Home | Search | Help
OST by Number | OST by Order | OST by Carrier | OST by Subject | OST by Day
OIA by Carrier/Subject | OIA by Day | FAA by Number | FAA by Subject | FAA by Day
Carrier Financials | Charter Office | Answer/Reply Calendar
Updated:
OST-2007-27331 - Respondent's Pleadings
Inital Complaints and Scheduling Notice
Complainants' Pleadings - Terminal 1 and 3 Airlines (Alaska Airlines et al. v. LA World Airports et al.)
Complainants' Pleadings - Tom Bradley International Terminal Airlines (Aer Lingus at al. v. LA World Airports
Intervenors' Pleadings
Chronological Listing
Department Notices
Department Orders
Prehearing Conference and Hearing Transcripts
|
March 2, 2007 Respondents' Brief in Opposition - Bookmarked Respondents' Motion to Dismiss Foreign Air Carriers
March 2, 2007 Respondents' Answer to Joint Complaint Filed February 16, 2007 Respondents' Answer to Joint Complaint Filed February 23, 2007
March 2, 2007 Certificate Required by 14 CFR 302.60
Respondent's Exhibits
Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 5, 2007 Respondents' Motion for Leave to File Two Documents Inadvertently Omitted from Previous Filings Pursuant to 14 C.F.R. § 302.6(c), Respondents Los Angeles World Airports, the Los Angeles Board of Airport Commissions, and the City of Los Angeles respectfully request that the Department grant leave to file the two documents attached to this motion. The documents are (A) LAX-6-0001, which should have been included as the first page of exhibit LAX-006, Dkt. No. OST-2007-27331-12; and (B) the resume of Garfield S. Eaton, which should have been attached to the Declaration of Garfield S. Eaton, (docket number pending). Because of clerical error, both documents were inadvertently omitted from Respondents' filings of March 2, 2007. A copy of both documents was provided by electronic mail to counsel for the Airlines at 12:42 p.m. today, when the omissions were first noticed. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholar.com
March 6, 2007 Declaration of Garfield S. Eaton
March 8, 2007 Respondents' Notice of Compliance with the Credit Facility Requirement Respondents hereby provide notice of their compliance with the credit facility requirement of 49 U.S.C. § 47129(d)(1)(C)& (D). Copies of the two Letters of Credit issued today, showing beneficiaries designated by the Complainants and the Add-On Complainants, are attached hereto. The Letters of Credit were delivered today to the designated beneficiaries. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 9, 2007 Respondents Los Angeles World Airports, Los Angeles Board of Airport Commissioners and the City of Los Angeles oppose the unprecedented petitions of five airlines at Los Angeles International Airport American Airlines, Inc., Continental Airlines, Inc., Delta Air Lines, Inc., Northwest Airlines, Inc., and United Air Lines, Inc. to intervene in these proceedings. To our knowledge, no airline that has provided service at a subject airport has ever sought to intervene in a § 47129 proceeding (as opposed to file as an Add-On Complainant), and certainly DOT has not permitted such intervention in any prior § 47129 proceeding. LAWA opposes the five petitions on the following grounds:
While LAWA vigorously opposes the five airlines' petitions to intervene and urges that their petitions should be denied, if DOT determines that a "significant dispute" is presented and is inclined to grant the petitions, in whole or in part, DOT should make clear that each of the interveners would become subject to being required to present witness testimony and documents during the proceeding on issues presented in the Instituting Order. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 12, 2007 The cases that Complainants and Foreign Complainants reply upon do not support their position. 10 In both Delta Air Lines, Inc. v. Lehigh-Northampton Airport Auth. and Continental Micronesia v. Commonwealth of the N. Marianas Islands, the Secretary found that "the existence of a written agreement signed by the proper parties, for a term certain, containing standard and customary clauses, is to be regarded as a 'written' agreement within the meaning of the statute. As discussed above, until Complainants' leases were terminated as of 11:59:59 pin on January 31, 2007, LAWA's imposition of M&O charges, including the increase in M&O charges retroactive to January 1, 2006, was done before Complainants' leases expired and therefore the charges were imposed pursuant to Complainants' leases. And until the Foreign Complainants' leases expire on March 31, 2007, LAWA's imposition of M&O charges, including the increase in M&O charges retroactive to January 1, 2006, is done pursuant to their still-valid leases. Finally although both Complainants and Foreign Complainants cite Delta, they both neglect to mention that the fees set by the Airport Authority in that case were "subject to revision and adjustment within 120 days after the end of the fiscal year," the same kind of "revision and adjustment" that gave rise to their complaints here, LAX-0090002 ("Each year on January 1st, LAWA assess proposed M&O Rents which are based on actual audited expenses from the prior fiscal year."). Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 12, 2007 Needless to say, Respondents Los Angeles World Airports, Los Angeles Board of Airport Commissioners, and the City of Los Angeles disagree with nearly everything that the Foreign Complainants assert in their Answer To Respondents' Motion To Dismiss Add-On Complaint Because Foreign Air Carriers Are Improper § 47129 Complainants. Given the strict time-constraints of § 47129 proceedings, however, instead of providing a pointby-point rebuttal of every argument in their Answer, LAWA only addresses their most egregious misstatements. First, the Foreign Complainants' assertion that the "The Newark Decision Is Not Final," Answer at 6, is overly simplistic and therefore misleading. While it is technically true that the opinion in The Port Authority of NY& NJ v. DOT, 2007 WL 623637 is not final until the mandate issues, that is wholly irrelevant to the fact that the opinion has full legal effect right now. Second, it is again overly simplistic and therefore misleading for the Foreign Complainants to suggest that the Secretary has discretion not to follow The Port Authority decision. If the Secretary were to find that a significant dispute exists and yet permit the Foreign Complainants to participate in this proceeding, LAWA would certainly seek review of that decision - either by a mandamus action after an Instituting Order is issued or by a petition for review after the DOT proceedings end - in the D. C. Circuit. The D.C. Circuit reviewed the first two LAX rate cases, and there is no reason to believe that it will not review this one, too (if the Secretary finds that there is a significant dispute). Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 19, 2007 In an outrageous violation of the Secretary's clear and unambiguous order that "[w]e will not accept petitions for reconsideration of this order," the T1/T3 Carriers have filed just such a petition. See Motion of T1/T3 Airlines for leave to File an Otherwise Unauthorized Document, And Request Correction of Significant Factual Error In Instituting Order. The T1/T3 Carriers apparently believe that the "factual error" they claim to have identified justifies violating the Secretary's order. It does not. The Instituting Order recognized that these proceedings are far too expedited to permit the 39 parties - 7 T1/T3 Carriers, 22 TBIT Carriers, 3 Respondents, 5 Intervenor Carriers, ACI-NA and ATA - to file petitions for reconsideration. Even grouping the parties together, there are six groups of parties the T1/T3 Carriers, the TBIT Carriers, the Respondents, the Intervenor Carriers, ACI-NA and ATA - each of which would probably like to petition the Secretary to reconsider one or more aspects of the Instituting Order. It is not practically possible to do so in the limited time before the hearing begins next Monday. For all of these foregoing reasons, Respondents Los Angeles World Airports, Los Angeles Board of Airport Commissioners, and the City of Los Angeles are not responding to the substance of the T1/T3 Carriers' ill-conceived Petition for Reconsideration and respectfully request that the Secretary reject the TI/T3 Carriers' Motion for Leave to File and refuse to accept its Petition for Reconsideration for filing. If the Secretary does not do so, then Respondents respectfully request that the Secretary (1) provide Respondents an opportunity to submit a substantive opposition; and (2) establish a briefing schedule for Respondents (and all other parties) to file their own petitions for reconsideration, as there are aspects of the Instituting Order which Respondents believe are based on alleged "significant factual errors" which could result in "a final Department decision that is fundamentally flawed." Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 19, 2007 Respondents' Motion To Require All Parties To Refile Testimony Los Angeles World Airports, Los Angeles Board of Airport Commissioners, and the City of Los Angeles respectfully moves that the Court order all parties to refile direct testimony redacting all testimony that refers or relates to issues excluded by the Instituting Order. The grounds for this motion are simple. The T1/T3 Carriers and the TBIT Carriers raised issues in their complaints - and submitted testimony on those issues - that the Instituting Order excluded from the hearing. Since those issues are no longer in the case, it is unnecessary - and would be inappropriate - for the Court to consider that testimony. In addition, granting this motion would be consistent with and help implement the Secretary's instruction in the Instituting Order that "{w]e ask the AU to disregard certain aspects of the pleadings in the course of admitting evidence and testimony in the proceeding." Accordingly, LAWA respectfully requests that its Motion To Require All Parties To Refile Testimony be granted and that each party refile (and reserve) their declarations, appropriately redacted, by 5:00 pm EDT March 21, 2007. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 19, 2007 The Instituting Order in this proceeding directed the ALJ to determine whether or not to order additional document production from LAWA to the T1/T3 Carriers and/or the TBIT Carriers. The IO, however, did not address whether the Airlines should be required to produce documents to LAWA that LAWA needs to prepare its defense. For the reasons which follow, LAWA respectfully requests that the Court permit LAWA to serve limited document requests on the T1/T3 Carriers and the TBIT Carriers and to require them to produce all responsive documents by 5 PM EDT on March 22, 2007 (the same day that the Court's Order on Discovery, issued March 16, 2007, requires LAWA to produce any additional documents or state why such items cannot be produced). The information that LAWA requests the Airlines to produce is in their possession, is highly relevant to the issues set for hearing by the Secretary in the Instituting Order, and the Airlines made none of this information available to LAWA before they filed their complaints. Accordingly, LAWA submits that good cause exists to grant its motion and respectfully requests that the Court order the Airlines to produce documents as provided in the attached form of Order. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 19, 2007 Respondents' Motion To Require The Airline Intervenors To Respond To LAWA's Narrow Document Requests The Instituting Order in this proceeding directed the ALJ to determine whether or not to order additional document production from LAWA to the T1/T3 Carriers and/or the TBIT Carriers. The IO, however, did not address whether the airlines whose motions to intervene were granted should be required to produce documents to LAWA that LAWA needs to prepare its defense. For the reasons which follow, LAWA respectfully requests that the Court permit LAWA to serve limited document requests on the Intervenor Carriers and to require them to produce all responsive documents by 5 PM EDT on March 22, 2007 (the same day that the Court's Order on Discovery, issued March 16, 2007, requires LAWA to produce any additional documents or state why such items cannot be produced). The information that LAWA requests the Intervenor Carriers to produce is in their possession, is highly relevant to the issues set for hearing by the Secretary in the Instituting Order, and none of this information was available to LAWA before the T1/T3 Carriers and the TBIT Carriers filed their complaints. Accordingly, LAWA submits that good cause exists to grant its motion and respectfully requests that the Court order the Intervenor Carriers to produce documents as provided in the attached form of Order. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 20, 2007 Motion of Respondents' For Leave To File An Unauthorized Document Respondents Los Angeles World Airports, Los Angeles Board of Airport Commissioners, and the City of Los Angeles seek leave to file the attached "Reply To The TBIT Airlines' Response Seeking Not To Produce Witnesses For Cross Examination." As discussed in the Reply, the TBIT Carriers' position that they should not be required to produce each of its witnesses for cross-examination would deny LAWA its due process rights to cross examine testifying witnesses. Contrary to the TBIT Carriers' suggestion, LAWA does not seek to cross-examine their witnesses on standing (an issue decided by the Instituting Order), but on issues that their witnesses have affirmatively raised in their declarations including, but not limited to, issues that go to the veracity of the witnesses and the truthfulness of their testimony. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 20, 2007 In a submission that is "stunning in its audacity" the TBIT Complainants demand that LAWA produce all of its witnesses for cross examination at the hearing, but suggest that they should not have to produce each of their witnesses because it "would save a great deal of hearing time and witness inconvenience" if their 21 witnesses are not required to appear. Los Angeles World Airports, Los Angeles Board of Airport Commissioners, and the City of Los Angeles strongly disagree. The TBIT Carriers would have this Court believe that the declarations that their 21 witnesses submitted are plain vanilla statements such that there is no real need for cross examination. The TBIT Carriers admit, however, that that is not really true by asserting that the declarations were submitted "primarily to