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Case number 17-1012, Airline Pilots Association International and Out.

[00:00:07] Speaker 00:
Petitioners versus Elaine L. Chao, Secretary of the United States Department of Transportation.

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Mr. Bailey for the petitioners, Ms.

[00:00:15] Speaker 00:
Swingle for the respondent.

[00:00:22] Speaker 03:
Good morning.

[00:00:24] Speaker 06:
Good morning.

[00:00:26] Speaker 06:
May it please accord, I'm Russ Bailey.

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For petitioners with me today is Dave Simanczak from the Airline Pilots Association.

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We are challenging DOST's decision to grant a foreign air carrier permit to Norwegian Air International under the U.S.-EU Air Transport Agreement.

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The Air Transport Agreement contains a labor article unique among air services agreements.

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That article, Article 17bis, was put—placed in the agreement in response to concerns that airline labor had about the possible use of economic opportunities provided by the agreement by European Union carriers.

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That article expresses the intent of the parties that the opportunities created by the agreement are not to be used to undermine labor standards.

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The article also says that this intent is to guide the parties—

[00:01:21] Speaker 03:
Yes, Judge Santel, do you want to ask a question?

[00:01:24] Speaker 02:
Yes, I would like to ask a question, or at least ask that counsel get to standing at some point, because you have to establish that before any of the rest of that matters.

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Can you address specifically whether the flat attendance case is a controlling precedent that holds against you on standing?

[00:01:48] Speaker 06:
I'm afraid I missed part of that question, Judge Centell.

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I think Judge Centell is asking as to your standings, whether or not you are controlled by the Air Pilot's decision.

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The flight attendants.

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The flight attendants, excuse me.

[00:02:03] Speaker 06:
Yeah.

[00:02:04] Speaker 06:
No, we do not believe we are at all, Your Honor.

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There's a long string of competitor standing cases in this and other circuits.

[00:02:14] Speaker 02:
Not expanded competitor standing case.

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This is factually apparently very similar to the flight attendants.

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You're not in great competition with nobody else with the airline that's doing granted threats.

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So why doesn't flight attendants control rather than any other president?

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Because each of the competitor standing cases we cite, Your Honor, they basically recognize that workers in their unions suffer competitive harm when an agency's lift regulatory

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restrictions that allow foreign workers to compete with the U.S.

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workers in their markets.

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And that's precisely what we have here.

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We have Arthur Davidson in our brief that show that we have thousands of pilots and flight attendants who compete on the transatlantic services.

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and the Department of Transportation has issued a permit to Norwegian Air International so that they may operate in those very markets.

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And each of these cases, both before and after and in this circuit and in other circuits, uniformly hold that unions and their workers have competitive standing in that type of circumstance.

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The AFA case seems to be a little bit of an aberration.

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It really does seem to be an outlier from this long string of competitor standing cases.

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And I note that that case did not mention the competitor standing cases.

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And I note that the Department of Transportation brief did not mention those cases either when they challenged our standing.

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Okay, thank you.

[00:03:53] Speaker 06:
Okay, going back to our article, article 17bis, expressing the intent, the opportunities created by the agreement are not to undermine labor standards and that the intent is to guide the parties as they implement the agreement.

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Now the court- For my clarification, is your position that even if the three conditions you requested had been included, that you would still be opposing

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approval of the application for the permit?

[00:04:31] Speaker 06:
Your Honor, that's a very good question.

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We didn't have that opportunity to make that decision.

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We do believe that for the reasons we state in our briefs, that the department's decision should be vacated.

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That was an alternative argument for us on the conditions.

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That if the department did decide to grant a permit,

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that in that case it should place conditions on the permit in order to mitigate labor harm.

[00:04:55] Speaker 03:
Well, I ask that question for two reasons that I'm sure you appreciate.

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One, I understand your argument that you asked for these conditions and the department has never responded.

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And therefore, we should at least remand so that the department will respond and you have an opportunity to respond to their response, et cetera, and see what can be worked out.

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But I'm also trying to understand, it seems that the department's position has been that unless Article 17 would authorize the department to disapprove or not approve the application, then it's more or less irrelevant to the question of approval of the application as such.

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as opposed to what I understand in part to be your argument that you do think it is independent ground for rejecting the application, but even if it isn't, the application is, or at least the department's approval of it is legally deficient because it has given no meaning to Article 17.

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Is that your argument?

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Yes, and I thought you were going to take it even one step further.

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That is our argument.

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Article 17bis does provide an independent ground for turning down an application.

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But even if it doesn't, it should inform the public interest test.

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It should be part of the public interest test.

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Article 17bis has a purpose and a meaning.

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It has its own instructions.

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It has its own objectives.

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The objectives are that

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labor standards are not to be undermined by use of opportunities under the agreement and the intent

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is that that principle shall guide the parties as they implement the agreement.

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And there's nothing more central to implementation of the Air Service Agreement than the grant of a foreign air carrier permit.

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And so we believe that Article 17BIS, if it's not an independent basis, which we are not for a minute conceding that it's not, that it should at least be part of the public interest analysis.

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The public interest analysis, which one of the components

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set out in the statute is that DOT is supposed to consider whether or not its action encourages... I know.

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But that's connected in the statute to the previous provision with an or.

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So let's assume that that doesn't get you anywhere, just for the moment, for purposes of argument.

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Is your argument that even if the department was not obligated to make a separate public interest obligation,

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it has to do more than look to articles four and six when it determines whether to approve this application.

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In other words, I'm trying to understand in the ideal world, would you want sort of chapter and verse about minimum wage, you know,

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hours, what are you seeking?

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That's impractical.

