NORTHWEST AIRLINES, INC. v. COUNTY OF KENT, MICHIGAN
Legal provision: 49 U.S.C. 1513
Argument of Walter A. Smith, Jr.
Chief Justice Rehnquist: We'll hear argument next in Number 92-97, Northwest Airlines, Inc., versus the County of Kent.
Mr. Smith: Mr. Chief Justice, may it please the Court:
The Court has agreed in this case to decide whether the user fees that are imposed on the airlines and their passengers at the Kent County Airport are reasonable within the meaning of the Federal aviation laws and within the meaning of the Commerce Clause.
All parties here appear to be agreed that the criteria by which the Court should decide this question are those set out by the Court in the Evansville decision, and we believe those are the minimum criteria that the Court ought to apply in this case, and when the Court applies those criteria, we believe the Court should find that the methodology used by Kent County in fact violates the criteria in at least three different ways.
First, the fee methodology is not based on a fair approximation of use by the various users at the airport... that is, that the costs are not fairly allocated among users... second, the revenues that are produced by the fee methodology are vastly in excess of the airport's own costs in delivering service to the users, and finally, the airport's fee methodology deliberately discriminates against the airlines in favor of local aviation.
I would like to comment on each of these three requirements, and then, if time allows, I would also like to comment on an issue that we do not think is properly before the Court, but that the Solicitor General and the airport do... that is, whether or not, even if the fees are unreasonable, whether the airlines are permitted to bring a legal action to challenge them.
So let me start if I may with--
Unknown Speaker: That would be the private right of action point?
Mr. Smith: --Yes, Your Honor.
Unknown Speaker: And that is one of the questions presented in the petition, is it not?
Mr. Smith: It is not, Your Honor.
It was not presented in the petition, and it was not raised in the cross-petition, and in our view it is not properly before the Court.
Unknown Speaker: Very well.
Mr. Smith: Nevertheless, we realize the Court may elect to reach it, so we have briefed the matter in our reply brief.
I was going to start with the allocation issue first.
Under this Court's Evansville decision, airport fees must, in the first instance, be based on what the Court called 7, this means that the fee should not be higher than the airline's properly allocated costs, but in our view, this airport has not even attempted to comply with this requirement.
As the Court knows, at this airport, as at most, there are two main groups of users.
There are the airlines on the one hand, and the concessions on the other.
Both of these two groups of users benefit significantly from costs that the airport expends on what are called the air operations costs, and the reason for that is, without the airport spending money on taking and landing... takeoff and landing facilities, there would be no customers, either for the airlines or for the concessions, and for that reason, in our view, in order to fairly approximate the use, the airport was required to allocate at least some of the costs to the concessions, but they did not do so.
They allocated none of the costs to the concessions, and the result necessarily was, and mathematically so, as Judge Flaum found in the Indianapolis decision, the fair share of the costs to the airlines was too high.
They were in fact paying more than their fair share of the cost.
Unknown Speaker: Mr. Smith, how many other Federal statutes are there that confer ratemaking responsibilities upon Federal courts?
I mean, that is essentially what you're asking us to engage in here, isn't it, the whole process of ratemaking?
Mr. Smith: I think not, Your Honor.
Unknown Speaker: You're saying what you're entitled to are reasonable rates, which are going to be determined by Federal courts.
I know one Federal statute that requires that.
I don't know any others.
Mr. Smith: I think the court is often in the business of determining whether or not impositions made by a State in the form of user fees are reasonable.
After all, Evansville was a Commerce Clause decision, and we believe when Congress adopted the AHTA it essentially adopted in part the Evansville requirements, and the Court has often decided other cases where reasonableness in that context was required to be decided.
Unknown Speaker: You don't allow any profit in your assertion of reasonableness.
As I recall, one of the elements you've challenged was including within it what interest payments would have been made had they borrowed the money in order to provide these facilities.
Mr. Smith: I think that's right.
Congress intended that--
Unknown Speaker: In normal ratemaking, you're allowed a fair return on your capital.
Why isn't that reasonable?
Mr. Smith: --Not under the AHTA, Your Honor, because under the AHTA Congress recognized that the vast bulk of the revenues that fund airports are going to come from the Federal Government through taxes paid by passengers, and Congress wanted no further additional fees to be imposed on users of airports except those that would be absolutely--
Unknown Speaker: But the reason--
Mr. Smith: --necessary to keep... and to keep the airport self-sustaining.
That's the word in 2210.
Unknown Speaker: --So you'd allow depreciation, would you?
Mr. Smith: I'm sorry, Your Honor?
Unknown Speaker: Is depreciation absolutely necessary?
Mr. Smith: They can recover their costs, Your Honor, and to the extent they had costs that they had to expend to purchase assets to serve users.
They can recover their costs, but--
Unknown Speaker: And can they retain some of those costs for future construction?
Mr. Smith: --I think they can, Your Honor, so long as they are costs absolutely necessary for additional assets or for replacement of assets.
Unknown Speaker: Well, the airport is saying here, you know, we're facing construction fees on reasonable projections of... you know, multiple millions of dollars, so there's nothing for example, terribly impressive about this surplus of $9 million, if they could anticipate future expense to that extent in, as you put it, recovering their costs.
Why is it wrong for them simply to, in effect, put the same amount of money aside calling it a surplus?
Mr. Smith: Because, Your Honor, here they accumulated surpluses far beyond airport needs.
As we show, that--
Unknown Speaker: Well, airport needs judged at what point, at what time?
Mr. Smith: --Defined even by the airport itself, Your Honor, after they had met all of their costs, all of their debt service, and had purchased every conceivable future capital expenditure that they could think of in their wish list all the way through the end of the decade, this airport still has substantial surpluses left over.
In fact, the airport was asked at trial, their expert witnesses, what were the purposes of these additional revenues?
Unknown Speaker: Weren't those surpluses generated by payments from the concessioners, not from the airline?
Mr. Smith: Part of them were, Your Honor.
Unknown Speaker: I thought it all was, basically.
Mr. Smith: No, Your Honor--
Unknown Speaker: I mean, the reason they have a surplus is the payments from the concessioners.
Mr. Smith: --No, Your Honor, that isn't so, because if they had fairly allocated costs at this airport it would then have become apparent that the surpluses are coming from the airlines, and if they hadn't attempted to recover their assets two and three times over through this mythical mortgage of pretending there was an 8-1/2 percent mortgage attached to assets they had acquired, they were recovering surpluses from the airlines through the mythical mortgage--
Unknown Speaker: Isn't it true that under--
Mr. Smith: --something on the order of $1 million a year.
