[00:00:01] Speaker 03:
Case number 18-1303 at L. Exhaustus Inc.

[00:00:05] Speaker 03:
Petitioner versus Federal Aviation Administration.

[00:00:08] Speaker 03:
Mr. Blair for the petitioner.

[00:00:10] Speaker 03:
Mr. Schulz for the respondent.

[00:00:12] Speaker 02:
Good morning, Your Honors.

[00:00:17] Speaker 02:
May it please the Court.

[00:00:18] Speaker 02:
With me at council table is Mr. Steve Endres, CEO of Exhaustless, Inc.

[00:00:24] Speaker 02:
I've reserved three minutes for rebuttal time.

[00:00:26] Speaker 02:
I'm happy to answer any questions, but otherwise I'd like to focus on two issues in particular.

[00:00:32] Speaker 02:
First, the orders at issue are unlawful because the FAA skipped notice and comment.

[00:00:38] Speaker 02:
Second, the orders are arbitrary and capricious because the FAA failed to consider several key aspects of the problem.

[00:00:46] Speaker 02:
including the anti-competitive aspects of the temporary interim measures.

[00:00:51] Speaker 02:
There's no dispute here that the FAA's methodology is anti-competitive.

[00:00:55] Speaker 01:
So at least it would help me.

[00:00:57] Speaker 01:
Can you start with your theory of standing?

[00:00:59] Speaker 02:
Theory of standing, yes.

[00:01:00] Speaker 02:
Yes, Your Honor.

[00:01:01] Speaker 02:
We have standing here because our injury is the lost opportunity to compete, which is caused by the orders.

[00:01:07] Speaker 02:
As in the safe extensions case, the orders eliminate our opportunity to compete in the market with our congestion solution, congestion reduction solutions.

[00:01:20] Speaker 01:
And what do you mean by opportunity to compete?

[00:01:22] Speaker 01:
What would happen?

[00:01:24] Speaker 01:
What sequence of events would be occasioned if you were successful in your effort?

[00:01:29] Speaker 02:
If we were successful, as outlined in our reply brief, Your Honor, the only thing stopping ExhaustList from competing and marketing its services to airports and airports engaging ExhaustList with its services is the FAA's policy of allocating the slots.

[00:01:50] Speaker 02:
Because the slots are allocated,

[00:01:52] Speaker 02:
the airports are powerless to implement their power to use the two-part fee landing power that they had that this court found affirmed in the 2010 ETA v DOJ case, DOT case, excuse me.

[00:02:12] Speaker 02:
The airports currently cannot do that because as that case made clear, there are other regulations that apply to the landing fees.

[00:02:22] Speaker 02:
And the airports cannot charge more unless they would have the effect of reducing congestion.

[00:02:30] Speaker 02:
And the slot limitations as they are now are not just maximum.

[00:02:36] Speaker 02:
you know, no more than 71 planes can take off or land.

[00:02:39] Speaker 02:
It's also a minimum as well.

[00:02:41] Speaker 02:
So airports cannot charge more for landing fees at peak times because it's not going to affect congestion because the FAs forcing 71 planes to take off and land during that hour.

[00:02:57] Speaker 01:
So the way you spun that out, if you were able to get the orders undone,

[00:03:03] Speaker 01:
then you would be dealing directly with the airports?

[00:03:07] Speaker 02:
That is one way that we could compete, yes.

[00:03:09] Speaker 01:
And why would we suppose that the FAA is going to allow that to happen, given all the historical context that's led us to where we are with regard to congestion at these airports?

[00:03:21] Speaker 01:
Why is the agency just going to allow this process to unfold without the agency itself being involved?

[00:03:27] Speaker 02:
Well, I guess there's two components to that question.

[00:03:31] Speaker 02:
I guess is that we would contend that the FAA should not be micromanaging the regulation of the airport since the Airline Deregulation Act, the FAA, should be using market forces and not micromanaging exactly which planes take off when.

[00:03:49] Speaker 02:
But the second part of that question is this speculation of whether the FAA would let that happen.

[00:03:54] Speaker 02:
And as we've outlined in the brief,

[00:04:01] Speaker 02:
Teton case and the Pelletier case, it was enough that the party's economic incentives were enough to satisfy the redressability prong of standing.