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That would be impractical, Your Honor.

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I understand, and I'm trying to figure out between that and sort of the aspirational statement.

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So one of the things I really urge you to take a look at, and which the Department did not take a look at,

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None of the agencies looked at this.

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It's a negotiating history of Article 17bis.

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And if you look at that, you'll see what the purpose of Article 17bis was.

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The idea was to have a general article that could have flexible application on a case-by-case basis in response to use of opportunities under the agreement.

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All right.

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I did read that, or at least what's in the record, before us.

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And that's what I'm trying to understand.

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exactly what you understand the purpose to have been.

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This is not sitting down, as I understand it, and negotiating a labor agreement as such.

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Absolutely not.

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But what is it?

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It's to set guidelines, a guidance for the parties as they implement the agreement, as they consider applications.

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So, minimum wage?

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No, absolutely not.

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It's a use of an opportunity under the agreement, and that's what we have here.

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The air service agreement goes on month in, month out, year in, year out with multiple EU carriers coming in and getting authorization.

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from the Department of Transportation without labor opposition.

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We have an exhibit in the agreement showing just between 2007 when the agreement came into effect and 2014 that there were at least 40 applications of European Union carriers that were, 40 European Union carriers received operating authorization

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with no opposition.

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Since then there's been dozens more.

[00:10:01] Speaker 03:
Alright, so you know how in this country we have various national standards for various industries.

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Is that what's contemplated some international code almost?

[00:10:13] Speaker 06:
No.

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In fact, Your Honor, you'll see if you take a look at the the European Union appointed an examiner to take a look at the labor's issues during the negotiations.

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And he took a look at that and he says there's no way, there's no time

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to have international standards.

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We're not doing that.

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What we need to have is something that's broader and flexible.

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And that's what we have.

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Something that, when a case comes along like this one, where you have a foreign airline that comes in to specifically use an opportunity under the agreement, in this case, Norwegian was established in Ireland,

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because its parent company did not want to have Norwegian labor laws applied to it.

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And you'll see that all over the record, at the beginning of the record, between pages 50 and 70, the reasons Norwegians said it was going to Ireland.

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And the reason was to get out from under Norwegian labor standards.

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And Ireland would let them do what the Norwegian government wasn't going to let them do, which was to use Thai and Singapore contract pilots on their transatlantic services.

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And we thought that was out of bounds.

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And so that's why it's the first case

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that we have opposed, we believe this is exactly, and I think if you look at the negotiating history, it's this flag of convenience type of business model that is exactly what Article 17 was about.

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All right, so that's something very specific, all right, and that's reflected in the negotiating history in terms of what was of concern.

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Did you propose to the department at some point a list of principles

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No, we did not, Your Honor.

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We did not.

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By the proposal of the department, I take it you mean during the negotiations of the Air Service Agreement?

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As to this airline, yes.

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No, we didn't.

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Other than we felt at this point, we had the agreement in place.

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We had Article 17bis.

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We were trying to just... It's not only Article 17bis.

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It's also the public interest.

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And the public interest has to be applied here, too, because under the Air Services Agreement,

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In Article 4 of the Air Services Agreement, it says the other laws and regulations normally apply to air service operations.

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That includes the public interest test.

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And we would say that a minimum of Article 17bis doesn't provide an independent basis to deny the application.

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It at least has to be considered as part of the public interest test, which also concludes a component the Department of Transportation is supposed to look at whether its actions encourage fair wages and working conditions.

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What do you make of the department's statement that it took everything into account, including

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the President or the Executive Director's letter as to what commitments he was going to make in terms of hiring, et cetera, under this agreement.

[00:13:08] Speaker 06:
Well, Your Honor, SOP and IWASH are harsh words, but I think those words apply here.

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His commitments in no way addressed our concerns.

[00:13:19] Speaker 03:
Well, but the department

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It may not have, but it did address his commitments.

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Well, you wouldn't disregard them, I assume.

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The way I read them, they might be of some interest to your members.

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But anyway, let's assume.

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No, and I think it's important to explain why.

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What he committed to do, his commitments, his commitments did not satisfy us.

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He just committed to doing what he was already doing.

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He committed to continue to use U.S.

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and EU citizens.

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Our concern is not the citizenship of the pilots and flight attendants.

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It's what contracts are under.

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And the contracts are under are Singapore and Thai contracts.

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And that's what we want.

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We want to have the pilots and flight attendants under U.S.

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or EU contracts.

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not under agent contracts, short-term agent contracts.

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You'll see the contract, one of the contracts in the record.

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Short-term agent contracts with no opportunity for collective bargaining representation.

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And we just felt that was out of balance.

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I was using an opportunity created by the agreement, specifically created by the agreement.

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This opportunity did not exist prior to this agreement.

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This opportunity for a European carrier to set up a subsidiary

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in another country and have it fly to the United States.

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That was a novel, unique opportunity created specifically by this agreement.

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One of the responses was that there would be a specific, unique labor agreement that would someway address the concerns that would be posed by the use of these economic opportunities.

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And I'm running out of my time.

[00:14:56] Speaker 04:
No, you may be, but from my point of view, you haven't gotten

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to the major problem it seems to me you have here, which is even if you write about Article 17 and its history and its importance, the statute gives the department two different avenues for approval.

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which is designation by an applicant's government under an international agreement.

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That's happened, right?

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That's happened here, right?

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And then it says or.

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It doesn't say and.

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It says or.

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if the permit is in the public interest.

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So you don't get to the public interest analysis at all under this statute.

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If it's covered by A, I don't understand.

[00:16:00] Speaker 04:
You have to explain to me why that doesn't just end the analysis.