Unknown Speaker: --under the Federal law, whatever surplus is there can only be used for airport purposes, it can't be diverted to general State coffers?
Mr. Smith: That is correct, Your Honor, but as the Solicitor General points out in his brief, revenues may not be accumulated indefinitely or in unlimited amounts, and what has happened here is--
Unknown Speaker: If that's true, that's a violation of a different statute.
You don't claim a cause of action under the Airport and Airway Improvement Act, do you?
Mr. Smith: --No... well, we did below, Your Honor.
Unknown Speaker: It's a violation of that statute that you're describing.
Mr. Smith: We believe, Your Honor, that when--
Unknown Speaker: Or perhaps a violation.
Mr. Smith: --when Congress imposed the requirement of reasonable fees, it did so in the light of the requirements of the grant assurance provisions, which all parties here have agreed ought to be taken into account in determining the meaning of reasonableness in the AHTA.
Unknown Speaker: Is it essential to your case that there be a finding that there has been an unreasonable surplus that violates section 2210?
Mr. Smith: No, Your Honor.
If you agree with us on the allocation question, then the methodology has to be set aside on that ground alone.
Unknown Speaker: And I wonder if there was any duty to... the duty in that section is to spend the money on airport improvements, and they... you're not alleging they've spent the money on anything else, and then the Government says, you also can't accumulate too large a surplus, but I don't know that you've alleged they've accumulated too large a surplus, have you?
Mr. Smith: We have alleged, Your Honor, that they have to have some evident purpose for the surplus.
Congress intended that they--
Unknown Speaker: In order to avoid the violation of that statute.
Mr. Smith: --In our view, Your Honor, the reasonableness of requirement of AHTA must be read in light of the AAIA, and its requirements that the airport only earn enough to be self-sustaining but not so much as to create financial windfalls.
I mean, as the Court knows, the only explanation--
Unknown Speaker: If there were no section 2210, they could go into the business of selling parking spaces and so forth and make all the money in the world and not use it on the airport.
It's only because of the existence of 2210 that you have a claim based on the excess surplus.
Mr. Smith: --I think that's not right, Your Honor.
I think that the reasonableness requirement from Evansville on the surplus issue... and let me read from the Court--
Unknown Speaker: Now, Evansville was a dormant Commerce Clause case?
Mr. Smith: --Right.
It was a Commerce--
Unknown Speaker: And you think that the dormant Commerce Clause analysis means that you achieve this result?
There can't be a surplus?
Mr. Smith: --I think, Your Honor, the requirement--
Unknown Speaker: That strikes me as a very tough argument to make.
Mr. Smith: --Well, let me try to persuade you otherwise.
The requirement of Evansville was that an airport not receive... receive funds that exceed the airport's costs and should do no more than meet past as well as current deficits, and we think in the AHTA Congress in fact intended to go further than that and impose even stricter requirements on an airport than even those the Court had imposed in Evansville, and this is an airport that has gone far beyond even what this Court would have permitted in Evansville.
Unknown Speaker: But Evansville was dormant Commerce Clause, and certainly your principal case here isn't under the dormant Commerce Clause, is it?
Mr. Smith: No, the principal case, Your Honor, is under the AHTA, which was adopted by Congress in light of the Evansville decision expressly, and the AHTA was intended by Congress to go even further than this Court had gone in its dormant Commerce Clause.
Unknown Speaker: What's your authority for that proposition?
Mr. Smith: Oh, the legislative history, Your Honor, of the AHTA, which is cited in our brief, makes clear--
Unknown Speaker: But... you know, we have a section of the statute here.
Why go back to the legislative history?
Mr. Smith: --Well, Your Honor, the meaning of the word that's here at issue is the word AHTA, and we believe that the Court should interpret the meaning of the word AHTA was adopted, and that purpose was to strengthen the requirements of Evansville, and if Evansville would not have permitted the surpluses that have been developed by this airport and we--
Unknown Speaker: Where does Evansville say you can't have surpluses?
Mr. Smith: --Well, Your Honor, I started to read from Evansville... we say that what this airport has done violates Evansville because that case says at 404 U.S. at 720,
"the funds received by local authorities should not exceed airport costs and should do no more than meet passed as well as current deficits. "
This airport, when asked to explain surplus in this case, as you know, either said they didn't know what the purpose of it was--
Unknown Speaker: But you're using a case that was... in which the airport succeeded in retaining its charges, right?
Wasn't that the case in Evansville?
Mr. Smith: --No.
In fact, Your Honor, the opposite was true.
In that case, the Court found expressly, in applying the criteria of the Commerce Clause, that in that case the airport had not received more revenues than were necessary to make--
Unknown Speaker: That's what I mean.
Mr. Smith: --Yes... sorry.
Unknown Speaker: The airport won the case, and you're using that case to say, but in this case the airport loses.
Mr. Smith: Yes, because the Congress said in letting the airport win, the Court didn't apply as strict prohibitions as it should have, and the Congress went further in the AHTA.
Unknown Speaker: And said, no head tax.
Mr. Smith: It said a lot more than no head tax, Your Honor.
It prohibited all charges, fees, head taxes of any kind, on passengers either directly or indirectly or on the carriage of air transportation.
Unknown Speaker: Mr. Smith, now, you could... your client could have gone the administrative route, I guess, here--
Mr. Smith: Presumably so.
Unknown Speaker: --to make its complaints about these charges.
Mr. Smith: Yes, Your Honor, that contention is made here, but we believe Congress didn't require us to do that, and certainly didn't make it administratively exclusive.
Unknown Speaker: And in any event, no effort was made here to go administratively.
Mr. Smith: None was made, Your Honor.
None was made in part because Congress, when it adopted the AHTA, didn't give any authorities directly to the Secretary to act in this area at all, and in fact the Secretary to our knowledge had very little experience or expertise in determining the reasonableness of fees.
Unknown Speaker: He already decided one case, at least, involving the reasonableness of fees, didn't he?
Mr. Smith: --The Secretary?
Unknown Speaker: Yes.
Mr. Smith: I believe so, Your Honor.
Only one, and I believe it's from Massport, the Logan Airport case, and of course, that case came in 1988-1989, which was some 15 or 16 years after the AHTA was adopted, and at the time it was adopted, to my knowledge there had been no cases in which the Secretary had actually reviewed the reasonableness of fees.
Unknown Speaker: In your view, does the Secretary have the authority to make any more refined or precise allocations than does a court when you bring an action before the court rather than the agency?
