In re Transpacific Passenger Air Transportation Antitrust Litig.

• Decision Date: 23 September 2014
• Docket Number: No. C 07–05634 CRB,C 07–05634 CRB
• Citation: 69 F.Supp.3d 940
• Parties: In re Transpacific Passenger Air Transportation Antitrust Litigation. This Document Relates to: All Actions.
• Court: U.S. District Court — Northern District of California

69 F.Supp.3d 940

In re Transpacific Passenger Air Transportation Antitrust Litigation.

This Document Relates to: All Actions.

No. C 07–05634 CRB

United States District Court, N.D. California.

Signed September 23, 2014

Eric James Buescher, Joseph W. Cotchett, Niall Padraic McCarthy, Adam John Zapala, Aron K. Liang, Douglas Yongwoon Park, Nanci Eiko Nishimura, Neil Swartzberg, Steven Noel Williams, Matthew Kendall Edling, Cotchett Pitre and McCarthy, LLP, Burlingame, CA, Niki B. Okcu, AT & T Services, Inc. Legal Dept., Aaron M. Sheanin, Pearson, Simon & Warshaw, LLP, Christopher L. Lebsock, Michael Paul Lehmann, Hausfeld LLP, Derek G. Howard, Jack Wing Lee, Minami Tamaki LLP, Craig C. Corbitt, Heather T. Rankie, Jiangxiao Athena Hou, Patrick Bradford Clayton, Zelle Hofmann Voelbel & Mason LLP, Jennie Lee Anderson, Andrus Anderson LLP, Mario Nunzio Alioto, Lauren Clare Capurro, Trump Alioto Trump & Prescott LLP, Joseph Mario Patane, Law Office of Joseph M. Patane, Allan Steyer, Dana Marie Andreoli, Jayne Ann Peeters, Michelle Akerman, Steyer Lowenthal Boodrookas Alvarez & Smith LLP, Kimberly Ann Kralowec, The Kralowec Law Group, Guido Saveri, Cadio R. Zirpoli, Richard Alexander Saveri, William John Heye, Saveri & Saveri, Inc., Christina H. Sharp, Daniel C. Girard, Girard Gibbs LLP, Laurence D. King, Kaplan Fox & Kilsheimer LLP, Terry Gross, Gross Belsky Alonso LLP, Susan Gilah Kupfer, Glancy Binkow & Goldberg LLP, Christopher T. Heffelfinger, Berman Devalerio, Bruce Lee Simon, Thomas Kay Boardman, Ashlei Melissa Vargas, Pearson Simon & Warshaw, LLP, San Francisco, CA, Elizabeth Lane Crooke, Richard Pollard Kinnan, Walter John Lack, Engstrom, Lipscomb & Lack, Jeff S. Westerman, Westerman Law Corp, Phillip Alden Baker, Baker, Keener & Nahra, Marc M. Seltzer, Susman Godfrey LLP, Graham Bruce Lippsmith, Amanda Heather Kent, Neyleen Sara Beljajev, Girardi & Keese, Brian Joseph Barry, Law Offices of Brian Barry, Gregory Jonathon Mann, Pierce Henry O'Donnell, Robert M. Partain, O'Donnell & Associates P.C., Los Angeles, CA, Reginald Von Terrell, The Terrell Law Group, Sharron Williams Gelobter, Yurumein Law Firm, Oakland, CA, Sherman Kassof, Law Offices of Sherman Kassof, Lafayette, CA, Jay L. Himes, Labaton Sucharow LLP, Brian P. Murray, Lee Albert, Glancy Binkow & Goldberg LLP, Peter G.A. Safirstein, Morgan & Morgan, Elana Katcher, Robert N. Kaplan, Kaplan Fox Kilsheimer, Lawrence D. McCabe, Murray Frank & Sailer LLP, New York, NY, Seth R. Gassman, Michael D. Hausfeld, Swathi Bojedla, Hausfeld LLP, Daniel Cohen, Cuneo Gilbert & Laduca, LLP, Washington, DC, Robert G. Eisler, Grant & Eisenhofer P.A., Wilmington, DE, Steven A. Kanner, William Henry London, Freed Kanner London & Millen LLC, Bannockburn, IL, Janice Seyoung Yi, Law Offices of Ronald B. Bass, Walnut Creek, CA, Daniel J. Walker, Susman Godfrey L.L.P., Seattle, WA, B.J. Wade, Glassman Edwards Wade & Wyatt, P.C., Memphis, TN, John G. Emerson, Emerson Poynter LLP, Houston, TX, Scott E. Poynter, Emerson Poynter LLP, Little Rock, AR, Eugene A. Spector, Spector Roseman Kodroff & Willis, PC, Dianne M. Nast, Nastlaw LLC, Philadelphia, PA, Garrett D. Blanchfield, Jr., Reinhardt Wendorf & Blanchfield, St. Paul, MN, Daniel E. Gustafson, Gustafson Gluek PLLC, W. Joseph Bruckner, Lockridge Grindal Nauen P.L.L.P., Minneapolis, MN, Joseph Goldberg, Freedman Boyd Hollander Goldberg & Ives, P.A., Albuquerque, NM, Richard J. Arsenault, Neblett, Beard & Arsenault, Alexandria, LA, for Plaintiffs.