[00:16:03] Speaker 06:
I'm sorry.

[00:16:04] Speaker 06:
Your Honor, as you might suspect, I'm going to disagree with you.

[00:16:07] Speaker 04:
Well, I suspect you do.

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And let me explain my disagreement.

[00:16:12] Speaker 04:
Well, should I read?

[00:16:12] Speaker 04:
Well, go ahead.

[00:16:13] Speaker 04:
Tell me.

[00:16:14] Speaker 04:
It says or, right?

[00:16:15] Speaker 06:
It says or, but up above it says may.

[00:16:18] Speaker 04:
Yeah, but you agree that 2A is satisfied, right?

[00:16:21] Speaker 04:
Pardon me?

[00:16:22] Speaker 06:
This is covered by 2A.

[00:16:23] Speaker 06:
Yeah, 2A is satisfied.

[00:16:25] Speaker 04:
So it says it may do it under A or B. It's done it under A. That's right.

[00:16:32] Speaker 06:
So explain to me how you get to B. Yes, if you look at the legislative history.

[00:16:35] Speaker 04:
Wait, wait, wait.

[00:16:36] Speaker 04:
Don't go to the legislative history.

[00:16:39] Speaker 04:
You can get there in your next answer.

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Stick with the language.

[00:16:45] Speaker 04:
Tell me how, with this language, given that this is covered by 2A, we could require the Department to make a 2B finding, since it says 4.

[00:16:59] Speaker 06:
Because the statute does not require the Department to issue a permit.

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It says it may grant a permit.

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The Department has always interpreted the statute

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And its predecessor, the Civil Rights Board before it, interpreted the statute to mean both.

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Even though it has the option, they have always, always made a public interest finding in every case for the last half decade except in our case.

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It's the only one, and they have not provided a rational explanation of why they deviated from their practice, and their practice has set out... Well, maybe they were violating the statute for the past number of years.

[00:17:37] Speaker 04:
I still don't see... So your argument about the war is we should ignore it because the Department has never taken it seriously?

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Is that your point?

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No, no.

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The point is that it's always been discretionary, and you'll see that in the legislative history.

[00:17:50] Speaker 04:
Wait, wait, wait, wait.

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Always been discretionary under whose terms?

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Who says it's always discretionary?

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The department?

[00:17:58] Speaker 06:
I'd say the department's practice and also congressional legislative history, which says that this provision still empowers... Okay.

[00:18:05] Speaker 04:
We have very clear...

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case law here in the Supreme Court, that if a statute's clear, that's the end of the matter.

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That's it.

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We don't look at legislative history to create ambiguities in otherwise clear statutes.

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And we also have cases which say that a clear statute doesn't become ambiguous simply because an agency has violated it for years.

[00:18:30] Speaker 04:
So am I right then that your argument about this or separating 2A and 2B

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turns on A, the legislative history, and B, agency practice, right?

[00:18:46] Speaker 04:
Is there anything else?

[00:18:47] Speaker 04:
Yes.

[00:18:48] Speaker 06:
What is it?

[00:18:48] Speaker 06:
The statute itself, which says that department may grant.

[00:18:52] Speaker 06:
It doesn't say shall grant.

[00:18:53] Speaker 04:
It says it may grant.

[00:18:53] Speaker 04:
I don't understand how it helps.

[00:18:54] Speaker 04:
If it may do it under A, it's done it under A, right?

[00:18:59] Speaker 04:
I guess I don't get how may helps you.

[00:19:08] Speaker 06:
I think the way, you know, it says may grant.

[00:19:12] Speaker 06:
It doesn't have to.

[00:19:12] Speaker 06:
The Department's already retained its authority to do that.

[00:19:15] Speaker 06:
Congress recognized that at the time that it passed the Act.

[00:19:18] Speaker 06:
The Department retained its power, and the Department's exercised its power, and what has been applied is what's set out in the Department's guidelines for foreign air carrier permits, in which

[00:19:30] Speaker 06:
It states expressly that the one public interest factor that it considered in its order, which is whether or not the routes are provided under the Air Service Agreement, that is one of several factors to be considered.

[00:19:44] Speaker 06:
And among the factors that are to be considered, and this is what the foreign carriers are advised when they come to DOT and they take a look at what the guidelines are, they're advised that this is a public interest test that applies.

[00:19:54] Speaker 06:
One of the factors is whether the rights exist, and another factor

[00:19:57] Speaker 06:
is the merits of the pleadings that are filed in opposition to the application.

[00:20:02] Speaker 06:
And in this case, we filed voluminous pleadings, as you might imagine, explaining the harm that would be created by the grant of a permit to Norwegian Air to our pilots and flight attendants.

[00:20:19] Speaker 03:
Would you like to save the rest of your time for rebuttal?

[00:20:22] Speaker 06:
If I have time, I'd like to save it for rebuttal.

[00:20:35] Speaker 01:
Council for Respondent, good morning.

[00:20:38] Speaker 01:
Good morning.

[00:20:38] Speaker 01:
May it please the Court Chair and Swingle from the Department of Justice for the Secretary of Transportation.

[00:20:44] Speaker 01:
If I may, I'd like to begin with standing.

[00:20:46] Speaker 01:
I think petitioners were on notice here from the outset that their standing was not self-evident from the administrative record.

[00:20:53] Speaker 01:
As Judge Sentel earlier noted, the flight attendants case involved virtually identical facts to this case.

[00:21:01] Speaker 01:
There a group of airline crew of legacy carriers challenged the FAA's grant of a permit to Virgin Airways on the ground that Virgin would take market share from the legacy carriers and lead to reduced work and pay for the crew of those other carriers.