Mr. Smith: He may, Your Honor, but the very policies that the Solicitor General describes that are the views of the Secretary are very much our own.
I mean, although he opposes them from--
Unknown Speaker: From your standpoint, a court can do whatever the agency can do, and vice versa, in this area of allocating?
Mr. Smith: --Perhaps not, Your Honor.
What we're asking you to do here is simply apply the bright line test of Evansville, and because we think all three of those bright line tests--
Unknown Speaker: The point of my question is, is to the extent the Court thinks that what you're asking for is simply too cumbersome and precise for courts to be involved in, if there's an equivalency, then it follows that the agency can't be involved in it, either.
Mr. Smith: --Well, Your Honor, as I say, we are not in this case, contrary to what the airport says, asking this Court to become involved in the intricacies of ratemaking.
We are merely asking the Court to apply the three bright line tests of Evansville, which, of course, was a case that merely applied bright line tests to the--
Unknown Speaker: When, when we decide the adequacy of a surplus and allocations between fuel taxes and other sorts of charges, it seems to me that's very close to ratemaking.
Mr. Smith: --Your Honor, with regard to allocation, we would merely ask the Court to require the airport to come up with some kind of allocation.
Unknown Speaker: Well, all we can do is decide this case, Mr. Smith.
Other courts, if your view prevailed, would be deciding lots of other cases, and we'd have the Indianapolis airport in the Seventh Circuit perhaps coming out different from the Grand Rapids airport in the Sixth Circuit.
At least if it went to the Secretary, the Secretary could establish a uniform system for the whole country, or the same machinery would be applied to determine reasonableness.
Mr. Smith: We think the uniform system that's described in the Secretary's policies, as stated in the S.G.'s brief, are the same ones we are espousing.
Unknown Speaker: You can have the same standards, but if you turn them over to 93 different district courts to apply, you're probably going to get a lot more differences than if you have one administrative agency applying them.
Mr. Smith: I would suggest not, Your Honor.
The difference between the Sixth and Seventh Circuits that are now before the Court are fundamental differences about how to apply the Evansville standards, and if both parties had gone to the Secretary first in those two cases, there still would have been an appeal available to the circuit courts from the Secretary's decision, and we would still have had a difference of opinion about what the meaning is of the word reasonable in the AHTA.
Unknown Speaker: You say all we're talking about is applying the Evansville standards.
Well, certainly it isn't apparent from the face of the statute that we're talking about here that it incorporated the Evansville standard.
All it uses is the word "reasonable".
Mr. Smith: That is true, Your Honor, and when the judicial action is brought, of course, the courts are required, as both the Sixth and Seventh Circuit recognized, to determine what Congress intended when it used the word "reasonable" in this statute, and both of them, in fact all of the many courts that looked at the issue, have agreed that what Congress was doing was in fact strengthening the prohibitions of the Evansville decision.
That was the entire--
Unknown Speaker: That may be one reason why we should decide there isn't any private right of action.
Mr. Smith: --Well, of course, Your Honor, we don't think you should decide there isn't a private right of action unless that's what Congress contemplated.
Unknown Speaker: Well, naturally.
Are you... you said you were going to address that?
Mr. Smith: Yes.
Unknown Speaker: Before you get to that, even your statement that it's clear from the legislative history that Congress was strengthening the Evansville standards, I mean, that leaves a lot of running room.
You're strengthening standards developed for dormant Commerce Clause purposes.
Strengthening them to what extent?
All we know is that they were strengthen... strengthening them to what extent?
To the extent that from now on it's going to have to be reasonable... not just enough to comply with the dormant Commerce Clause, but reasonable... and it seems to me it leaves open the whole field of ratemaking.
Mr. Smith: Well, except for the fact that this Court itself was in substance, in Evansville itself, deciding what were reasonable fees.
Unknown Speaker: Well, that may have been an erroneous approach under the dormant Commerce Clause.
What other examples can you think of where in a dormant Commerce Clause we decided we have to get into reasonableness of rates?
Mr. Smith: Your Honor, I would suggest to you that in all of your Commerce Clause decisions where fees or taxes or impositions by a State are being imposed on Commerce, you are in effect deciding... you do this in the Complete Auto--
Unknown Speaker: Well, isn't the Court looking more at whether there's a discrimination or an excessive burden on interstate commerce?
Isn't that the focus?
Mr. Smith: --That is true, Your Honor, and we believe, in fact, we have an excessive burden on interstate commerce in this case for the reason that I've said, because we have an airport not fairly allocating its costs and producing revenues far in excess of costs.
Unknown Speaker: Do you know any case where we validate a discriminatory tax, discriminatory as to out-of-State participants, on the ground that the revenue is recovered by some other tax that's imposed on local entities?
I know of no such principle.
Mr. Smith: Are you talking about the justification that's been offered for the--
Unknown Speaker: Yes.
I'm just talking to that straight Commerce Clause analysis.
Mr. Smith: --I don't think--
Unknown Speaker: Do we compare two or three different taxes to see the total burden on all of the participants?
Mr. Smith: --I don't think this Court has ever--
Unknown Speaker: Correct me if I'm wrong.
Mr. Smith: --Well, I don't think this Court has ever approved what happened here on the discrimination point, which was essentially robbing--
Unknown Speaker: But has the Court--
Mr. Smith: --Peter to pay Paul.
Unknown Speaker: --ever entertained an analysis of a whole State's tax system to determine the burdens imposed upon interstate and... in-State and out-of-State participants?
We look at... simply at the tax on its face.
Mr. Smith: I think that's right, Your Honor, but I would suggest to you that inasmuch as the AAIA prohibits all manner of unjust discrimination among users, it wouldn't matter whether it was an interstate... interstate or intrastate commerce situation, that here, by undertaxing general aviation, they've made up the money they say by overtaxing the concessions, and of course, as the Court knows, the concession fees here are paid for by the passengers.
So once again the end result is that the total fees being extracted by this airport from the airlines and their passengers are vastly in excess of this airport's cost of delivering services to those users, and that is the precise thing that Congress intended to prohibit in the AHTA.
Unknown Speaker: Well, it seems to me that your argument is valid under the standard, conventional Commerce Clause analysis if you show a discrimination between general aviation and the commercial aviation, but when you then have the concessions, and you start balancing revenues, it seems to me that's a very strange dormant Commerce Clause argument.
Mr. Smith: Well, but we believe there is discrimination just by looking at how they treated general aviation as compared with the airlines, Your Honor.
Unknown Speaker: Mr. Smith, I'd like you to back up on one point.