[00:04:12] Speaker 02:
Here, if the FAA were to

[00:04:15] Speaker 02:
promulgated emergency rule, I would say that that's speculative as well.

[00:04:22] Speaker 02:
It's almost speculative that we wouldn't have an opportunity to compete.

[00:04:26] Speaker 01:
But I guess the reason I'm asking is that it seemed like everything in the case until your reply brief was geared around a universe in which the FAA would retain you to do the slots.

[00:04:38] Speaker 01:
And then the theory in the reply brief is that, no, no, no, it's not that anymore.

[00:04:43] Speaker 01:
It's not that the FAA would use, would at least allow us to use our product to administer everything at these airports under some arrangement with the FAA.

[00:04:54] Speaker 01:
But the FAA would just drop out and we'd be dealing directly with the airports.

[00:04:58] Speaker 01:
Would you say that there's at least been a shift in thinking, or do you think that this was the thought all along?

[00:05:04] Speaker 02:
I would say it was a shift in emphasis, Your Honor.

[00:05:06] Speaker 02:
As we tried to explain in the reply brief, and perhaps not clearly enough, that we still believe the ideal solution would be the FAA implementing the entire standard, including all the components.

[00:05:21] Speaker 02:
And that is more in line to your honor's last question, more in line with the history of the FAA spending 20 years looking for an FAA-centric solution to this problem.

[00:05:34] Speaker 02:
In the reply brief, we shifted emphasis to make sure it was clear that that's not the only way that the exhaustless could compete here.

[00:05:44] Speaker 02:
There are many ways that exhaustless could compete here that would not require the FAA to promulgate a new rule or enforce exhaustless auctions, et cetera.

[00:05:54] Speaker 02:
That's one way that it could.

[00:05:58] Speaker 02:
And I'd also point out that in the CC distributor case, the court found that whether

[00:06:03] Speaker 02:
the petitioner was

[00:06:06] Speaker 02:
the chances of succeeding once they had the opportunity to compete was an irrelevant factor.

[00:06:14] Speaker 02:
So again, we're not asking for the court to compel anyone to implement the exhaustless solution.

[00:06:23] Speaker 02:
It's that we should have an opportunity to compete.

[00:06:26] Speaker 01:
I'll ask a question along these lines.

[00:06:27] Speaker 01:
So then in this universe, what happens to the petition for rulemaking that's pending?

[00:06:33] Speaker 01:
So there's just two separate tracks, basically?

[00:06:35] Speaker 02:
They are two separate tracks.

[00:06:37] Speaker 02:
That was filed in May.

[00:06:39] Speaker 02:
The FAA has rules requiring that they respond within six months.

[00:06:45] Speaker 02:
They did not.

[00:06:46] Speaker 02:
But as we highlight in the briefs, we have not filed a petition for writ of mandamus.

[00:06:52] Speaker 02:
That separate petition for rulemaking, we would say, is outside the scope of this case.

[00:06:58] Speaker 01:
But it's only outside the scope of the case because of the theory that you developed in your reply brief.

[00:07:04] Speaker 01:
Because otherwise it seems like, you might have other arguments, but it's well within the scope of the case because you'd be asking the FAA in that petition for rulemaking

[00:07:13] Speaker 01:
basically to do the thing that seemed like would be the ultimate outcome, if you put aside direct negotiations with the airports, would be the ultimate outcome anyway, because the FAA then would be in arrangements with you to utilize this product.

[00:07:31] Speaker 02:
Well, Your Honor, the FAA could proceed in that way.

[00:07:34] Speaker 02:
I would say it's outside the scope of this case in the sense that we've not filed the petition for a writ of mandamus.

[00:07:42] Speaker 02:
So we're not asking the court to compel the FAA to promulgate the rule that we've petitioned for that rulemaking.

[00:07:49] Speaker 02:
That's one avenue.

[00:07:50] Speaker 02:
And one of the reasons we went into that level of detail in our opening brief is to show that we have standing.

[00:07:55] Speaker 02:
We're not just a citizen off the street that has an idea and wants to complain about all the things that the FAA has done in the last 12 years.

