Undemocratic secrecy shrouds airline alliance antitrust immunity hearings

The STAR and oneworld airline alliances have filed antitrust immunity requests with the Department of Transportation (DOT) that are far more far-reaching than any such immunity in the past. In my opinion and in the judgment of many others, this immunity is not in the interest of America’s traveling public nor the nation’s travel industry at large.

Essentially, this expanded antitrust immunity will provide the negotiating benefits of a giant merger, eliminating much of the competition from the airline industry. More than 40 separate airlines will be able to negotiate as three giant alliances with travelers, corporations, suppliers and travel agents, if the the airline alliances get their way.

In a rush to fast-track these antitrust immunity proceedings for a possible regulatory approval prior to the change of administration in Washington, the DOT is colluding with the the airlines by allowing them to keep much of the pleadings and documentation secret.

These DOT rules do not allow journalists access to the redacted materials. Only lawyers who sign confidentiality agreements are allowed to see glimpses of the airlines’ true intentions.

If this kind of near-merger alliance would benefit consumers as much as the airlines claim, they would be taking out full-page advertisements in newspapers proclaiming how consumer-friendly the immunity will allow them to be. Unfortunately, the airlines and the DOT have decided cloak much of their deliberation in secrecy.

Yesterday, I filed this official comment with regulations.gov directed to the DOT about the current dockets regarding antitrust immunity for both the STAR and oneworld airline alliances (DOT-OST-2008-0252 and DOT-OST-2008-0234).

I hope that DOT decides to open these antitrust immunity hearings to the public rather than continuing their operations behind closed doors. DOT’s ultimate responsibility is to the public not the airline industry who they are charged to regulate.

December 15, 2008

TO: Secretary of Transportation
FROM: Charles Leocha
RE: DOT-OST-2008-0252 and DOT-OST-2008-0234

I am a journalist working with Tripso.com, a consumer travel commentary news site. I also have a correspondent relationship with MSNBC.com. I am in the midst of reporting on the antitrust immunity applications currently under consideration for the oneworld and STAR alliances.

The overwhelmingly redacted public dockets are almost completely frustrating my ability to report accurately on newsworthy developments in these important proceedings. I seriously question whether DOT has struck the appropriate balance between airline confidentiality and the public’s legitimate right to know. I urge you to re-evaluate your procedures and declassify much of what is currently, and likely erroneously, protected.

In the current round of antitrust immunity applications, the public interest is supposed to guide the department’s decision making. As such, there should be an on the record debate about the airlines’ plans and a full and open discussion of the purported costs and benefits for the traveling public. In depth media coverage would clearly be in the public interest here. If these antitrust immunity applications were granted, many commentators believe they would change the competitive landscape in the industry and would dramatically impact consumers — both business and leisure travelers — in the future. However, these consumers and their media sources are being all but shut out of these proceedings.

I am deeply disturbed by the filings of the STAR and oneworld alliances regarding their proposed antitrust immunity plans. It seems unconscionable for the members of these alliances in some cases to redact three-fourths or more of their applications and answers. For example, in the oneworld joint applicants’ December 3, 2008 public answer to ASTA and ITSA’s motion to require additional documents and data, fully four pages of the six page filing are redacted. Other commentators have in turn redacted their filings so as not to compromise what their lawyers (who have private access to the information granted by DOT) have learned.

The result is dockets that shed less light than darkness on the proceedings. Rumors are spreading that immunized airlines plan to use their DOT-granted authority to negotiate jointly with travel agents, corporations and suppliers on matters concerning content, compensation and services. These are huge issues that I would like to explore for my readers, but I only have a small part of the full story.

This kind of blanket secrecy is not in keeping with an open society and a democratic government. I can understand and accept redacting specific figures or truly proprietary corporate information; however simply making their responses secret and unavailable to the public, as well as journalists and other experts reporting on and writing about these proceedings, is patently unacceptable.

I hope that the Department of Transportation will not allow this untenable situation to remain in place. After all, these are public proceedings and DOT is charged with working in the public interest, not only in the airlines’ narrow commercial and competitive interests.

I hereby make a formal request for a thorough reevaluation of all information identified as “confidential” in dockets DOT-OST-2008-0252 and DOT-OST-2008-0234 and a declassification of all material that does not merit such treatment. I am an interested party, but I am not a lawyer and I do not have resources available to hire one. Instead, I am a journalist reporting in the interest of airline consumers, travel industry professionals and airline suppliers. These citizens will be directly and deeply affected by potential grants of antitrust immunity and they have a right to know what is actually happening in these proceedings and not to be left reading between heavily redacted lines.

I look forward to your response and to having more complete access to any and all unreasonably classified documents in these two matters. As these dockets stand now, they make a travesty of the important work of DOT.

Sincerely,

Charles Leocha
Tripso.com/MSNBC.com

Go directly to regulations.gov to add your comments to these two dockets. The filings and comments provide an indepth look at the work of DOT, however, they also show broadbrush applications of redacted pages and secrecy on the part of the airlines involved.

Docket DOT-OST-2008-0252 concerns antitrust immunity for the oneworld airline alliance and document DOT-OST-2008-0252-1586.1 is the prime example of blanket airline secrecy.

Docket DOT-OST-2008-0234 deals with the STAR Alliance antitrust immunity request. Document DOT-OST-2008-0234-0003 provides the alliances case for secrecy.