Mr. Smith: Surely.
Unknown Speaker: Why do you equate general aviation with intrastate commerce and commercial with inter?
What in the record supports... I know you get it from a decision in the Seventh Circuit that made this comment offhand, but I don't see anything in this record that tells us that the general aviation category is intrastate.
Mr. Smith: There was not explicit evidence on that issue, Your Honor, you're right about that, and the reason there was not was because the district judge dismissed our Commerce Clause claim at the beginning, and if we prevail here that we were entitled to have at least raised a Commerce Clause contention, we believe we would be entitled on remand to adduce the kind of evidence that you're talking about.
Unknown Speaker: Well, did you allege in your Commerce... the Commerce Clause section of your complaint that the general aviation was intrastate and the airport was... airlines was commercial?
Mr. Smith: That was our position, Your Honor.
Unknown Speaker: I said, did you allege it?
Mr. Smith: I believe that we did, Your Honor, but I'm not certain.
Unknown Speaker: Because certainly the... I don't see really why you're entitled to a remand just because the district court dismissed your complaint, unless you brought that out in your complaint.
Mr. Smith: Well, I guess I would argue, Your Honor, as you know from our second presented question here, that if, in fact, we were entitled to raise our Commerce Clause claim, which was dismissed prior to trial, had he correctly allowed us to proceed on the Commerce Clause claim, we would then have attempted to adduce the kind of evidence that Justice Ginsburg is referring to.
Unknown Speaker: What was the basis for the district court's dismissal of your Commerce Clause claim?
Mr. Smith: I think it was that he thought because Congress had taken some action in this area that is, under the AHTA... we were precluded from bringing a Commerce Clause claim.
Unknown Speaker: It wasn't, then, as you understand it, a dismissal on the merits?
Mr. Smith: Oh, absolutely not, Your Honor.
He never reached the merits.
He thought when there was legislation in the area it necessarily precluded there being a Commerce Clause claim.
Unknown Speaker: Did you concede, and do you now concede, that under the statute the distinction between burdens on intrastate and interstate commerce are irrelevant... is irrelevant?
Mr. Smith: Are irrelevant, Your Honor?
Unknown Speaker: Yes.
Mr. Smith: We do not believe that for purpose of the AHTA, that we have to show, as the airport contends, that there was interstate as against intrastate discrimination.
Congress intended through the AHTA to prohibit discrimination against the airlines in favor of local aviation.
We cite legislative history in our brief to that effect.
Congress didn't limit it.
Nothing in the language of the statute or the legislative history suggested that Congress intended to limit discrimination only among competitors or only between interstate or intrastate users of an airport.
Unknown Speaker: Mr. Smith, may I ask you a question?
Just going to the excess profits made by the concessions and putting on one side the general aviation question for the moment, would your objection to that aspect of the case be cured if the county charged... cut the rent to the concessionaires in half, or whatever it was, so they did not make any profit any more out of the concessions?
They would continue to pay... charge the airlines exactly the same.
Mr. Smith: Your Honor, if they fairly allocated the costs between the two--
Unknown Speaker: No.
I gather those... the concession revenues and all, they make money by renting out parking spaces and the rental car agencies and things like that.
If they charged them a lesser rent so it was no longer quite as profitable as it is, would your objection then, to the reasonableness of the fees you pay, be cured?
Mr. Smith: --It would not, Your Honor, because they would still not be fairly allocating costs between the users.
They have not attempted by any measure that we know of to try to assess how much of the air side costs should be charged to the concession, and that's a point we make wholly apart from the fact that the airlines and their passengers together... and the airline passengers pay the concession--
Unknown Speaker: These costs you're talking about, are they costs in the terminal, or are you talking about runway maintenance, or what are you talking about?
Mr. Smith: --When we talk about unfair allocation, we're talking only about the air side costs as they benefit the concessions, and that they create the customers for the concessions.
Unknown Speaker: By air side costs, you mean the nonoperational stuff?
Mr. Smith: Exactly, Your Honor, all of those costs that produce the takeoff and landing facilities.
Unknown Speaker: Well, if they totally eliminated that, they just closed all those concessions but continued to operate the same runways and charge you the same... well, they couldn't do that, because they'd have to have the terminal then, I guess.
Mr. Smith: They would.
Unknown Speaker: The thing that puzzles me is that I don't understand you to be challenging the reasonableness of the charges for what you actually use.
Mr. Smith: But we do, Your Honor.
Wholly apart from the allocation issue, which is why our fees are too high, we also claim that they're not permitted to charge us for this 8-1/2 percent carrying charge.
Those are the two points we make about the fees that are assessed directly on us... misallocation and the carrying charge.
Unknown Speaker: Mr. Smith, are you going to say something about private right of access?
Mr. Smith: Yes, I was going to, Your Honor.
Unknown Speaker: I was very interested in that.
As I understand it, your point is that if we reach that issue, it's apt... and the Respondent is normally allowed to raise any issue to sustain the judgment below... you say it would expand the relief.
Why would it?
Mr. Smith: It would, because we won in part below, Your Honor.
Unknown Speaker: I--
Mr. Smith: You could not... because the Sixth Circuit ruled in our favor on a portion of our--
Unknown Speaker: --On the CFR costs.
Mr. Smith: --Exactly.
Unknown Speaker: That's the only item to which it would expand it.
They assert that the CFR costs have already been assessed and that whatever happens here it won't make any difference as to whether you get that... whether you get that relief.
Mr. Smith: Well, but--
Unknown Speaker: Is that true or false?
Mr. Smith: --That's false, because the Sixth Circuit affirmed in part and reversed in part, and that entire judgment is now before the Court, and the Court, if it now reaches the private right of action issue, cannot affirm this judgment.
It will have to modify the judgment to take away from us the victory that we won in the Sixth Circuit.
It would have to, as the telephone case said, expand the relief in favor of the Respondent.
Unknown Speaker: That issue's fairly well joined.
Mr. Smith: Thank you, Your Honor.
I'd save the remainder for rebuttal.
Unknown Speaker: Very well, Mr. Smith.
Mr. DuMont, we'll hear from you.
Argument of Edward C. DuMont
Mr. DuMont: Thank you, Mr. Chief Justice, and may it please the Court:
The United States appears today primarily to support Respondent's position that ratemaking disputes such as this one concerning user fees charged to air carriers by the Nation's numerous local airports belong initially in an administrative rather than a judicial forum.