Michael J. Holland, Condon and Forsyth LLP, Alysia Solow, Ankur Kapoor, Aymeric F. Dumas–Eymard, Gary J. Malone, Constantine Cannon LLP, Rowan D. Wilson, Gina M. Magel, Kavita B. Ramakrishnan, Leslie A. O'Brien, Sara A. Slavin, Cravath, Swaine & Moore LLP, Brenda Diluigi, James Robert Warnot, Jr., Thomas A. McGrath, Linklaters LLP, Douglas H. Flaum, Shahzeb Lari, Paul Hastings LLP, Joshua Daniel Roth, Fried, Frank, Harris, Shriver and Jacobson LLP, New York, NY, Roderick David Margo, Scott David Cunningham, Condon & Forsyth, Elizabeth Minjue Kim, Jason Yuegin Kelly, Jonathan Jeffrey Faria, Tammy Ann Tsoumas, Kirkland & Ellis LLP, David Andrew Senior, Ann–Kathryn Rose Tria, Matthew Weston, McBreen & Senior, Los Angeles, CA, Douglas E. Rosenthal, Constantine Cannon LLP, David H. Bamberger, Deana Louise Cairo, Fayek Martin Dajani, DLA Piper LLP, James V. Dick, Squire, Sanders & Dempsey, LLP, William Karas, Kenneth P. Ewing, Steptoe & Johnson LLP, William R. Sherman, Charles R. Price, Jason D. Cruise, Latham & Watkins LLP, Mitchell D. Raup, Mayer Brown LLP, Alice G. Glass, Ishai Zvi Mooreville, Kimberly N. Shaw, W. Todd Miller, Baker & Miller PLLC, Gary A. MacDonald, Skadden, Arps, Slate, Meagher & Flom LLP, Michael J. Fanelli, Covington & Burling LLP, Bernard Angelo Nigro, Jr., Fried, Frank, Harris, Shriver and Jacobson LLP, Washington, DC, Joseph Anthony Meckes, Squire Patton Boggs (US) LLP, Ashley Marie Bauer, Rahul Kaustubh Kolhatkar, Latham & Watkins LLP, Jesse William Markham, Michael Bertram McNaughton, Hanson Bridgett LLP, Anita Fern Stork, Esq., Cortlin Hall Lannin, Covington & Burling LLP, Benjamin Todd Diggs, Megan Dixon, Hogan Lovells US LLP, San Francisco, CA, Danielle Suzanne Fitzpatrick, DLA Piper US LLP, Seattle, WA, Andrew P. Young, Kirkland & Ellis LLP, James Mutchnik, Chicago, IL, Pantea Yashar, Ervin Cohen Jessup LLP, Beverly Hills, CA, Mark S. Priver, Ohashi & Priver, Pasadena, CA, Jung–Ying Joann Liao, Edward D. Johnson, Mayer Brown LLP, J. Christopher Mitchell, Hogan Lovells US LLP, Palo Alto, CA, Robert B. Hawk, Hogan Lovells US LLP, Menlo Park, CA, for Defendants.

