Legend Terminal Owners May Still Appeal, Pursue Claim
A US District Court
Judge on Wednesday threw out a lawsuit against last year's
compromise on the Wright Amendment, ruling the city of Dallas did
not violate any laws when it tore down the former Legend terminal
at city-owned Dallas Love Field.
Judge Sidney Fitzwater ruled against Love Terminal Partners LP
and Virginia Aerospace LLC, owners of the six-gate terminal built
for now-defunct Legend Airlines. Both parties argued the city
illegally bulldozed the terminal earlier this year, as a condition
of the 2006 Wright agreement limiting Love Field to a maximum of 20
gates.
The partners had hoped to lure Pinnacle Airlines to use the
terminal. They argued the parties involved in the Wright compromise
-- the cities of Dallas and Fort Worth, American Airlines and
Southwest Airlines, and the DFW International Airport Board --
violated federal anti-trust laws when they agreed to limit
competition at Love in June 2006.
"We're disappointed in the analysis," Bill Brewer, attorney for
the plaintiffs, told the Dallas Morning News. "But he's a fine
judge. He obviously worked hard on the opinion. We'll consider
whether or not we'll appeal. The upshot of the opinion was that
this was a federal taking of our property."
The parties are still reportedly considering the pursuit of a
claim in the Federal Court of Claims, seeking to recoup the
estimated $100 million value of a contract Pinnacle offered for
leasehold rights in 2006, before news broke of the compromise
agreement.
As ANN reported, the
compromise on the Wright Amendment -- which limited flights from
Love Field to neighboring states, ostensibly to reduce competition
to Dallas/Fort Worth International Airport -- was signed into law
by President Bush last October. It calls for the repeal of Wright
in 2014; until then, airlines flying from DAL may "through-ticket"
to other destinations.
"The city of Dallas is
delighted with Judge Fitzwater's decision," said Robert C. Walters,
an attorney at the law firm Vinson & Elkins, which represented
the city. "Judge Fitzwater has properly interpreted and enforced
the will of Congress when it enacted the Wright Amendment Reform
Act. This is an important victory for North Texas air
travelers."
Fitzwater noted the compromise may indeed restrict competition
in the short term, but Congress already approved the plan.
"Considered together, it is clear that Congress intends as the
default rule that anticompetitive conduct be broadly prohibited by
law," Fitzwater wrote in his opinion. "But in the case of airline
competition in the North Texas region, Congress is willing to
tolerate and sanction some anticompetitive behavior as a means of
effecting the eventual end to the Wright Amendment restrictions
that hamstring domestic flights to and from Love Field."
So far, the compromise has worked to greatly increased traffic
at Love. The DMN notes traffic for September 2007 was up at Love by
16 percent -- including a 22 percent increase for Southwest -- over
the same period in September.
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