establish the required standing for challenging the imposition of the new M&O charges." While LAWA notes that its intended questioning of the TBIT Carriers' witnesses is not dependent on the need to raise issues affirmatively that are not raised in their declarations, LAWA also notes that the T1/T3 Carriers have asserted in correspondence with LAWA that they might seek to go outside the scope of our witnesses' direct testimony in their declarations by calling our witnesses in their case-in-chief. That practice is not permitted by the Court's Ground Rules. If that is to be permitted, however - and LAWA certainly is not conceding that it should be - that, of course, provides an additional ground for each of the T1/T3 and TBIT witnesses to be present. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 21, 2007 Respondents' Opposition to Complainants' Joint Motion to Permit Duelling Cross-Examinations As to the issue of whether the increase in M&O fees have been imposed pursuant to a written agreement, there can be little difference, either. While it is true that the T1/T3 Carriers' leases expired, they do not contest that LAWA's imposition of retrospective M&O charges cover a period during which they were occupying terminal space pursuant to the terms of those expired leases. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3553, srosenthal@kayescholer.com
March 21, 2007 Respondents' Opposition to TBIT Carriers' Motion for Limited Discovery Apparently unsatisfied with the scope of the issues for hearing stated in the Instituting Order, which directed the ALJ "to limit his findings with respect to the TBIT Carriers' Complaint to whether the M&O fees... are reasonable and not unjustly discriminatory," the TBIT Carriers' motion for limited discovery now seeks information that is obviously related only, if it is related to anything, to the amount of the terminal base rent. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3553, srosenthal@kayescholer.com
March 22, 2007 While the T1/T3 Carriers may certainly request that the Court issue a subpoena, the purpose for which they seek this subpoena is entirely inappropriate. Indeed, as shown below, the purpose is oppressive, vexatious, burdensome, and unnecessary. Accordingly, it should be denied. LAWA has been quite clear that Ms. Tubert will appear to testify at the hearing. Indeed, the e-mail which the T1/T3 carriers attached to the Subpoena Application as Exhibit 1 specifically so states: "I can assure you, however, that LAWA does intend to make Patty Tubert available for cross-examination and, therefore, she will be physically present at the hearing." LAWA also represented to the Court, in "Respondents' Reply to the TBIT Airlines' Response Seeking Not To Produce Witnesses For Cross Examination," specifically that "LAWA also notes that it intends to produce each of its witnesses for cross examination at the hearing." Thus, the T1/T3 Carriers can have no legitimate concern that Ms. Tubert will not be available to be cross-examined at the hearing. Indeed, the T1/T3 Carriers admit that they are not really concerned that they will not be able to cross-examine Ms. Tubert - they want this Court to issue a subpoena to compel her to testify at least twice - once as a witness in their case-in-chief in addition to testifying on cross-examination. Indeed, Complainants' collective goal is actually to require Ms. Tubert to testify three times, as the T1/T3 Carriers and TBIT Carriers have a separate motion to permit them to have separate lead counsel at the hearing, and the TBIT Carriers, by letter, have indicated that they will seek to have Ms. Tubert testify in their "case-in-chief." Thus, if the Court grants Complainants' request to have separate lead counsel for the T1/T3 Carriers and the TBIT Carriers, it is clear that Complainants will seek to have Ms. Tubert testify three times In LAWA's view, that is the definition of vexatious. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3553, srosenthal@kayescholer.com
March 22, 2007 Respondents' Proposed Agenda For Prehearing Conference For the assistance of the Court, we have prepared a proposed agenda for the Prehearing Conference listing the pending motions in the order submitted by the various parties together with any responses filed. Your Honor, may, of course, have additional topics that he will wish to discuss at the Prehearing Conference and by submitting this proposed agenda, we do not wish to limit the topics Your Honor may wish to raise. Respondents have not been informed by any other party of any topics that they intend to raise at the Prehearing Conference beyond the below listed pending motions. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3553, srosenthal@kayescholer.com
March 22, 2007 There was an inadvertent error on the second page of the Proposed Agenda for Prehearing Conference and I would request that the enclosed page 2 be substituted for the previous page 2. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3553, srosenthal@kayescholer.com
