D.C. Circuit Remands Airline Antitrust Claims to DOT

In Alaska Airlines Inc. et al. v. U.S. Department of Transportation, U.S. Circuit Court for the District of Columbia has ordered the U.S. Department of Transportation to reconsider antitrust allegations by Southwest Airlines Co., US Airways Group Inc. and other airlines that Los Angeles International Airport and the city of Los Angeles unfairly discriminated in hiking the maintenance fees and rents at two terminals while leaving the same costs untouched for airlines with longer leases.  While ruling that LAX was within its rights to raise maintenance and occupancy fees for the airlines, the panel held that the DOT must explain on remand why the case does not present the “extraordinary situation” in which alleged monopoly power is relevant to a fee dispute.  If it cannot, the court will go on to consider whether LAX had monopoly power in its geographic market.  The panel also held that the DOT must 1) either justify or abandon its objection to the city’s considering non-aeronautical uses when setting terminal rents; and 2) consider the claims of airlines operating out of both terminals in question equally. 

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