Northern Air Cargo v. United States Postal Service ( 2011 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
)
NORTHERN AIR CARGO, et al., )
)
Plaintiffs, )
)
v. )
)
UNITED STATES POSTAL SERVICE, ) Civil Action No. 10-2076 (EGS)
)
Defendant, )
)
and )
)
PENINSULA AIRWAYS, INC., )
)
Defendant-Intervenor. )
)
MEMORANDUM OPINION
On December 3, 2010, the United States Postal Service (the
“Postal Service”) granted an equitable tender of nonpriority
mainline bypass mail to Peninsula Airways, Inc. (“PenAir”) on
five mainline routes in rural Alaska pursuant to 39 U.S.C.
§ 5402(g)(5)(c) (“§ 5402(g)(5)(C)”). This equitable tender is
now being challenged by three mainline carriers – Northern Air
Cargo (“NAC”), Tatonduk Outfitters Ltd d/b/a Everts Air Cargo
(“Everts”), and Lynden Air Cargo LLC (“Lynden”) (collectively,
“plaintiffs”). Specifically, plaintiffs challenge the Postal
Service’s purportedly ultra vires determination that PenAir had
satisfied the “Prior Service and Capacity Requirement” of 39
U.S.C. § 5402(g)(1)(A)(iv)(II) (“§ 5402(g)(1)(A)(iv)(II)”) as of
December 3, 2010.1 Plaintiffs seek both declaratory and
injunctive relief. See generally Compl.
Pending before the Court is plaintiffs’ motion for summary
judgment, as well as the cross-motions for summary judgment filed
by Defendant Postal Service and Defendant-Intervenor PenAir
(collectively, “defendants”). Upon consideration of the motions,
the responses and replies thereto, the applicable law, the entire
record, and for the following reasons, the Court hereby DENIES
plaintiffs’ motion for summary judgment and GRANTS defendants’
cross-motions for summary judgment.
I. BACKGROUND
This is the second action that plaintiffs have filed with
respect to the Postal Service’s purportedly unlawful tender of
nonpriority mainline bypass mail to PenAir in five rural Alaskan
communities.2 The first action, (hereinafter, the “2009
1
As discussed below, the Prior Service and Capacity
Requirement requires the Postal Service “in selecting carriers of
nonpriority bypass mail . . . [to] adhere to an equitable tender
policy . . . and [to], at a minimum, require that any such
carrier– . . . (iv) have provided scheduled service . . . between
2 points within the State of Alaska for at least 12 consecutive
months with aircraft– . . . (II) over 7,500 pounds payload
capacity before being selected as a carrier of nonpriority bypass
mail at the intra-Alaska mainline service mail rate.” 39 U.S.C.
§ 5402(g)(1)(A)(iv)(II).
2
Readers are referred to the Memorandum Opinion issued
in Northern Air Cargo v. United States Postal Service, 741 F.
Supp. 2d 41 (D.D.C. 2010), for additional background information.
In addition, a lengthy discussion of the Intra-Alaska Bypass Mail
System and the Rural Service Improvement Act of 2002 (the “RSIA”)
is also provided in that Memorandum Opinion. See id. at 43-45.
2
Action”), challenged the Postal Service’s August 2009 and
September 2009 determinations that PenAir was eligible for the
equitable tender of nonpriority mainline bypass mail on five
mainline routes: Anchorage-Dillingham, Anchorage-King Salmon,
Anchorage-Aniak, Anchorage-McGrath, and Anchorage-Unalakleet.
See Northern Air Cargo v. United States Postal Serv., 741 F.