March 22, 2007 Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 22, 2007 Respondents' List of Direct Testimony
Each of these Declarations was filed on March 2, 2007, by LAWA in support of its opposition to the Complaints filed by the T1/T3 Carriers and the TBIT Carriers in this matter. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 22, 2007 Respondents' Production of Information Pursuant to Order on Discovery With the exception of one exhibit, LAX-079, all the information produced hereby was provided to or available to the airlines at LAX in 2006 at the latest, months before the commencement of these proceedings. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 22, 2007 Respondents' List of Witnesses
Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 23, 2007 Respondents' Disclosure of Information Pursuant to the Court's March 22, 2007 Order Information responsive to the requests is presented in the attached schedules which set forth the methodology used to determine debt service on TBIT. As is the case every year, the predicted fiscal year numbers are subject to change. LAWA performs a reconciliation every year whereby any overcharge to the airlines is credited back to them (and any undercharge is charged to them). LAWA notes that the attached schedules do not reflect a budget variance in the debt service amounts that was identified during one of the two semi-annual Landing Fee reconciliation discussions which took place last month. That budget variance will be corrected, along with other budget variances, during the final reconciliation for FY2007 (which ends June 30, 2007). Accordingly, while the numbers in these spreadsheets are subject to change, the methodology is not. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
March 23, 2007
Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
April 9, 2007 The Complainant Terminal 1 and 3 airlines, on the one hand, and the Respondents Los Angeles World Airports, et al, on the other hand, hereby stipulate to the following:
Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3553 for Respondents / Sheppard Mullin, Roy Goldberg, 202-218-0000 for T1/T3 Airlines
April 27, 2007 Brief of Respondents: Proposed Findings of Fact and Conclusions of Law Independently of their discrimination claim, the Airlines could be understood to be challenging LAWA's newly adopted practice of calculating terminal rents based on a rentable space divisor in place of the previous usable space divisor. LAWA has established that use of a rentable space divisor is common at other airports and in nearly exclusive use in the commercial leasing world. LAWA has also established that its use of rentable space is motivated by its understandable interest in having airlines pay their pro-rata share of common terminal space (i.e., in proportion to the square footage they occupy). So, the Airlines have established no grounds for criticism of rentable space per se. In any event, the issue is entirely one of a fee setting process and, thus, not within the proceeding's purview. "[O]n its face, 47129(a)(1) instructs the Secretary of Transportation to determine the reasonableness of a fee, not of the process used to set the fee." LAWA submits that the terminal rents at issue are not unreasonable or unjustly discriminatory and that the Airlines' complaints should be dismissed. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
May 4, 2007 Exhibit of LAX - 3944 Pages
May 4, 2007 Nothing in the Airlines’ briefs undermines the fact that LAWA’s new terminal rents in T1, T3 and TBIT are reasonable and not unjustly discriminatory, and therefore entirely lawful. On the issue of whether LAWA’s new terminal rents are reasonable, the overarching theme of the Airlines’ briefs is that the new terminal rents are unnecessary because LAWA and LAX are making enough money from LAX’s concessions to pay all of the costs LAWA incurs in operating the LAX terminals, and still make a profit, even without charging the Airlines for terminal costs fairly attributable to them. On the issue of whether LAWA’s new terminal rents are unjustly discriminatory, despite the number of pages the Airlines devote to the issue, their claim fails ab initio since they have utterly failed to show that the new terminal rents treat similarly situated airlines differently. The Airlines have not produced a scintilla of evidence that any of them in 2007 is similarly situated to any of the airlines in the 1980s that signed longterm, 40-year leases. Finally, the Airlines have offered no cogent rationale as to why they are not bound by the terms of their leases to pay M&O costs for periods before they became subject to the Tariff at LAX. The Airlines do not deny that “written agreements” governed their occupation of terminal space at LAX until January 31, 2007 (for T1/T3 Carriers), and until March 31, 2007 (for TBIT Carriers). Indeed, other than the leases, there is no other legal basis for LAWA to impose the contested M&O charges for this period. Accordingly, the Court should find that under § 47129(e)(1) it lacks jurisdiction to hear claims concerning the proper interpretation of these written agreements. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