[00:08:04] Speaker 02:
Exhaustus is a party that has a third-party market-based proposed solution.

[00:08:10] Speaker 02:
They have tried to engage with the FAA to convince the FAA that this is the best solution.

[00:08:16] Speaker 02:
The FAA has ignored that, but that's outside the scope of this case because we're not asking the court to force the FAA to implement the proposed rulemaking.

[00:08:26] Speaker 02:
solution.

[00:08:28] Speaker 02:
And there are other ways the exhaust list could compete and help solve the congestion problem without any further action of the FAA as soon as the FAA stops handing out slots for free.

[00:08:40] Speaker 02:
So back to the anti-competitive methodology again, it's undisputed that it is anti-competitive.

[00:08:51] Speaker 02:
Everyone agrees about that.

[00:08:53] Speaker 02:
It's also undisputed that the FAA

[00:08:56] Speaker 02:
acknowledged in the 2006 order, the first order, that it knew that Congress mandated the phase out of the high density rule because of this anti-competitive methodology.

[00:09:11] Speaker 02:
And I want to just a brief sidetrack here.

[00:09:14] Speaker 02:
The word phase out in the Wendell Ford Air 21 Act is not because Congress intended in January of 2007 that that would be the beginning of a gradual phase out of the HDR methodology.

[00:09:30] Speaker 02:
The word phase out is there because Congress required the

[00:09:36] Speaker 02:
to eliminate the HDR methodology at AuPair in 2002, and the Congress gave FAA another four and a half years to solve the problem at JFK and LaGuardia.

[00:09:48] Speaker 02:
So, as of January 1, 2007, there should not be this anti-competitive methodology that is allocating slots at JFK and LaGuardia.

[00:09:59] Speaker 02:
The FAA has acknowledged from the beginning that this is anti-competitive and it's imperfect,

[00:10:04] Speaker 02:
and that it was never intended as a long-term solution.

[00:10:09] Speaker 02:
The 2006 order says that they expected to develop a, quote, better policy with help from noticing comment, and that the final order, quote, should establish a more rational basis, end quote, for regulating

[00:10:25] Speaker 02:
flights at LaGuardia.

[00:10:27] Speaker 03:
And Mr. Blair, you're again on the standing.

[00:10:30] Speaker 03:
There are some third parties that would have to act in a way conducive to your client in order for your client to benefit from an order from this court, such as the airports themselves and how they allocate gates and resources.

[00:10:48] Speaker 03:
There's some mention in the government's brief of

[00:10:51] Speaker 03:
international agreements that are timed in reliance on slot availability by the International Airlines slot availability of New York.

[00:11:04] Speaker 03:
How is it that those third-party actions don't render the relief that you seek too speculative or contingent?

[00:11:16] Speaker 02:
Good question, Your Honor.

[00:11:18] Speaker 02:
I would say that as to the airports, they have the same financial incentive that was found sufficient in Teton and La Pelletier.

[00:11:29] Speaker 02:
The economic incentive to cooperate was found sufficient to satisfy the redressability prong there.

[00:11:38] Speaker 02:
The airports would have an additional revenue stream if exhaust lists were permitted to help them solve airport congestion.

[00:11:50] Speaker 02:
What exists now is a complete market failure from every perspective, right?

[00:11:54] Speaker 02:
Passengers can pay more to go in the shorter security line, they can pay more for more leg room, but there's no amount of money that anyone can pay to increase their chances of arriving when they're supposed to arrive.

[00:12:07] Speaker 02:
Right?

[00:12:07] Speaker 02:
Same from the airline's perspective.

[00:12:12] Speaker 02:
They would like to provide better service, but they can't provide better service.

[00:12:16] Speaker 02:
And one example of that is when New York passed the Passenger Bill of Rights, the ATA sued to challenge that, right?

[00:12:24] Speaker 02:
And it's not because airlines like keeping people in airplanes for hours on end.

[00:12:30] Speaker 02:
It's that they understand that that's an unfortunate reality of today's system.

[00:12:36] Speaker 02:
that sometimes that happens and they have no power to solve it.

[00:12:43] Speaker 02:
In the ATAV DOT case in 2010, there's discussion of individual airlines don't have the power to solve this problem.