Neither the Anti-Head-Tax Act on which petitioners' claim relies, nor the FAA... Federal Aviation Act of which it is a part... nor any other statute provides explicitly for the private enforcement of any right that may be conferred by section 1513(b), which petitioners rely on.
Unknown Speaker: If the airlines refuse to pay the fees, they would be sued in court, would they not?
In other words, the airport authority would simply take them into a State or conceivably a Federal court to collect the money?
Mr. DuMont: They might very well.
Unknown Speaker: Okay, so there's no way to insulate these issues from court review.
Mr. DuMont: Well, we think that proceeding would normally be brought in State court.
First of all, that issue arises whether or not there's a private right of action for the airlines affirmatively to go in and challenge those.
Unknown Speaker: Oh, I grant you that, but just in sort of making the calculus of what Congress might have assumed, Congress certainly did... presumably started with the assumption that there was at least some circumstances in which these issues would be litigated as between private parties and in the kind of action that we've got here, except that it would be brought by the airport on the airlines' refusal to pay.
Mr. DuMont: We think the Congress assumed, or intended, that these issues would be dealt with primarily by the Secretary, and... for instance, we believe that a State court faced with this issue might very well say one of two things, either that it would defer to the Secretary's determination of reasonableness, to the extent that was the issue, or that it would simply refuse to hold the fees unreasonable unless the airlines could produce evidence from the Secretary that the Secretary believed them to be so.
That would be a fairly conventional sort of deference to administrative agency primary jurisdiction theory.
Unknown Speaker: They must do that, or just... they'll be nice guys and will do it?
Mr. DuMont: We have no position on whether a State court would be required to do that.
We think it would be appropriate for a Federal court if the issue arose in that posture.
Unknown Speaker: Are there cases in which State courts apply the doctrine of primary jurisdiction with respect to a Federal agency?
I just don't know.
Mr. DuMont: I'm not aware of a specific case, Your Honor, no.
Unknown Speaker: I'm not, either.
So at least it's an open question in your mind as to whether or not, in a State court action, the anti-head-tax statute is valid Federal defense.
Mr. DuMont: We think that's an open question, yes, and we also think that, as I said, it arises no matter what the decision is on the private right question, and that the question should be looked at independently.
For instance, there are cases this court has looked at... for instance, the second Pennhurst decision, which quite clearly state the view that whether or not a Federal issue may be diverted to State court by the appropriate decision on a particular point of Federal law, that is simply a consequence that may be accepted.
Unknown Speaker: I should think the airlines and the Congress would be quite amazed that the enactment of the anti-head-tax statute took away a Federal defense in State courts.
Mr. DuMont: We think the defense remains in one guise or another, and for instance, we think it would be quite appropriate for an airline to pay this tax under protest and then either sue for a refund or, for instance, go straight to the Secretary at that point, having paid the tax, and ask the Secretary to entertain a reasonableness challenge.
If the Secretary finds that he has the authority to do that and that the fees are unreasonable, then we think the Secretary would have the authority to issue affirmative relief at that point to the airport authority requiring a refund of those fees.
Unknown Speaker: Mr. DuMont, what's your response to the assertion that none of this is properly before us because if we acknowledged your contention we would expand the relief below and therefore this can't be entertained?
Mr. DuMont: Well, as you said before, Your Honor, that issue is fairly joined.
We don't agree that this would expand the relief granted below in any way.
What the court of appeals said was that crash, fire, and rescue costs had been unreasonably allocated, and it remanded to the court... the district court to determine a reasonable allocation.
The respondents have not challenged that, so when this goes back to the district court, the district court can assess a reasonable allocation of costs for those particular fees, and that will control.
Unknown Speaker: The remand has not been challenged?
Mr. DuMont: The remand has not been challenged as it relates to crash, fire, and rescue costs.
Unknown Speaker: How do we determine that?
Mr. DuMont: The... because there was no cross-petition filed on that particular issue.
Unknown Speaker: But if we were to say there is no private right of action, then the respondent would lose the benefit of the... or the petitioner would lose the benefit of the remand on that issue.
Mr. DuMont: We don't think that's necessarily true, Your Honor.
Although the decision that there was no prior right of action would undercut the logical basis for the remand, the remand would remain the law of the case because it has not been challenged in this Court, and the Court decision would only affect the fact that no other issues could be resolved on remand in the district court.
Unknown Speaker: Even if we were to say there's no private right of action, nonetheless the case would go back to the district court for deciding the proper allocation of the CFR fees?
Mr. DuMont: Assuming the parties are not able to resolve that issue amicably in light of this Court's decision, it would go back for remand on that one particular issue.
Unknown Speaker: Well, if we were to decide this, that there's no private cause of action, is that jurisdictional, then, for the district court?
Would we be saying there was no jurisdiction there at all?
Mr. DuMont: We don't think so, again, Your Honor.
We think, for perhaps the same reasons that this issue cannot be raised no matter whether it was raised below or not, simply because it's jurisdictional, for those same reasons the jurisdictional question would not control, and although this Court's decision would remove the rest of the district court's authority with respect to the case, that particular remand which was not challenged would remain in the district court and could be resolved as a matter of law of the case.
Unknown Speaker: May I ask you a question about your argument on the merits, assuming it's here for a second.
You cite a case involving the Boston airport which arose under the Anti-Head-Tax Act.
Are there any administrative proceedings that have been pursued under the other statute, the Airport and Airway Improvement Act, where you've challenged an airport's building up an excess of surplus or improper use of funds that have accumulated?
Mr. DuMont: I'm not aware of a formal proceeding that has been brought under the AAIA on that issue.
Unknown Speaker: So there's really no law on this issue about whether a surplus can sometimes be too large, or something, or they can review it after the fact, because that statute speaks in terms of conditions for a monetary grant, as I understand it.
Mr. DuMont: There is no decisional law on that issue.
There is administrative law in the sense that the FAA has issued an order under the AAIA, among other statutes, providing, among other things, for standards for reasonableness for airport user fees, and that authority, that order, does talk about--
Unknown Speaker: But those would be standards that would apply--
Mr. DuMont: --the unlimited accumulation of surpluses.
Unknown Speaker: --in advance to future grants of money to... are there any proceedings where a particular airport authority has been punished in any way or sanctioned in any way for failure to comply with that statute?
Mr. DuMont: I'm not aware of any.
I believe most of those issues are resolved on an informal level.
Unknown Speaker: Before the money is delivered, yes.
Mr. DuMont: Before the money is delivered, or without the necessity to resort to a former adversarial proceeding before the Secretary.