[00:21:17] Speaker 01:
And this court held that the petitioners there were required to submit evidence establishing standing at the earliest opportunity

[00:21:24] Speaker 01:
that is, with their opening brief, and also that the declarations that were submitted in that case failed to establish Article III standing.

[00:21:32] Speaker 03:
So what of the declaration attached to the reply brief in this case?

[00:21:37] Speaker 01:
So I would say that should not even be properly considered by the Court.

[00:21:41] Speaker 03:
I understand that is the thrust of your argument.

[00:21:44] Speaker 03:
I'm asking you to address it.

[00:21:46] Speaker 01:
Absolutely, Your Honor, although I will say this Court's cases are very clear that the reply brief is... American Library, Congress versus EFCC, for example, and other cases.

[00:21:57] Speaker 03:
So will you address the declaration attached to the reply brief?

[00:22:02] Speaker 01:
I will, Your Honor.

[00:22:03] Speaker 01:
I think those declarations, even if considered by the Court, are completely inadequate to establish standing here.

[00:22:09] Speaker 01:
The thrust of the theory of standing here is that there will be pressure

[00:22:15] Speaker 01:
brought to bear that will reduce the wages and salaries of the existing employees.

[00:22:22] Speaker 01:
Frankly, every step of that causal chain has failed to be established.

[00:22:27] Speaker 01:
First, there is no evidence that Norwegian Air will in fact

[00:22:32] Speaker 01:
adopt the labor practices about which petitioners are apparently concerned.

[00:22:37] Speaker 01:
Norwegian Air's leadership has made a voluntary commitment not to adopt those labor practices.

[00:22:44] Speaker 03:
So standing would only arise at the point, let's suppose petitioners oppose work condition A. Right.

[00:22:54] Speaker 03:
The agreement is approved, it goes into effect, and the carrier implements condition A.

[00:23:02] Speaker 03:
Then what?

[00:23:04] Speaker 01:
Well, I think, you know, obviously if there were a non-speculative likelihood that Condition A would go into effect and that Condition A would impose injury on petitioners, we would have a different case here.

[00:23:16] Speaker 03:
So what about sort of the law of economics argument that's basically what is made in the reply brief declaration?

[00:23:25] Speaker 01:
So under this circuit's law, they need to show that it is a virtual certainty that that economic injury will happen.

[00:23:34] Speaker 01:
As a historic matter, I would point out that Norwegian Air has already had another affiliate that has been operating out of Ireland to the United States since 2014, and that is exactly the affiliate that was

[00:23:49] Speaker 01:
uh... claimed to have adopted the harmful labor practices and yet there is no actual evidence that has been submitted

[00:24:01] Speaker 03:
agreement with a foreign carrier.

[00:24:03] Speaker 01:
I don't think we would require that, Your Honor, but I think it is telling that, in fact, one would expect if there were evidence of harm resulting from the kind of labor agreements that they complain of, they have not actually substantiated it, and there is historic practice that would have given rise to actual evidence that they could have done so.

[00:24:23] Speaker 03:
Well, that's what you're telling us at this point, and they have submitted an affidavit

[00:24:28] Speaker 03:
by somebody who's been in the business, how many years did he stay?

[00:24:32] Speaker 03:
At all levels, in all circumstances, including the one at issue.

[00:24:41] Speaker 01:
who looks to historic practice, and yet that was not sufficient for this court in flight attendance to assume that there would, in fact, be competitive injury.

[00:24:50] Speaker 01:
I think this court's flight attendance decision forecloses the argument that simply because another carrier comes into the marketplace, one can assume competitive injury.

[00:25:00] Speaker 03:
I think the places... Well, this affidavit goes further than that, however, and that's why I'm trying to understand the level of specificity you would want.

[00:25:08] Speaker 03:
Would you want

[00:25:09] Speaker 03:
an affidavit that says Mr. Jones, a pilot, used to make

[00:25:14] Speaker 03:
I don't know, $200,000, and now he's making $50,000.

[00:25:17] Speaker 01:
Well, I think one would expect a closer nexus between, I mean, their affidavit turns on the predicate that any time a new market competitor enters the marketplace, the employees of its competitors can be presumed to be injured.

[00:25:35] Speaker 01:
And I don't think this Court's competitor standing cases support that inference.

[00:25:40] Speaker 03:
I don't know that in our competitive standing cases that we've required,

[00:25:45] Speaker 03:
quite the type of level of injury.

[00:25:47] Speaker 03:
In other words, we've said, you know, the owner of an industry doesn't have to wait until he's got a closed shop before he can come into court.

[00:25:56] Speaker 03:
He can see the handwriting on the wall because the economic laws are as plain as it

[00:26:01] Speaker 03:
you know, eyeglasses on your head.

[00:26:04] Speaker 01:
But those have been in cases in which the petitioner was, in fact, the direct competitor of the market entrant, right?

[00:26:09] Speaker 01:
We're not taking the position that if United Airlines were the petitioner here, that they could not bring a case under the competitor standing cases.

[00:26:17] Speaker 03:
So what about the employees of the competitor standing cases?

[00:26:21] Speaker 01:
So I think in the cases in which this Court has let employees come in, there has been a much more direct

[00:26:28] Speaker 01:
impact because the challenged government decision allowed people to compete against those employees who otherwise would have been foreclosed from competition.

[00:26:39] Speaker 03:
So, for example, the... I think we have your argument on standing.

[00:26:43] Speaker 01:
Yes.

[00:26:43] Speaker 03:
And you may prevail on that.

[00:26:45] Speaker 03:
I don't know.