May 9, 2007 Respondents' Answer to Joint Complaint Purportedly Filed on April 30, 2007 The 22 foreign air carriers captioned on the Joint Complaint In Opposition To New Terminal Charges At Los Angeles International Airport purportedly filed with DOT on April 30, 2007, are currently operating out of the Tom Bradley International Terminal at Los Angeles International Airport. In the Second Joint Complaint, the Foreign Complainants seek to challenge the exact same terminal rate methodology currently at issue in Alaska Airlines v. LAWA, Docket OST-2007-27331 — a case in which the final reply briefs were submitted to the Administrative Law Judge just five calendar days ago. The Foreign Complainants have styled this new, Second Joint Complaint as a complaint filed under 49 U.S.C. § 47129, or, in the alternative — apparently in recognition of the fact that current case law disallows such a suit — Foreign Complaints seek to proceed under 49 U.S.C. § 40113(a). The Second Joint Complaint should be summarily dismissed: (1) because foreign air carriers are not proper complainants under 49 U.S.C. § 47129; (2) because the filing of the Second Joint Complaint as a § 47129 complaint directly violates the Instituting Order in Alaska Airlines v. LAWA, Docket OST-2007-27331 and (3) because the Second Joint Complaint is untimely under 49 U.S.C. § 47129(a)(1)(B) and 14 C.F.R. § 302.602(b). Foreign air carriers are not proper complainants under § 47129. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
May 9, 2007 Declaration of Patricia V. Tubert in Support
May 9, 2007 Certificate of Jeffery A. Tomasevich of Serrvice of the Answer
May 9, 2007 Certificate of Service for Respondents
May 14, 2007 Notice of Action in Port Authority of New York and New Jersey v. DOT Respondents, the City of Los Angeles, Los Angeles World Airports and the Los Angeles Board of Airport Commissioners, hereby respectfully notify the Department of Transportation that the U.S. Court of Appeals for the District of Columbia Circuit has denied the foreign air carriers' petitions for rehearing and for rehearing en banc in Port Auth. of N Y. & N.J. v. DOT, 479 F.3d 21, 33 (D.C. Cir. 2007). As a result, the decision in that case is now final. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
May 21, 2007 Respondent's Opening Brief to the Secretary on Exceptions to the Recommended Decision For two primary reasons, LAWA submits — and does so only after careful and thoughtful consideration — the RD is such a seriously flawed decision that the Secretary has no choice but to reject it in nearly every respect. First, as shown below, the RD rests on fundamental misunderstandings of the most basic, long-standing and clearly-established tenets of airport rate-setting law. Second, as even the most casual reader can observe, it is marred by injudicious — and wholly unwarranted — invective against LAWA’s witnesses. Consequently, LAWA respectfully requests that the Secretary (1) unequivocally disavow the myriad legal errors in the RD to preclude the RD from being cited as precedent, and (2) unequivocally reject the intemperate attacks on LAWA’s witness so as to staunch the damage to their good character and reputation. Despite these grave and insurmountable errors, the RD does not obscure that there is essentially one central issue in this case from which all other issues flow: Whether, when LAWA entered into 40-year leases in the 1980s with some airlines at LAX (now referred to as the Long-Term Carriers), LAWA bound itself not to change the methodology by which terminal rents are calculated for any airline operating at LAX for the next 40 years until the last of those leases expires on (or about) December 25, 2023. LAWA’s position is that it did no such thing. When it signed 40-year leases in the 1980s, LAWA simply promised to honor the terms and conditions of those leases with the airlines that signed them and thereby obligated themselves to be 40-year tenants of LAX, bearing all the risks and assuming all the burdens associated with 40-year leases. As to other airlines, which did not sign 40-year leases (and which, therefore, did not agree to bear the risks and assume the burdens of being 40-year tenants), LAWA made no such promise. As to these airlines, LAWA is limited in its ability to charge terminal rents only by the requirement to use a reasonable methodology. Counsel: Kaye Scholer, Steven Rosenthal, 202-682-3500, srosenthal@kayescholer.com
|
|||