Because none of the statutes involved here confers an explicit private right, we have to look to Congress' intent, and it is the petitioner's burden to persuade the Court that Congress, with the single word 1513(b), whose major function, after all, is merely to make clear that the head-tax prohibition of section 1513(a) does not apply to user fees, petitioners must rely on that one word "reasonable" to engage the district courts all over the country in what is essentially a ratemaking proceeding, and we think that quite clearly contravenes the intent of Congress in placing the Anti-Head-Tax Act in the Federal Aviation Act, which provides quite a comprehensive remedial scheme.
In the FAA, section 1354, which is reprinted on page 6a of our brief, provides broad general powers to the Secretary, section 1482 makes it clear that any person may file a complaint raising any sort of issue within the jurisdiction of the FAA... I might point out, for instance, that my colleague, Mr. Smith, on behalf of many of the same airlines who are involved in this proceeding, has filed such a complaint last Wednesday with respect to Los Angeles airports, again raising claims under the AAIA... thank you, Your Honor.
Unknown Speaker: Thank you, Mr. DuMont.
Mr. Hunting, we'll hear from you.
Argument of William F. Hunting, Jr.
Mr. Hunting: Mr. Chief Justice, and may it please the Court:
There is no precedent of this Court that mandates that a local governmental unit as owner and landlord must lease its facilities to a commercial tenant at rates that are less than the acquisition cost of the facilities so provided.
Likewise, there is no precedent of this Court that requires an airport to adjust its rates to one tenant based upon the varying business results of yet another different category of tenant.
The traditional fees at issue in this case are very simply landing fees and terminal rental rates, which clearly are permitted under the clarification language of section 1513(b) of the Anti-Head-Tax Act.
These charges being landing fees and terminal rental rates, are not direct or indirect taxes or illegal fees under section (a) of 1513 of the Anti-Head-Tax Act.
Unknown Speaker: You say, Mr. Hunting, that the crash, fire, and rescue charges are not at issue?
Mr. Hunting: They are not at issue, and if I could explain further--
Unknown Speaker: You agree that no matter what happens here, you've lost on that, and the district court should, on remand, decide that issue as though there is a private right of action.
Mr. Hunting: --Yes, but I need to define loss.
All the Sixth Circuit said was, it was inappropriate to allocate 100 percent of CFR costs to the commercial airlines.
Unknown Speaker: Right.
Mr. Hunting: We did not appeal that decision.
We do expect, depending on whether the remand holds up and whether they're amicable proceedings or not, to litigate before the district judge what percent less than 100 percent would be appropriate.
Unknown Speaker: And will not interpose the absence of any private right of action even if that were to be the conclusion of this Court.
Mr. Hunting: I am authorized to so represent.
We have made that position known in our brief.
We are not seeking to circumvent the rules of this Court as it relates to needs for cross-petition, and in particular I think the Solicitor General in the footnote on page 8 of its brief cited a number of cases that support the proposition that this Court can address that issue.
In addition, we are representing that we are not going to interpose any affirmative defense if the Court were to so rule that the CFR issue would not then be before the district court.
Unknown Speaker: Do you further represent that you cannot do it, even if you wanted to, or are you just being a good fellow?
Mr. Hunting: I believe that I could not do it, Your Honor.
Unknown Speaker: Well, but you certainly can't represent that the district judge when he looks at the case and reads our opinion that can argue... we may say there's no cause of action here... might say, well, there's nothing for me to do, then.
Isn't that a possibility?
Mr. Hunting: I would not--
Unknown Speaker: Even though you urged him otherwise, faithfully to your representation to us?
Mr. Hunting: --I think among the permutations that could arise from the unusual circumstance we have, that could be one of the permutations.
I only speak for what I'm authorized to--
Unknown Speaker: But if that happened, the petitioner would lose the benefit of a portion of his judgment.
Mr. Hunting: --In that event, if the district judge were to abstain, or to decline to take the case, or to defer it to the agency, under any one of those somewhat similar scenarios it would go to the agency, and we would then expect to abide by whatever the agency decision was on the allocation of CFR costs that are imposed under FAA rules and regulations.
Unknown Speaker: But the agency then... the agency would not be precluded by what the Sixth Circuit determined in this case, would it?
It would just be a fresh matter.
Mr. Hunting: Well, I think in a sense that all the Sixth Circuit decided was that it could not be 100 percent allocation to the commercial airlines, so I would submit to this Court that the agency would at least be bound by the narrow decision and the law of the case as it relates to this particular action, that the CFR costs could not in fact be 100-percent allocated to the commercial airlines.
Unknown Speaker: But the law of the case would be there never was a private cause of action in the first place.
That would be the law of the case.
Mr. Hunting: We recognize that, and I--
Unknown Speaker: That's the law of the other part of the case.
Mr. Hunting: --I will be candid to acknowledge that it's with some reluctance that... having prevailed at the lower court that we've raised the issue, but we raised the issue at the trial court level dealing with the private cause of action as well as exhaustion of administrative remedies and other related concepts of deference to primary jurisdiction.
Unknown Speaker: No, but you did not cross-petition on it.
Mr. Hunting: We did not cross-petition, and we are not seeking to expand relief that could be obtained by the airport or relief that would be detrimental to the airlines.
I am authorized to make that representation to the extent it's relevant to the Court's inquiry on what might happen.
I would like to address briefly the three bright line tests, as Mr. Smith has called them, of the Interstate Commerce Clause test in the Evansville case.
This airport does not retreat from any kind of analysis of the merits of its methodology and the results of its methodology.
First, the charges must reflect a fair approximation of the use of the airport facilities from which the airlines do benefit.
In very simple terms, it would appear that could mean one, two, or three things, either that the user charged must receive some benefit from the item for which the user is charged.
We certainly pass that test, and to the extent that is a subpart, we agree.
To the extent that the benefit may mean that an airport cannot goldplate its facilities... for instance, to have Vermont marble on the ticket countertops or oriental rugs on the floor, we agree that benefit can mean that.
What we would suggest that is the critical issue in this case, whether it be viewed under the Evansville standard or any other standard, is a serious warping by the airlines of what benefit means when they suggest that somehow an airport in determining its charges to one tenant must look, either by cross-credit or by change in cost allocation to the varying benefit that yet a different category of tenant might receive from its business results.
We suggest that there is no precedent of this Court in any airport or other local governmental setting that would require that a local government as owner and landlord engage in such an evaluation of benefits.
With reference to benefits, I would point out very simply that the district court found in unchallenged fashion that the totality of all airport charges, including the reduced overnight aircraft parking fee and including 100 percent of CFR, constituted only 1-1/2 percent of the gross revenues received by the airlines at this particular airport.