[00:26:46] Speaker 03:
Could we move on?

[00:26:47] Speaker 03:
Well, can I?

[00:26:47] Speaker 03:
I have a question.

[00:26:48] Speaker 03:
Judge Cadell has a question.

[00:26:50] Speaker 04:
Yeah.

[00:26:51] Speaker 04:
So, you know,

[00:26:54] Speaker 04:
When I first read these briefs, it seems to me you were exactly right.

[00:26:59] Speaker 04:
In fact, I didn't think I had to go beyond standing.

[00:27:02] Speaker 04:
It just didn't seem to me it met our standards.

[00:27:05] Speaker 04:
But then I came across international brotherhood of Teamsters versus DOT, which is cited at the reply brief at page three.

[00:27:17] Speaker 04:
Are you familiar with that case?

[00:27:19] Speaker 03:
That's the one about the Mexican trucks.

[00:27:21] Speaker 03:
Right.

[00:27:22] Speaker 04:
You're familiar with that case?

[00:27:23] Speaker 04:
I am, Your Honor.

[00:27:24] Speaker 04:
Huh?

[00:27:24] Speaker 01:
I am, Your Honor.

[00:27:25] Speaker 04:
You're not?

[00:27:26] Speaker 01:
I am, Your Honor.

[00:27:26] Speaker 01:
She says she is.

[00:27:27] Speaker 04:
Oh, you are.

[00:27:28] Speaker 04:
Well, why doesn't that make standing self-evident in this case?

[00:27:34] Speaker 04:
We said that an association of truck drivers

[00:27:40] Speaker 04:
had standing the challenge of DOT program, which allowed Mexican truck drivers to operate in the United States.

[00:27:50] Speaker 04:
And we didn't cite any.

[00:27:52] Speaker 04:
We just based it on the law of economics.

[00:27:55] Speaker 04:
There were no affidavits.

[00:27:57] Speaker 04:
We said, well, how do you distinguish that case?

[00:28:01] Speaker 01:
So, and I will admit, Your Honor, I think the Court did not provide an enormous amount of reasoning for its decision.

[00:28:07] Speaker 04:
Right, there's one sentence, but that's, this is our latest case on this subject, and it says, quote.

[00:28:12] Speaker 03:
And that was a big case.

[00:28:13] Speaker 04:
It says, quote, absent the pilot program.

[00:28:18] Speaker 04:
Members would not be subject to increased competition from Mexican domiciled trucks.

[00:28:24] Speaker 04:
And you could say exactly the same thing here.

[00:28:26] Speaker 04:
Absent Norwegian air, petitioner members would not be subject to increased competition from the red lines.

[00:28:32] Speaker 04:
It seems like right in point.

[00:28:34] Speaker 01:
So I think the key distinction would be, and I would also point to this court's decision in the Bricklayer's case, which is cited in the reply brief, which is that the Mexican truckers, but for the pilot program, would not have been able to work in the United States, and hence would not have been in the competitive marketplace.

[00:28:53] Speaker 03:
No, no, this was the Mexican, this was, it was, we allowed- No, you think, but what for NAFTA, the Mexican truckers would not have been here?

[00:29:02] Speaker 01:
In the same way as the bricklayer's case or the case involving the Canadian crew members on the ships.

[00:29:09] Speaker 01:
It's an instance in which literally those foreign workers could not have been in the market taking the jobs of Americans.

[00:29:17] Speaker 03:
Well, let me take it one step further.

[00:29:18] Speaker 04:
Excuse me, that wasn't the point of the case.

[00:29:20] Speaker 04:
I'm sorry.

[00:29:22] Speaker 04:
The argument there was that these Mexican companies, the companies,

[00:29:30] Speaker 04:
by paying their workers less would adversely affect American truck drivers.

[00:29:34] Speaker 04:
It's exactly like this case.

[00:29:38] Speaker 04:
I understand your point.

[00:29:43] Speaker 04:
I see exactly why you wrote the brief the way you did.

[00:29:45] Speaker 04:
But I don't see how we were bound by this case.

[00:29:49] Speaker 04:
And this case seems to say, under facts just like this, that standing is self-evident based just on the laws of economics.

[00:29:57] Speaker 01:
So I think, Your Honor, that decision needs to be read congruently with the rest of this Court's case law, including, for example, the flight attendant's case, in which the Court said quite clearly the mere fact that Virgin is coming into the market and flying competitively with U.S.

[00:30:13] Speaker 01:
legacy carriers was not sufficient to show a competitive injury that would give its crew members standing.

[00:30:19] Speaker 01:
I think one needs to look at the kind of

[00:30:23] Speaker 04:
Well, can you find a way, can you find a way for us to rely on... Do we have to say that this decision's wrong?

[00:30:35] Speaker 01:
No, absolutely not, Your Honor.

[00:30:37] Speaker 01:
Why?

[00:30:37] Speaker 04:
I think the problem here... I mean, we really can't do that.

[00:30:40] Speaker 01:
We have no which decision.

[00:30:42] Speaker 02:
In that regard, if the two cases are inconsistent,

[00:30:47] Speaker 02:
And since it's the law that one panel came over with another one, as Judge Taito was suggesting, isn't it the case that later decision, factor decision is wrong in the actual, the earlier case action controls?

[00:31:01] Speaker 01:
That would, of course, be the general rule, but I don't think it's necessary to go to that general rule because I think the real distinction here, and perhaps I can turn to another case that I think illustrates what the distinction is here, and contrast it to the facts of this case.