[00:12:53] Speaker 02:
It's the tragedy of the commons.

[00:12:55] Speaker 02:
If one airline says, oh, I'm going to fly less during this time, other airlines are just going to fill that void.

[00:13:02] Speaker 02:
And I've run into my rebuttal time, so I'd like to reserve some time for rebuttal unless there are any questions now.

[00:13:08] Speaker 03:
Thank you.

[00:13:09] Speaker 02:
Thank you.

[00:13:10] Speaker 03:
Mr. Schultz.

[00:13:21] Speaker 00:
May it please the court, Benjamin Schultz on behalf of the FAA.

[00:13:24] Speaker 00:
I want to start by talking about standing, and specifically about the standing theory that petitioner really brings out in their reply briefing here in this court, because that's a theory of standing that assumes that airports have the power of their own accord to enact the exhaustless scheme if the FAA orders were vacated.

[00:13:41] Speaker 00:
That is legally wrong, and I'd like to explain several reasons why.

[00:13:45] Speaker 00:
The first reason is that it's preempted by federal law.

[00:13:48] Speaker 00:
And there's a key Supreme Court case here, City of Burbank versus Lockheed Air Terminal, and that's 411 U.S.

[00:13:54] Speaker 00:
624.

[00:13:55] Speaker 00:
It's a 1973 Supreme Court case.

[00:13:58] Speaker 00:
And that case stands for the proposition that when the FAA manages things like the efficient use of airspace and safety, and it's also about noise regulation, that that's an area where the states have no power to regulate.

[00:14:09] Speaker 00:
And both of the airports at issue here, LaGuardia and Kennedy, are managed by a bi-state entity that will be acting pursuant to New Jersey and New York law.

[00:14:18] Speaker 00:
And if you read that Supreme Court case, I just want to make clear that although you'll see that it's about a noise regulation, one of the premises that the Supreme Court starts with to go on to explain why the noise regulation is preempted is it says, of course, things like managing the efficient use of airspace and managing the safety of the airspace

[00:14:36] Speaker 00:
are things that are preempted, and then it goes on to say that the noise regulation interacts with those two, and so the noise regulation is also preempted.

[00:14:43] Speaker 00:
But since the premise of that is that the efficient regulation of airspace is something that the FAA has preemptive power to do, that's why this is something that the airports couldn't do.

[00:14:54] Speaker 01:
The FAA may have preemptive power, but if it's not exercised... It's field preemption, Your Honor.

[00:15:00] Speaker 00:
That's correct.

[00:15:01] Speaker 00:
Your Honor, the Supreme Court said that what that statute does is it completely eliminates the ability of the states to regulate... So is that what really happens in the real world?

[00:15:07] Speaker 01:
So is there no airport that has a separate agreement about how it's going to...

[00:15:12] Speaker 01:
or separate arrangement that's not sanctioned, officially authorized by the FAA's involvement?

[00:15:20] Speaker 00:
I'm unaware of any airport that has managed congestion in the way the petitioner is talking about.

[00:15:26] Speaker 00:
Now, I do want to talk about- What do you mean by that, in the way that they're talking?

[00:15:29] Speaker 00:
I think what you heard petitioner reference in his argument today was certain congestion management fees, and that's a separate issue.

[00:15:36] Speaker 00:
What that is, is that, and there's a bit of history here, and I apologize that because this is something that came out in the reply brief, there's a lot of detail, and I want to make sure that the court gets it.

[00:15:45] Speaker 00:
But if you read this court's 2010 opinion in Air Transport Association versus Department of Transportation, that's 613 F3R 206, then there are things,

[00:15:56] Speaker 00:
called grant assurances that airports who take federal funds have to make to the F.A.I.

[00:16:02] Speaker 00:
and JFK and LaGuardia are airports that have received federal funds in this way and they've made these grant assurances and this court has explained that one of the assurances is that the airport be available for public use on reasonable conditions and without unjust discrimination and this court has explained that that

[00:16:17] Speaker 00:
means, among other things, that the airport can only charge, quote, reasonable fees to airlines.

[00:16:23] Speaker 00:
And then there's a separate statute, and this is 49 USC 47129 B2.