MEMORANDUM AND ORDER GRANTING IN PART AND DENYING IN PART MOTIONS FOR SUMMARY JUDGMENT

CHARLES R. BREYER, UNITED STATES DISTRICT JUDGE

The five remaining Defendants in this antitrust suit—Air New Zealand, All Nippon Airways (“ANA”), China Airlines, EVA Air, and Philippine Airlines—move for summary judgment on the basis of the filed rate doctrine, a defense to private antitrust suits, which provides that “to the extent Congress has given [an agency] authority to set rates ... and [the agency] has exercised that authority, such rates are just and reasonable as a matter of law and cannot be collaterally challenged under federal antitrust law....” See E. & J. Gallo Winery v. EnCana Corp., 503 F.3d 1027, 1035 (2007). As explained below, the Court finds that Congress gave the Department of Transportation (“DOT”) authority over all of the rates and charges at issue in this case, and that (1) the DOT exercised that authority over the rates that Defendants actually filed with the DOT (Class B and C air fares), but (2) the DOT did not exercise that authority over the rates that Defendants did not file with the DOT (Class A air fares, fuel surcharges, and ANA special discount rates). The filed rate doctrine therefore applies, and bars treble damages, only as to the filed rates in this case.¹

I. BACKGROUND

Defendants are various airlines alleged to have agreed to fix, raise, maintain, and/or stabilize air passenger travel, including associated surcharges, for international flights between the United States and Asia/Oceania, in violation of section 1 of the Sherman Antitrust Act, 15 U.S.C. § 1. Plfs.' 2d Consolidated Amended Compl. (“Second CAC”) (dkt. 741) ¶¶ 1–2. Plaintiffs are a class of individuals who purchased from one or more of the Defendants air transportation services that included at least one flight segment between the United States and Asia/Oceania. Id. ¶¶ 8–23. The Second CAC alleges that, beginning no later than January 1, 2000, Defendants and their co-conspirators agreed and began to impose air fare increases, including fuel surcharge increases, that were in substantial lockstep both in their timing and their amount. See id. ¶ 74.

A. Procedural History

In May 2011, the Court granted in part and denied in part Defendants' motions to dismiss, reserving for summary judgment the question of whether the filed rate doctrine bars Plaintiffs' claims. Order Re Mot. to Dismiss (dkt. 467) at 13–14. At the time, the Court found that several factual matters were still unresolved, including which rates were actually filed with the DOT, and whether the DOT believed that the air fares and surcharges were covered by the filed rate doctrine. Id. at 14; see also Opp'n (dkt. 885) at 4 (citing Tr. of Nov. 1, 2010 (dkt. 448) at 45).

Now before the Court are five individual motions for summary judgment, based solely on the filed rate doctrine.² See ANA Mot. (dkt. 724), China Airlines Mot. (dkt. 731), Air New Zealand Mot. (dkt. 753), Philippine Airlines Mot. (dkt. 763), EVA Mot. (dkt. 792). Each individual motion lays out the regulatory facts specific to that Defendant. All of the Defendants but ANA have also filed a Joint Memorandum, arguing that the filed rate doctrine bars all of Plaintiffs' claims for damages. See Joint Memo. (dkt. 728).

The motions present an issue of first impression. The Court must determine whether and how the filed rate doctrine, which has traditionally applied to utilities such as telecommunications and gas and power companies, applies to a “deregulated” international airline industry.³ Because the filed rate doctrine is a preemption doctrine that requires the Court to defer to congressional intent and agency expertise, the Court must examine whether Congress intended for the filed rate doctrine to apply to air fares and surcharges, and whether the DOT actually authorized the rates and surcharges at issue here.⁴

B. Legislative and Regulatory Background

In 1958, Congress enacted the Federal Aviation Act (“FAA”) to require every airline to establish and maintain “reasonable prices, classifications, rules, and practices related to foreign air transportation.” 49 U.S.C. § 41501. By definition, the word “price” includes any “fare or charge” for air transportation.See 49 U.S.C. § 40102(a)(39). The FAA tasked the DOT's predecessor agency, the CAB,⁵ with “preventing unfair, deceptive, predatory or anticompetitive...