Supp. 2d 41 (D.D.C. 2010) (hereinafter, Northern Air Cargo I);
see also Pls.’ SMF ¶ 33. On September 23, 2010, this Court
issued an opinion granting in part and denying in part the
parties’ cross-motions for summary judgment. Northern Air Cargo
I, 741 F. Supp. 2d 41. The Court held, among other things, that
the Postal Service had exceeded its statutory authority in
determining that PenAir was not required to satisfy the Prior
Service and Capacity Requirement of § 5402(g)(1)(A)(iv)(II) in
As discussed therein, “[i]n passing the RSIA, Congress affirmed
that ‘[a]s long as the Federal Government continues to own large
tracts of land within the State of Alaska which impede access to
isolated communities, it is in the best interest of the Postal
Service, the residents of Alaska and the United States’ to:
(i) ‘ensure that the Intra-Alaska Bypass Mail system remains
strong, viable, and affordable for the Postal Service’;
(ii) ‘ensure that residents of rural and isolated communities in
Alaska continue to have affordable, reliable, and safe passenger
service’; (iii) ‘ensure that residents of rural and isolated
communities in Alaska continue to have affordable, reliable, and
safe nonmail freight service’; (iv) ‘encourage that intra-Alaska
air carriers move toward safer, more secure, and more reliable
air transportation . . . where such operations are supported by
the needs of the community’; and (v) ‘ensure that the
Intra-Alaska Bypass Mail system continues to be used to support
substantial passenger and nonmail freight service and to reduce
costs for the Postal Service.’” Id. at 44 (quoting Congressional
Findings, Pub. L. 107-206 § 3002(b)(12)).
3
order to be tendered nonpriority mainline bypass mail pursuant to
§ 5402(g)(5)(C). Id. at 52-53. The Court therefore enjoined the
Postal Service from tendering nonpriority mainline bypass mail to
PenAir until the airline satisfied the Prior Service and Capacity
Requirement of the RSIA. See Civil Action No. 09-2065, Order
dated Sept. 23, 2010 at 2.3 Accordingly, on September 24, 2010,
the Postal Service ceased tendering nonpriority mainline bypass
mail to PenAir. Pls.’ SMF ¶ 36.
On October 12, 2010, PenAir submitted a request to the
Postal Service under § 5402(g)(5)(C) to receive an equitable
tender of nonpriority mainline bypass mail in the same five rural
Alaskan markets that it had previously carried nonpriority
mainline bypass mail: Dillingham, King Salmon, Aniak, McGrath,
and Unalakleet. Pls.’ SMF ¶ 37. By letter dated October 21,
2010, the Postal Service informed PenAir that it believed PenAir
had satisfied the Prior Service and Capacity Requirement of
3
The Court’s September 23, 2010 Order states, in
relevant part: “In accordance with the Memorandum Opinion issued
on this same day, it is hereby . . . FURTHER ORDERED and DECLARED
that Defendant United States Postal Service (the ‘Postal
Service’) exceeded its statutory authority in determining that
Peninsula Airways, Inc. (‘PenAir’) was not required to satisfy
the Prior Service and Capacity Requirement of 39 U.S.C. §
5402(g)(1)(A)(iv)(II) in order to be tendered nonpriority
mainline bypass mail pursuant to 39 U.S.C. § 5402(g)(5)(C); and
it is FURTHER ORDERED that the Postal Service is hereby ENJOINED
from tendering nonpriority mainline bypass mail to PenAir until
PenAir satisfies the Prior Service and Capacity Requirement of 39
U.S.C. § 5402(g)(1)(A)(iv)(II) as required by 39 U.S.C. §
5402(g)(5)(C) . . . .”).
4
§ 5402(g)(1)(A)(iv)(II) as required by § 5402(g)(5)(C) and was,
therefore, eligible to receive nonpriority mainline bypass mail.
Postal Service’s SMF ¶ 30. The letter also stated, however, that
because “[t]he district court did not address whether PenAir
should receive credit for the past 13 months in which it has been
providing mainline service in Alaska . . . the actual tender of
mail to PenAir may violate the court’s injunction.” Postal
Service Opp’n to Pls.’ Mot. for Prelim. Inj., Attachment 1, Ex. B
(hereinafter, “Postal Service Ex. B”). The Postal Service
explained to PenAir that it needed clarification from the Court
regarding whether its proposed equitable tender would violate the
Court’s injunction. See Postal Service Ex. B (“[T]he Postal
Service will immediately begin tendering mail to PenAir upon the
occurrence of either of the following events: (1) the court lifts
the injunction; [or] (2) PenAir obtains an appropriate
clarification of (or modification to) the injunction, which, in
the sole judgment of the Postal Service, makes it clear that
tendering mail will not violate the court’s injunction.”).