[00:16:29] Speaker 00:
And that statute gives the Secretary of Transportation authority to establish standards or guidelines to use when determining the fees are reasonable.

[00:16:37] Speaker 00:
And then if you go look in those standards and guidelines, which are published in the Federal Register, and those are what was at issue in the air transport case, those standards and guidelines explain that in certain circumstances, airports can charge landing fees to airports that in some way take congestion into account.

[00:16:56] Speaker 00:
But it is a very, very narrow way that they are permitted to take congestion into account, because at the end of the day, what the airport charges cannot exceed the reasonably allocated costs to the airport of having the airport land.

[00:17:10] Speaker 00:
And that is in no way what Exosceles is proposing to do.

[00:17:13] Speaker 00:
Theirs is not a cost-based system.

[00:17:15] Speaker 00:
Theirs is a pure market-based system.

[00:17:16] Speaker 00:
They want to have an option in which the price of a slot will just be whatever the market would bear, which is in no way authorized

[00:17:22] Speaker 00:
by these guidelines.

[00:17:23] Speaker 00:
And if you look, in fact, at what the guidelines are saying, all they're saying is that if you want to have this congestion management fee, which is permitted under the current system, by the way, these congestion management fees have a different way of computing costs in certain congested airports, so that, for example, if an airport is really congested, some of the costs that you can include as part of the airport's underlying costs are the costs of building outlying secondary airports.

[00:17:48] Speaker 00:
And there's a methodology there for how you take that into account.

[00:17:51] Speaker 00:
And again, no airport has even voluntarily done that, which is permitted under the current system.

[00:17:56] Speaker 00:
So it can't be that what they are asking for here is for the Port Authority, which manages JFK and LaGuardia, to have the ability to charge those landing fees.

[00:18:05] Speaker 00:
If the Port Authority wants to do that,

[00:18:07] Speaker 00:
It can do that.

[00:18:08] Speaker 00:
It just has elected not to do that for whatever reason.

[00:18:10] Speaker 00:
What they're proposing is a wholly different, not cost-based system.

[00:18:14] Speaker 00:
It's a market-based system.

[00:18:15] Speaker 00:
And it's not permitted.

[00:18:16] Speaker 00:
It would be an unreasonable fee within the meaning of that prohibition.

[00:18:20] Speaker 00:
So I think that just shows right there why the airports, for two separate reasons, preemption and the grant assurances, will be wholly unable to implement the exhaustive solution.

[00:18:29] Speaker 00:
There's actually a third reason that separately legally bars the solution.

[00:18:33] Speaker 00:
And that's because if you look at what they're proposing, it's not just one option.

[00:18:36] Speaker 00:
It's two.

[00:18:37] Speaker 00:
They're proposing two interrelated options.

[00:18:39] Speaker 00:
And the second option is this congestion premium that passengers are supposedly going to pay.

[00:18:45] Speaker 00:
The problem is that if the way you implement that premium is via the airport, so in other words, the airport has been requiring the airlines to charge these premiums to the passengers,

[00:18:55] Speaker 00:
you run smack into the prohibition of the Anti-Head Tax Act, and that's 49 U.S.C.

[00:19:00] Speaker 00:
40116b.

[00:19:03] Speaker 00:
And with exceptions not pertinent here, that says that various state entities, including bi-state entities, which is the Port Authority, quote, may not levy or collect a tax, fee, head charge, or other charge on, among other things, an individual traveling in air commerce, the transportation of an individual traveling in air commerce,

[00:19:21] Speaker 00:
the sale of air transportation, and that's exactly what Exaustus is proposing.

[00:19:26] Speaker 00:
So, you know, if they want to say that the FAA should implement the solution, we can talk about all the reasons why they lack standing to do that, but it can't be the air.

[00:19:33] Speaker 01:
So on this, so just as a matter of conceptual architecture, so you've, what you've raised is three legal obstacles to their getting home on their theory of regressibility that surfaced in the reply brief.

[00:19:46] Speaker 01:
I think usually under our decisions, the fact that there may be a legal obstacle remaining doesn't mean that there's not redressability with respect to a legal obstacle that's eliminated, because you give the plaintiff the benefit of the doubt on whether they're going to prevail ultimately on some merits theory that might carry them through some other legal obstacles.