The second, and I think the simplest of the so-called Evansville bright line tests, are that the airport charges may not be excessive in relation to incurred costs.
In that regard, I would point out that the district court found as a specific critical finding of fact that only break-even costs as defined under the methodology and as shown under the evidence were charged to the airlines and as such I think that automatically satisfies the second charge.
And certainly I would indicate further that the Solicitor General has indicated that there is a reasonable latitude even above the incurrence and the allocation of actual costs and clearly that has been satisfied in this case.
The third criteria of Evansville is that the charge does not discriminate against interstate travel, and I would point out first that general aviation and the airlines are not in the same category of tenant under the Airport and Airway Improvement Act or under any other analysis that might be applied.
They do not, in fact, compete, and there is no evidence to show that they compete.
Unknown Speaker: Apart from that, is there a reason why the break was given to general aviation?
Mr. Hunting: --There are several reasons.
The economy of collection, which is a quotation from a portion of the Airport and Airway Improvement Act, certainly indicates that as to general aviation flights that are unscheduled it is very difficult, when they land without prior notice at an airport such as ours, to be able to apply a standard landing fee, and then to have a separate billing and to know where that billing should be sent.
And consequently this airport and, as the testimony indicates, other airports have gone to different means, which traditionally have included hangar fees, tie-down charges, and more often, also in accordance with the Airport and Airway Improvement Act, so-called fuel flowage charges on the gasoline sold by a local airport to those general aviation entities who may land there, or land there and stay there, and it is in that respect that the airport has chosen to approach the collection.
Unknown Speaker: Do I understand you to be arguing it would be too difficult to collect a landing fee from a private aircraft?
Mr. Hunting: No.
I'm saying that with the commercial airlines, at this airport and most airports, there are predicted scheduled flights.
Unknown Speaker: I understand that, but then I thought you went on to say because you don't know what the schedule is you couldn't collect a uniform fee from the general aviation--
Mr. Hunting: With general aviation, there is... these are not scheduled landings.
Unknown Speaker: --I understand that.
Mr. Hunting: So it is--
Unknown Speaker: Every time they land the tower knows--
Mr. Hunting: --The tower knows.
It has been determined by this and many airports to be more difficult to use a pure landing fee as the only mechanism by which to collect appropriate charges.
Unknown Speaker: --It's certainly not impossible.
Mr. Hunting: No, it is not impossible.
Unknown Speaker: But you're saying--
--It's done in a lot of airports.
--then it's just administrative convenience, as opposed to a decision that this category of transportation should be preferred?
Mr. Hunting: I don't believe that it's any intentional decision to prefer this particular category.
I think it is a reflection of practices that have prevailed here and elsewhere.
It is an economy of collection situation.
I think that what I think is perhaps more relevant on the general aviation issue is that they are not in the same category.
They do not compete.
The airport does not in any way financially impact the commercial airlines by virtue of this practice.
The concession revenues, which are not covered by the Anti-Head-Tax Act, are used to cover the so-called shortfall as that term has been used here.
Concession fees are not under the airport... excuse me, under the Anti-Head-Tax Act, and when you couple the finding of the district court that the airline charges did not in any way contribute to the surplus, I think that this becomes more of what the Court properly recognized as a lack of standing issue than as the airlines have characterized it.
Unknown Speaker: Mr. Smith doesn't concede that, does he--
Mr. Hunting: No, he does--
Unknown Speaker: --that the concession fees are not covered by the AHTA?
Mr. Hunting: --He does not concede that, no, and I did not mean to suggest that he did.
I would submit to the Court that the Anti-Head-Tax Act in its legislative history demonstrated no indication that concession revenues should at all be addressed by that statute.
The legislative history indicates that in fact Congress was aware that certain airports were in fact generating profits or accumulating surpluses.
I think the bottom-line analysis when looking at the statutes and the legislative history is that Congress chose to regulate the mandatory air side aspects of an airport and chose not to regulate the discretionary purchase concession side of the airports.
That's a decision that Congress has made.
Unknown Speaker: Well, I don't know how... I think it's a good argument, frankly.
I'm not sure it's all that clear.
You know, whether you're going to have something to eat while you're waiting for a plane, how discretionary is that?
Suppose the airport, you know, imposes a $20 charge on use of the restrooms in the airport?
Would that not be covered by the AHTA?
That would not be considered a charge on the persons traveling?
I think it--
Mr. Hunting: We... it could be considered a charge on the persons traveling.
We do not believe that that is covered by the Anti-Head-Tax Act.
Unknown Speaker: --Oh, really?
Mr. Hunting: It would not--
Unknown Speaker: Directly or indirectly?
Mr. Hunting: --Directly or indirectly.
Unknown Speaker: Other charge, directly or indirectly?
And you think that that's a good way around it... just really hit them for the use of the mens room.
Mr. Hunting: I... there certainly could be a mandatory aspect of the question you ask, but I do not believe that the charge for that facility is covered by the Anti-Head-Tax Act, and I would suggest, Your Honor, that perhaps the simplest analysis of whether concessions are included in section 1513(a) of the Anti-Head-Tax Act is to analyze the argument of the airlines.
They claim concessions are included in section (a), and they claim that section (b) is a so-called savings clause.
If both of those premises are true, it is clear that section 1513(b) did not save concession charges as being illegal under 1513(a), which would leave you with the absurd and I think illogical result that all concession charges at the airport would be illegal, and I suggest that that simple analysis is perhaps the easiest way to approach the very important issue here as to whether concession revenues are at all addressed by or regulated by the Anti-Head-Tax Act.
And we suggest that there is no such regulation, that Congress has simply chosen to regulate the mandatory side of airports through, initially, the Airport and Airway Improvement Act, and secondarily, the Anti-Head-Tax Act, certainly in indicating by clarifying language that these types of charges are to be permitted.
Unknown Speaker: Mr. Hunting, I'm perplexed as to why the Secretary hasn't gotten involved in this thing more.
I mean, you and the United States are proposing that we leave all this to the Secretary, but the strange phenomenon is that the Secretary's had only one case involving this legislation, and there are very major issues such as the one we're just talking about, about whether, you know, concession fees are included, and so forth.
How can it be that it's really his bailiwick and yet he hasn't done anything?
Mr. Hunting: I would suggest something that I think is outside the record, but yet I think is certainly known, and that is that in many instances with other airports there have been leases that could be of duration, 10, 20, or 30 years, so that these charges have been established in one form or another by negotiated leases that cover long periods of time.