[00:31:17] Speaker 01:
In our case, we have no reason to believe from the declarations or from anything in the administrative record

[00:31:23] Speaker 01:
that the pilots and crew who will be coming on Norwegian Air's flights are any different, are any different nationality, any different background, any different citizenship than the pilots and crew who are currently operating on the legacy carriers that are, the crew members of which are the members of the petitioners here.

[00:31:45] Speaker 03:
Actually there is some suggestion in the record that we do know that there will be a difference.

[00:31:50] Speaker 01:
So, Your Honor... Because they are hiring, they're using, what is it, the Thai companies... They're using a third-party staffing company that has contracts under Thai or Singaporean law, but there's no reason, they do not assert that the nationalities or citizenship of the pilots and crew are different.

[00:32:08] Speaker 03:
But the citizenship is not the issue.

[00:32:10] Speaker 01:
Well, I think it's important because obviously, depending on where the flights are domiciled, depending on where their crew are domiciled, labor laws control, national labor laws control.

[00:32:21] Speaker 03:
Well, that's what I was going to get to.

[00:32:23] Speaker 03:
Here we have this international agreement that has Article 17 in it.

[00:32:33] Speaker 03:
And who is going to be affected

[00:32:37] Speaker 03:
for good or ill by Article 17, and at least not looking at the legislative history, but looking at the negotiating history in terms of at least what some understood was the purpose of Article 17.

[00:32:56] Speaker 03:
Why

[00:32:57] Speaker 03:
doesn't that distinguish these other cases?

[00:33:01] Speaker 03:
I mean, the Mexican and the U.S.

[00:33:03] Speaker 03:
employees didn't have any special provision in the NAFTA agreement as such that was being relied on in those cases.

[00:33:13] Speaker 03:
I'm not familiar enough with the agreement in the Virgin Air case.

[00:33:18] Speaker 03:
In other words, my hypothetical earlier was,

[00:33:22] Speaker 03:
The department approves the application, the carrier starts operating, and it implements condition A. And condition A is exactly what the petitioners were opposed to and tried to get the department to address.

[00:33:42] Speaker 03:
Then they come in and sue.

[00:33:46] Speaker 03:
I mean, wouldn't they just be thrown out of court?

[00:33:51] Speaker 01:
Well, I don't think so, Your Honor.

[00:33:53] Speaker 01:
I mean, I do think.

[00:33:54] Speaker 03:
Well, the carrier has an agreement.

[00:33:56] Speaker 03:
There's nothing in the agreement that said he had to avoid condition A. Right.

[00:34:04] Speaker 01:
Well, obviously, the claim here is that the mere grant of authorization to operate

[00:34:10] Speaker 01:
is going to impose imminent and substantial harm on petitioners here.

[00:34:15] Speaker 01:
Whatever the case may be there, and we are certainly not contesting the zone of interest or prudential standing, they do have a requirement to show Article III injury here.

[00:34:26] Speaker 01:
And with all due respect,

[00:34:29] Speaker 01:
beyond speculation about how this would impact them and in the face of a history in which there is already another carrier claimed to follow the same disfavored labor practices and yet they have shown no evidence that that has actually impacted them in any material way.

[00:34:45] Speaker 01:
I just think that the injury here is speculative.

[00:34:49] Speaker 04:
And could you just say once again, so I understand, and picking up the point Judge Sentel made, which is that if we have two decisions in conflict, we're obligated to follow the first, right?

[00:35:05] Speaker 01:
Yes, Your Honor.

[00:35:06] Speaker 04:
And so explain to me why that principle doesn't come into play here.

[00:35:13] Speaker 01:
Because, Your Honor, we don't believe that those decisions are, in fact, inconsistent.

[00:35:17] Speaker 01:
Yeah, I know, but why?

[00:35:18] Speaker 01:
And I think it's because... Just tell me once again.

[00:35:20] Speaker 04:
In the Mexican trucking cases, in the bricklayer's case... Just do the Mexican truck drives.

[00:35:29] Speaker 01:
So I think it's a circumstance in which, but for the government's decision to institute that pilot program, the drivers of those trucks could not have worked in the United States.

[00:35:39] Speaker 01:
They would not have been part of the competitive labor pool that affected the US truckers there.

[00:35:43] Speaker 01:
Any difference here?

[00:35:45] Speaker 01:
We have no way or reason to know that.

[00:35:48] Speaker 01:
We don't know who the pilots and crew are and whether they are already part of the competitive labor pool here.

[00:35:54] Speaker 01:
I mean, obviously, Norwegian Air, in its submissions,

[00:35:58] Speaker 04:
talked about hiring substantial numbers of U.S.-based... But the case says, it says that absent the new program, quote, members would not be subject to increase, members of this truck drivers association would not be subject to increase competition from Mexican domicile trucks operating throughout the United States.

[00:36:19] Speaker 04:
Isn't that exactly the same here?

[00:36:22] Speaker 04:
Except it's airplanes, not trucks.

[00:36:25] Speaker 04:
In other words, you could say exactly the same thing.

[00:36:28] Speaker 04:
Absent Norwegian air, petitioners' members would not be subject to increased competition from the new airline.

[00:36:38] Speaker 04:
I don't get the difference.

[00:36:39] Speaker 01:
Well, Your Honor, I don't think that understanding the case to mean simply that whenever a new market entrance comes in, any employee can challenge it.

[00:36:49] Speaker 01:
That would not be consistent with the way this Court has described the competitor standing cases as narrow.

[00:36:53] Speaker 04:
So we do need to invoke the rule that Judge Senthil suggests.

[00:36:56] Speaker 04:
We need to say this case is inconsistent with our precedent.