[00:20:07] Speaker 00:
Well, that's actually not this court's case law, and we've actually cited two of the cases in our brief.

[00:20:12] Speaker 00:
Let me point you to the correct page.

[00:20:15] Speaker 00:
This is, I think it's the Delta construction case.

[00:20:18] Speaker 00:
That was a situation in which you had somebody who was challenging a regulation, but there was a consent decree that independently barred it, and the court found that they lacked standing because eliminating the regulation would not be enough.

[00:20:29] Speaker 00:
And then there is one additional case that we cited.

[00:20:32] Speaker 00:
This is on page 21 of the government's brief.

[00:20:35] Speaker 00:
It's also the, I'm sorry, the Crete Carrier Court, Crete Carrier Court was about a consent decree independently barring something in a Delta construction,

[00:20:43] Speaker 00:
was a situation where you had to challenge to one EPA regulation, and then there was another regulation that also independently barred relief.

[00:20:49] Speaker 00:
And again, because the petitioner was only challenging one of those regulations, the court held that they lacked standing.

[00:20:54] Speaker 01:
So then your view of the doctrine is that we actually go ahead and address the merits of the remaining legal obstacles in our first decision to decide whether there's regressibility?

[00:21:04] Speaker 01:
That's how you read those decisions.

[00:21:06] Speaker 00:
I mean, if the court wants to say that they have a way of this new theory by not bringing it in their opening brief, do you think that one way that the court could reason this out is it could say, you know, because of preemption or because of the grant assurance or because of whatever other legal reason, then you lack standing because there is no way to get the relief that you want, even if the orders are vacated.

[00:21:28] Speaker 01:
And is there anything factually so I'm not saying I don't buy that argument.

[00:21:34] Speaker 01:
Sure.

[00:21:34] Speaker 01:
But is there anything that is a matter of real world on the ground facts that would pose what the agency would view to be a significant obstacle in the way of proceeding in the way that

[00:21:46] Speaker 00:
Sure, absolutely.

[00:21:47] Speaker 00:
I mean, one of them is that the operator of these two airports, the Port Authority, one of the entities that sued the agency in 2008 when it had a much more modest slot auction regime.

[00:21:57] Speaker 00:
And if the Port Authority was willing to sue over a system in which you had only about 5% of the slots allocated versus via an auction, it's hard to imagine that the Port Authority would be willing to countenance petition or solution.

[00:22:08] Speaker 00:
And that's just the slot auctions.

[00:22:09] Speaker 00:
That's to say nothing about the international effects, all the practical problems that we've addressed.

[00:22:17] Speaker 00:
Be happy to address any more of the standing or the merits if the court has questions.

[00:22:22] Speaker 00:
Otherwise, I think it's all been adequately addressed.

[00:22:25] Speaker 03:
Is progress being made?

[00:22:27] Speaker 03:
I mean, it is striking to look at the amount of time that's passed and the problems seeming to be intractable.

[00:22:33] Speaker 03:
Is there any comfort out there that the FAA, if cases like this aren't allowed to proceed, is going to find a way?

[00:22:44] Speaker 00:
Sure.

[00:22:45] Speaker 00:
It's my understanding that the FAA does want to have a permanent rule.

[00:22:48] Speaker 00:
And I don't know how long that will take, but that is their desire.

[00:22:52] Speaker 00:
And if it gives the court comfort, our argument is not in any way saying that if there's an airline out there and they don't have slots at LaGuardia and Kennedy and they want them, or they have a certain number of slots at LaGuardia and Kennedy and they want more, we're not saying that they can't bring such a challenge.

[00:23:06] Speaker 00:
It would seem like they are directly regulated by this regulatory scheme.

[00:23:10] Speaker 00:
What we're saying here is that this isn't an entity that is not regulated by the scheme.

[00:23:15] Speaker 00:
It doesn't say it wants slots.

[00:23:16] Speaker 00:
it flies in and out of LaGuardia, it's just saying we think we can manage congestion better than the FAA.

[00:23:22] Speaker 00:
All we're saying in this case is that that entity lacks standing.