Consequently, much of the period of time that would have been taken care of in the seventies and eighties were, I think, at many airports covered by leases of very long duration, and I think that to that extent the issue is now percolating I think to a greater extent than it has before.
But I would suggest to the Court that in the very complex situation of the Massport case that the agency in fact did choose to entertain a complaint by a general aviation entity, chose to intervene in the other proceedings, and continued with an active role throughout all of that, and it was in fact the Massport proceeding that caused this airport to raise the affirmative defenses when it did in late December of '89 and early January of 1990.
And if I could address I think several questions that came from the Court, the dismissal by district court Judge Bell of the interstate commerce case was not solely on issues of law.
I hesitate to be before this Court and talking about answers to interrogatories and discovery, but the airport filed a combined motion under Rule 56 for summary judgment and 12(b)(6), and for the combined reasons of no factual proofs either to support an interstate commerce claim or, perhaps more importantly, to distinguish that claim from an Airport and Airway Improvement Act claim, or an Anti-Head-Tax Act claim, relying on that absence of factual proof and the rationale of the Merrion case, the district court so ruled.
And I would point out to the Court that the Sixth Circuit observed the nature of that ruling on pages 30 and 31 of its opinion, commenting that there was a factual aspect and lack of proof as well as to legal, and we stand here today, even without the absence of proof that in my judgment would indicate any violation of the Interstate Commerce Clause.
Unknown Speaker: Are you then taking issue with Mr. Smith, who said because it was cut off so early in the district court they didn't have a chance to show that general aviation coincides with intrastate traffic?
Mr. Hunting: I am.
Those records exist in the FAA tower independent of discovery directed to the airport.
The ruling by district court Judge Bell was in an opinion in the middle of January 1990.
We went to trial February 12, 1990.
That opinion was on the eve of trial, after considerable opportunity to adduce facts that would distinguish and/or support an Interstate Commerce Clause claim, so I'm suggesting that there were two prongs, or two aspects of the ruling of the district court as affirmed by the Sixth Circuit, and the Sixth Circuit noted the contentions of the airport on page 30 and 31 of its opinion in that regard.
Unknown Speaker: Is it your position that the airlines can't be in a deficiency position coming to court, that they have to pay and complain later, is that... it's only a refund that they can get.
Suppose they're sued in a State or Federal court?
They have to pay up, and then they can seek a refund?
Mr. Hunting: If I could explain to you specifically what we have done in our instance, I would hope that would answer you.
We reached a stipulation with the airlines, filed in this case at the district court level, that would make the payments from them to this airport subject to whatever the final results of this decision is.
We have a judgment supported by bonds for the difference between the old rates and the new rates from April 1, 1988 to the end of 1989, which was the end of the period of time covered.
In addition, we have a stipulation that would make the results of any CFR allocation, and/or any decision of this Court would be taken into account quantitatively by virtue of that stipulation.
Unknown Speaker: I mean for the future.
Your position is that there is no lawsuit that the airlines can institute.
They must either be in a defensive posture, resisting a suit for them to pay, or they can go to the FAA, or they can go to the Department of Transportation, but they can't... they can't come to court as a plaintiff.
Mr. Hunting: We are saying that the resort in the first instance for the airlines, if they are to challenge reasonableness, is to go to the agency.
The second question which I think you were positing to me is, as a practical matter, what position would be airport take about the interim usage of the airport during the period of time that a reasonableness dispute might be existing, I would hope that we would, if such a situation again arose, reach another amicable stipulation as we did at the trial court level.
Unknown Speaker: Thank you, Mr. Hunting.
Mr. Hunting: Thank you very much.
Unknown Speaker: Mr. Smith, you have 2 minutes remaining.
Rebuttal of Walter A. Smith, Jr.
Mr. Smith: Thank you, Your Honor.
First of all, at page 46-A of the appendix to the cert petition is where the district court quite clearly dismissed our Commerce Clause claim solely on the ground that Congress had taken action in the area.
Second, with regard to Justice Scalia's question about whether or not concessions are covered by the AHTA, we take the view that whether or not they are covered, whereas here the concession fees are being paid ultimately by the passengers, the right reasoning is the one that Judge Posner used in Indianapolis, and that is to say that whereas here the total fees being imposed on the airlines and their passengers through this fee methodology vastly exceed the airport's costs, that is precisely what Congress intended to prohibit in the AHTA.
And finally, let me address Mr. DuMont's point that we are relying only on the word 1513 on the merits of the private right of action issue.
That is not true at all, as we explained in our brief, but most importantly, whereas here Congress was intending to strengthen the prohibitions of Evansville, a case in which a right of action by the airlines had been recognized, it would be perverse to suppose that Congress was there by sub silentio taking away the most effective way of carrying out the indications in the AHTA of what the Congress wanted to achieve, and that, to us, is grounds enough alone to find we ought to win the private right of action issue even if the Court reaches it.
Finally, I would mention that even if Mr. Hunting is kind enough to give away the CFR issue, if this Court reaches the private right of action issue, it will have to modify the judgment below, and under this Court's precedents the Court is not permitted to do that, whereas here, Mr. Hunting elected not to file a cross-petition.
Chief Justice Rehnquist: Thank you, Mr. Smith.
The case is submitted.
Unknown Speaker: The honorable court is now adjurned until tomorrow at ten o'clock.
Argument of Speaker
Mr. Speaker: I have the opinions of the Court in four cases to announce.
The first is No. 92-97, Northwest Airlines versus the County of Kent, Michigan.
This case involves a challenge to user fees charged by the Kent County that is Grand Rapids, Michigan Airport to commercial airlines.
The airlines contend that the fees are unreasonable and discriminatory under a Federal statute called the Anti-Head Tax Act and the Commerce Clause of the Constitution.
They say that the airport should have allocated airfield cost to the concessions at the airport as well as to the flight operations and that the airport's failure to charge the general aviation a hundred percent of its allocated cost was wrong.
The Court of Appeals for the Sixth Circuit held that the airlines were entitled to bring a private action under the Act but rejected the airlines challenge to the fees in principal part.
We assumed for the purposes that this case that the Act permits the airlines to commence this civil action and we affirm the judgment of the Court of Appeals.
In the absence of guidance from the Secretary of Transportation with ministers of the Federal aviation laws, we apply reasonable standards used in prior cases.
Under these standards and in an opinion authored by Justice Ginsburg, we conclude that the fees should be left undisturbed.
Justice Thomas has filed a dissenting opinion.