others. As to the competing comparative applications, the Board by the same order stayed the Examiner's Initial Decision and set these questions for full review by the Board. Thus, after this order the original hybrid Investigation was entirely a comparative application case involving Southern, Delta, and three other major carriers, 4 for non-stop authority on long-haul routes, between the largest market centers in the southeastern United States. 5 9 It is quite apparent that the inspiration for the original investigation was the desire of the Board to benefit Southern Airways, at least to the extent of getting it off subsidy, a laudable public service if this could be accomplished. A twin objective of equal importance was to provide additional and better service for the smaller cities in northern Florida, Tennessee, and Alabama. 6 The Board, to a varied degree, achieved both these aims by its order in February 1969 realigning Southern's existing route system to northern Florida. 10 But when it came to the granting of authority involving the lucrative non-stop routes servicing Memphis/Birmingham-Miami and Atlanta-Nashville, the praiseworthy aims of getting Southern off subsidy and providing better service to the smaller cities had to be evaluated as to chances of success in accordance with due process standards, and had to be balanced against other competing public and private interests, namely, the public interest of the needs of prospective passengers in the larger cities and the comparative capacities of the competing airline applicants to service these routes. 7 The failure of the Board was in not making these evaluations by accepted due process standards; and this failure, we think, did deprive Delta of the fair adversary determination to which it was entitled. 8