[00:23:41] Speaker 02:
Whereas I want to address maybe the last point first about other periods could come in.

[00:23:47] Speaker 02:
I think that that is an illusory consideration at this point, given that there's already been 12 years of delay on top of the six years of delay that they didn't find a way to come up with a permanent solution when Congress mandated the elimination of this anti-competitive methodology by 2007.

[00:24:05] Speaker 02:
In fact, they've never actually defended

[00:24:07] Speaker 02:
the merits of these temporary interim solution anti-competitive measures.

[00:24:12] Speaker 02:
The best that they've ever said is that it's better than nothing.

[00:24:15] Speaker 02:
And every time that they have tried a proposed permanent solution or a long-term solution, they've said that the interim measures are anti-competitive and they're not good enough.

[00:24:27] Speaker 02:
And the general counsel for Department of Transportation testifying that it's not an efficient way to allocate resources and that government shouldn't be picking winners and losers and that the system without using market forces

[00:24:40] Speaker 02:
encourages incumbent carriers to exclude everyone else.

[00:24:44] Speaker 02:
And this idea that other carriers could come in, the current orders go for another two years, and we've already passed the 60-day point to petition for review of those orders.

[00:24:54] Speaker 02:
So we have to live with these for another two years, and another carrier could come in then.

[00:24:58] Speaker 02:
On the surface, it seems reasonable, oh, just have a carrier come in, but the carriers can't do that for at least another two years.

[00:25:09] Speaker 03:
They could petition for a rulemaking.

[00:25:12] Speaker 02:
They could petition for a rulemaking.

[00:25:14] Speaker 02:
And given the FAA's history, you know, I'm not optimistic that that would move very quickly.

[00:25:19] Speaker 02:
And so that may even take longer than waiting two years to challenge the next extension of these temporary interim measures.

[00:25:27] Speaker 03:
I mean, it's not clear which way that cuts.

[00:25:29] Speaker 03:
It seems like this is a complicated problem.

[00:25:32] Speaker 03:
And when they've tried, they've found it to be harder than maybe Congress realized.

[00:25:37] Speaker 03:
And then the agency maybe at first realized.

[00:25:40] Speaker 02:
Well, Your Honor, that reminds me of the Nader case where that was a very complicated case involving tariffs, cross subsidies.

[00:25:49] Speaker 02:
And this court said that nine years is long enough for any agency to decide any issue.

[00:25:56] Speaker 02:
I mean, that case had all the same elements.

[00:25:58] Speaker 02:
The agency was claiming that conditions on the ground are changing.

[00:26:02] Speaker 02:
And it's very complicated.

[00:26:04] Speaker 02:
And it seemed kind of similar.

[00:26:05] Speaker 02:
They were doing a phase.

[00:26:07] Speaker 02:
They would try something and then pull it back and then try that.

[00:26:09] Speaker 02:
And the court said, no, at 10 years, there's this risk that you're going to lose public confidence and the regulatory system is going to break down because the public and the industry can't wait 10 years for agencies to make tough decisions.

[00:26:24] Speaker 02:
On the new arguments that have been raised here today, I just want to say that the 2010 ATA case says that airports can use this authority, one, and two, it says that it's entirely reasonable to expect airlines and passengers to pay more to fly at peak times.

[00:26:48] Speaker 02:
As to the third point about the second auction that opposing counsel mentioned, again, that is part of the proposed petition for rulemaking that's outside the scope of this case.

[00:27:03] Speaker 02:
Again, Your Honor, I would not say that it was a shift

[00:27:05] Speaker 02:
in theory, I would say it was a shift in emphasis.

[00:27:08] Speaker 02:
We had to include that and wanted to include that to show that this was a serious effort.

[00:27:14] Speaker 02:
This is a serious proposed solution.

[00:27:16] Speaker 02:
The FAA can accept or reject it on the merits, but they have not done that.

[00:27:20] Speaker 02:
And they have not made a serious enough effort to try to come up with a long-term solution.

[00:27:25] Speaker 02:
They keep kicking the can down the road, down the road with these supposed temporary interim measures that everyone agrees are anticompetitive.

[00:27:34] Speaker 03:
Thank you.