[00:37:01] Speaker 01:
I think that case did not fully elaborate on the Court's reasoning, and I would simply point the Court to the other earlier cases that have all turned in part on what would otherwise have been a legal barrier to entry into the competitive marketplace for the employees at issue.

[00:37:20] Speaker 01:
I think in the instances in which this Court has permitted competitor standing, where someone was not a direct competitor, but it was

[00:37:28] Speaker 01:
The claim was being brought by the employees of the new competitor or the legacy competitor.

[00:37:33] Speaker 01:
It has involved that kind of otherwise categorical restriction on entry into the marketplace for the employees of the new competitor.

[00:37:43] Speaker 01:
If I could turn briefly though to the merits.

[00:37:46] Speaker 01:
I think the court is exactly right that petitioners' argument here requires reading or as and under the statute.

[00:37:53] Speaker 01:
There is no basis for that in the plain language.

[00:37:56] Speaker 01:
I would like to just briefly discuss Judge Rogers' questions about the

[00:38:01] Speaker 01:
the denial of the request to impose conditions on the permit.

[00:38:06] Speaker 03:
When you say denial, the sub-celentio denial?

[00:38:09] Speaker 01:
Well, the court, if I can just answer that in a couple of ways.

[00:38:13] Speaker 01:
Well, I read what you said in your brief.

[00:38:15] Speaker 01:
In the final order, the Department of Transportation did, of course, specifically deny all other requests for relief that had been made in any of the objections to the order to show cause.

[00:38:25] Speaker 03:
as this court is likely... So it is, you're arguing, just a subsolentio.

[00:38:30] Speaker 01:
Yes, Your Honor, and not even... And yet... Well, not subsolentio, Your Honor.

[00:38:34] Speaker 03:
And yet the department put all these conditions

[00:38:40] Speaker 03:
on the foreign air carrier, Kermit.

[00:38:43] Speaker 01:
So the department put standard conditions, but did not put, if I could point the court to the Joint Appendix at page 501, that is the only request that was made by the airline pilots for conditions.

[00:38:56] Speaker 01:
It was very much an afterthought in their objections.

[00:39:00] Speaker 01:
They asked for those conditions to be imposed under Article 17E.

[00:39:04] Speaker 03:
All right, but you're not arguing they didn't ask.

[00:39:07] Speaker 01:
No, Your Honor.

[00:39:07] Speaker 03:
They didn't write a book.

[00:39:09] Speaker 03:
Okay, and I brought out they didn't give you a set of principles either.

[00:39:13] Speaker 01:
And no explanation for the conditions that they suggested as illustrative.

[00:39:17] Speaker 03:
Well, but again, they're sort of self-evident, it seems to me.

[00:39:20] Speaker 03:
Correct.

[00:39:21] Speaker 03:
So the department isn't suggesting that.

[00:39:22] Speaker 03:
That wasn't the position you took in your brief at all.

[00:39:25] Speaker 01:
No, and I'm not suggesting that, but I would say that the Department did in fact address the substance of that request in its analysis of Article 17B.

[00:39:34] Speaker 03:
No, see, that's what I'm getting at.

[00:39:35] Speaker 03:
The question that your Council answered and the question that your Department, your Council, that is General Counsel of the Department of Transportation, asked the State Department and the Office of Legal Counsel

[00:39:50] Speaker 03:
to answer was different.

[00:39:53] Speaker 03:
It said, tell us whether or not Article 17 is an independent basis on which the application for the permit can be denied.

[00:40:06] Speaker 03:
And everybody said no.

[00:40:09] Speaker 03:
That's not the issue.

[00:40:10] Speaker 03:
Well, that's all I'm getting at.

[00:40:12] Speaker 01:
That's correct.

[00:40:13] Speaker 01:
And that was, of course, the thrust of the bulk of the objections to what was done.

[00:40:17] Speaker 03:
But they had an alternative.

[00:40:19] Speaker 03:
They said, if we can't get the whole loaf of bread, we want some slices, namely these conditions.

[00:40:27] Speaker 01:
And Your Honor, if I may.

[00:40:29] Speaker 03:
And where did the department say anything about those conditions?

[00:40:32] Speaker 01:
So as you know, it was the department's view and its construction of the treaties that

[00:40:39] Speaker 01:
under the statute and under the agreements.

[00:40:43] Speaker 01:
the labor-related objections were not a basis for unilaterally denying the application.

[00:40:49] Speaker 01:
But as you know, at 572 and 573, in its final order, the department did consider the labor-related objections that had been raised, and it took into account the commitments that had been made, which would not have been relevant under the department's view to the approval decision as a whole.

[00:41:07] Speaker 03:
And I don't know how those were enforceable.

[00:41:10] Speaker 03:
what you said or what the department said and the permit is, and we trust those commitments will be followed through.

[00:41:18] Speaker 03:
I mean, that's not part of the, I mean, can I sue on that?

[00:41:22] Speaker 01:
And the point of the objection was that we should consider labor-related issues under Article 17B.

[00:41:28] Speaker 01:
So my point is simply that the department did in fact do so.

[00:41:32] Speaker 01:
in reaching its final conclusion that it was not going to grant any of the other requests for relief that had been sought in the proceedings, which I think effectively disposes of that request for conditions.

[00:41:51] Speaker 01:
And I agree, it does.

[00:41:53] Speaker 01:
It gives them broad-ranging discretion to decide how to consider those.

[00:41:56] Speaker 03:
Right.

[00:41:56] Speaker 03:
And also the Commission.

[00:41:58] Speaker 01:
Exactly.

[00:41:58] Speaker 03:
All right.

[00:41:58] Speaker 03:
Anything critical that you wanted to say?

