Leases, indecision and the Bible: What we learned at Monday's Love Field gate hearing

Leases, indecision and the Bible: What we learned at Monday's Love Field gate hearing

Author: Conor Shine, The Dallas Morning News

Lawyers for Southwest and Delta airlines were peppered with questions Monday by a panel of three federal judges in Houston in the ongoing dispute over who has the right to use the limited airport gate space at Dallas Love Field.

The hearing didn't result in an immediate ruling, but Southwest did walk away with some positive momentum after losing the last round of the legal battle in January. That's when a federal district court judge sided with Delta in allowing the Atlanta-based airline to continue operating out of the city-owned airport while the case is litigated.

Southwest appealed that January ruling to the Fifth Circuit Court of Appeals, arguing that Delta does not have standing to sue for access at Love Field because it's not party to any of the gate leases signed after the 2006 Wright Amendment Reform Act that lifted restrictions on flights out of the airport.

On Monday, Fifth Circuit Court Judge Edith Jones seemed to support Southwest's argument, saying that to view Delta as a so-called third party beneficiary to the leases with standing to sue would be a "travesty" under contract case law.

Delta didn't come up totally empty handed. Another judge, Eugene Davis, suggested the city's support of the January injunction can be viewed as backing Delta's right to operate out of Love Field. But in its filings so far, the city has tried to remain neutral in the case, to the point one judge compared the city to the biblical figure Pontius Pilate.

Which of these arguments will win out won't be known until the court issues its ruling. For now, the case remains as muddled as ever, with the answer lying somewhere in the tangle of federal laws, regulations and guidelines and the airport lease documents that govern access at Love Field.

Here's how other key issues played out at Monday's hearing:

Delta's right to sue 

One of Southwest's key arguments so far has been that Delta can't sue for access at Love Field because it is not an original party to the leases, which granted preferential rights to 16 gates to Southwest, another two gates to American Airlines and two more to ExpressJet, which is now part of United Airlines.

Delta instead has been operating its five daily flights out of Love Field since 2009 under sublease and temporary space agreements with the various leaseholders. When Southwest acquired rights to the two gates previously held by United in 2014, it signaled it wanted to make full use of them, meaning Delta would be pushed out.

In response, Delta called for the city of Dallas, the airport's owner, to force Southwest to share the gates.

Instead, the city preemptively initiated the lawsuit seeking guidance on how to resolve the issue, leading to the January ruling by District Court Judge Kinkeade that found Delta could sue for access and the right to remain at Love Field until the case is resolved.

Although the lease agreements do outline a process for new airlines to apply for space at Love Field, Southwest and the city have argued that the city is required only to consider the application, not necessarily approve it.

On Monday, Judge Jones said requiring the city to grant space to any applicant, whether it's Delta or another airline, could open the door for competitors to "nibble away at Southwest's gates bit by bit."

But Delta has argued its situation is unique because Southwest wasn't making full use of its gates when Delta requested the space.

Southwest was in the process of ramping up its operations at the time following the lifting of Wright Amendment restrictions, but the Department of Transportation indicated in a letter to the city that all that matters is the space available at the time Delta made its request.

The DOT's problem?

The Department of Transportation has authored two advisory letters to the city offering guidance on the case, and although the letters didn't call for it explicitly, they seem to support allowing Delta to continue operating at Love Field. However, the letters are not official rulings, and the city has described them as "confusing, conflicting and unsupported directions."

One of Delta's key arguments is that the city, which receives federal funds for Love Field, is federally obligated to provide access.

The federal government's involvement led Judge Jones to question why the issue was being dealt with through the court system rather than through an administrative proceeding involving the Federal Aviation Administration and Department of Transportation.

The FAA has opened an investigation into the city's handling of the matter, but so far there have been no findings released publicly.

Whether the dispute should be dealt with through the courts or through federal agencies wasn't resolved Monday, but it could pop back up when the court issues its ruling.

Delta and the status quo

Monday's hearing dealt largely with whether Delta can continue operating out of Love Field while the case goes through a trial and then likely appeals.

Delta's lawyer Russell Falconer said the company is interested in preserving the status quo and that if it's forced out of Love Field before the trial is resolved, it would be difficult for the company to regain that access even if it's ultimately successful.

Falconer pointed to testimony by a Southwest executive who said the company's 180 daily flights out of Love Field are all the flights it currently wants to operate out of the airport as proof that Delta's continued presence isn't impeding Southwest's operations.

Southwest's attorney Eric Pinker countered that while Southwest fully uses its gates, removing Delta would open up the possibility of squeezing even more flights out of them.

Dallas and the bible

When Delta requested space at Love Field, the city was faced with a choice: force Southwest to share or kick Delta out. Either was likely to lead to a lawsuit, so instead the city sued first, seeking federal guidance on how it should decide the issue.

Although the city agreed with the January injunction allowing Delta to continue operating, the city has repeatedly insisted it has no interest in which side ultimately prevails. The city says it's interested in avoiding "potential chaos and uncertainty" over the gate dispute.

"The city's focus was on obtaining certainty and finality rather than arguing that the preliminary or final relief should favor Southwest or Delta," city attorneys wrote in a June filing.

Southwest's attorneys have argued that it shouldn't have to share gate space with Delta until ordered to by the city, something that hasn't happened yet.

The city's refusal to decide the issue and instead turn to the courts as a way to avoid responsibility and potential legal damages led Judge Jones to compare the situation to that of Pontius Pilate, who relied on the demands of the crowd in deciding to crucify Jesus Christ.

"I don't doubt pressure was coming from both sides," Jones said of the city's situation.

The city wasn't alone though, with Jones later adding DOT and FAA to that characterization for their indecision.

"There's Pontius Pilates all over the place," she said.