[00:42:01] Speaker 03:
No.

[00:42:02] Speaker 03:
Thank you very much.

[00:42:02] Speaker 01:
Thank you, Your Honor.

[00:42:04] Speaker 03:
All right.

[00:42:04] Speaker 03:
Council, for petitioner, we'll give you a couple of minutes.

[00:42:09] Speaker 06:
Okay, I'll do my best here.

[00:42:12] Speaker 06:
First thing, standing, I think, the AFA case, the Virgin America case can be distinguished by the fact that that's, for no other reason, it was a domestic airline, not a foreign airline.

[00:42:23] Speaker 06:
So we're talking about U.S.

[00:42:25] Speaker 06:
citizens.

[00:42:25] Speaker 06:
It was just a license to a foreign carrier.

[00:42:27] Speaker 06:
Wait, what's the difference?

[00:42:29] Speaker 06:
Virgin America was a U.S.

[00:42:32] Speaker 06:
license, not a foreign air carrier permit.

[00:42:34] Speaker 06:
So we're talking about U.S.

[00:42:35] Speaker 06:
citizens rather than foreign workers.

[00:42:42] Speaker 03:
But you're not suggesting that... No.

[00:42:46] Speaker 06:
My real argument is Mendoza and the IBT versus DOT case.

[00:42:53] Speaker 06:
Both of those were after the AFA case, and both of them made it clear that there was that a lot where an agency allows foreign workers to come in and compete against U.S.

[00:43:05] Speaker 06:
workers in their markets, and the transatlantic market is a market where we work,

[00:43:10] Speaker 06:
where the agency action allows the entrance of foreign workers that unions and their members suffer constitutional harm as a result of that action.

[00:43:21] Speaker 06:
With respect to the notion that we didn't put anything in the record about what Norwegian's parent company was doing, well, they didn't enter the Irish market until after this case was over, so there was no opportunity to do that.

[00:43:39] Speaker 06:
And on the harm and what's happening in the marketplace, you'll see the record is full of our requests for information, both, you know, we ask for information, we ask for documents repeatedly from DOT that would go precisely to these issues.

[00:43:56] Speaker 06:
Who is on the aircraft?

[00:43:57] Speaker 06:
What are their terms and conditions of employment?

[00:44:00] Speaker 06:
DOT never granted any of those and never got the information.

[00:44:04] Speaker 06:
So the reason the information's not in the record is because it wasn't requested by the department.

[00:44:08] Speaker 03:
It wasn't provided by the department.

[00:44:12] Speaker 06:
Pardon me?

[00:44:13] Speaker 03:
It wasn't provided by the department.

[00:44:15] Speaker 03:
You said it wasn't requested by the department.

[00:44:16] Speaker 06:
Well, we would have asked them to request Norwegian to produce that information.

[00:44:20] Speaker 03:
Oh, I see.

[00:44:21] Speaker 06:
So we were asking for, basically, document production request.

[00:44:24] Speaker 06:
We asked them to issue a document production request, and they didn't do that.

[00:44:30] Speaker 06:
All right.

[00:44:31] Speaker 06:
Public interest.

[00:44:34] Speaker 06:
I think we have your argument

[00:44:52] Speaker 06:
facing an armada.

[00:44:55] Speaker 06:
We have Department of Transportation, we have Department of Justice, we have Department of State, they all have their opinions.

[00:45:01] Speaker 04:
It's not an armada.

[00:45:03] Speaker 04:
It's not an armada.

[00:45:05] Speaker 04:
It's under our case law, we have to defer to the State Department.

[00:45:09] Speaker 04:
That is correct.

[00:45:10] Speaker 04:
That is correct.

[00:45:10] Speaker 04:
It's not like they're lining up against you.

[00:45:12] Speaker 04:
They've taken a position and you have a heavy burden to get us to second guess.

[00:45:17] Speaker 06:
I agree with that.

[00:45:18] Speaker 04:
And I haven't heard you say any of that.

[00:45:20] Speaker 06:
My analogy would be this, Your Honor.

[00:45:23] Speaker 06:
They look like the guns of Navarone at first blush.

[00:45:27] Speaker 06:
Deference is due to them, but deference is not advocation.

[00:45:30] Speaker 06:
I ask you to take, we have a guideline in our brief at pages 20 to 23,

[00:45:37] Speaker 06:
listing all the omissions and contortions that those agencies made in interpreting Article 17 of this.

[00:45:44] Speaker 06:
Mainly, none of them addressed the word shall, which is a directive word, and none of them addressed the word implement.

[00:45:50] Speaker 06:
And implement is granting a permit.

[00:45:52] Speaker 06:
And so the principles in that article shall guide the parties as they implement the agreement.

[00:45:58] Speaker 06:
Those words were not addressed.

[00:45:59] Speaker 06:
Those were caster oral words.

[00:46:01] Speaker 06:
They couldn't come to grips with them.

[00:46:03] Speaker 06:
So all I invite you to do is take

[00:46:06] Speaker 06:
our guidelines and take the text of Article 17 to us and put it side by side with those agency decisions and take a look.

[00:46:15] Speaker 06:
in the record is an opinion by the former Deputy Secretary of DOT, who was Deputy Secretary while this agreement was concluded, and he says in his views that the department's conclusions in this case twist Article 17 beyond recognition.

[00:46:31] Speaker 06:
I invite you to compare those two, you know, compare Article 17bis with the agency said and see if you don't agree with Mr. Picari.

[00:46:40] Speaker 06:
Thank you.

[00:46:40] Speaker 03:
Thank you.

[00:46:41] Speaker 03:
We'll take the case under advice.