Accordingly, on November 17, 2010, the Postal Service filed
a motion pursuant to Federal Rule of Civil Procedure 60 seeking
“clarification” as to whether it would be in violation of the
Court’s September 23, 2010 injunction if it tendered nonpriority
mainline bypass mail to PenAir pursuant to the airline’s October
12, 2010 application. Postal Service’s SMF ¶ 31; see also Civil
5
Action No. 09-2065, Docket No. 38. On December 2, 2010, the
Court denied the Postal Service’s motion. The Court explained
that “the issue on which defendant seeks clarification - ‘whether
PenAir should receive credit for the past 13 months during which
it has been providing mainline service to Alaskans’ - [was] not
properly before the Court. Specifically, the Court [found] that
the issue presented by defendant would require the Court to
entertain new factual and legal issues beyond the scope of the
Court’s Memorandum Opinion and Order.” See Civil Action No. 09-
2065, Minute Order dated Dec. 2, 2010 (internal citations
omitted).
By letter dated December 3, 2010, the Postal Service
concluded that PenAir had satisfied the Prior Service and
Capacity Requirement and authorized the issuance of nonpriority
mainline bypass mail to PenAir on the five requested mainline
routes. See Postal Service Opp’n to Pls.’ Mot. for Prelim. Inj.,
Attachment 1, Ex. F (hereinafter, “Postal Service Ex. F”).4
Shortly thereafter, on December 6, 2010, the Postal Service began
4
See also Postal Service Ex. F (discussing the Court’s
December 2, 2010 Minute Order and stating “[w]e read that minute
order as meaning that the court’s previous order was not meant to
rule one way or another on the issue of credit for the last 13
months, that the Postal Service is authorized to make eligibility
determinations (including whether PenAir should receive credit
for the past 13 months), and that tendering the mail would not
violate the injunction because the Postal Service has concluded
that the conditions governing the expiration of the injunction
have been satisfied”).
6
tendering nonpriority mainline bypass mail to PenAir. See
PenAir’s SMF ¶ 22.5
On December 8, 2010, plaintiffs filed an emergency motion
for an order to show cause why the Postal Service should not be
found in contempt in the 2009 Action, arguing that the Postal
Service had violated the Court’s injunction by resuming tender of
nonpriority mainline bypass mail to PenAir. See Civil Action No.
09-2065, Docket No. 47. On that same date, plaintiffs also filed
the instant action, in which it requested a temporary restraining
order and preliminary injunction. The Court denied plaintiff’s
request for emergency injunctive relief on December 23, 2010.
See Northern Air Cargo v. United States Postal Serv., 756 F.
Supp. 2d 116 (D.D.C. 2010) (hereinafter, “Northern Air Cargo
II”). Thereafter, plaintiffs filed a motion for summary
judgment, and defendants filed cross-motions for summary
judgment. These motions are now ripe for determination by the
Court.
5
But see Pls.’ Response to PenAir’s SMF ¶ 15
(“Plaintiffs dispute the characterization in Paragraph 22 of
Intervenor’s Factual Statement that the Postal Service ‘began’
tendering Mainline Bypass Mail to PenAir on December 6, 2010.
Considering that the Postal Service previously tendered Mainline
Bypass Mail to PenAir for ten months during the pendency of the
2009 Lawsuit, it would be more accurate to say the Postal Service
resumed tendering Mainline Bypass Mail to PenAir on December 6,
2010.”).
7
II. STANDARDS OF REVIEW
A. Summary Judgment
Summary judgment should be granted only if the moving party
has shown that there are no genuine issues of material fact and
that the moving party is entitled to a judgment as a matter of
law. See Fed. R. Civ. P. 56; Celotex Corp. v. Catrett, 477 U.S.
317, 325 (1986); Waterhouse v. Dist. of Columbia, 298 F.3d 989,
991 (D.C. Cir. 2002). “A fact is material if it ‘might affect
the outcome of the suit under the governing law,’ and a dispute
about a material fact is genuine ‘if the evidence is such that a
reasonable jury could return a verdict for the nonmoving party.’”
Steele v. Schafer, 535 F.3d 689, 692 (D.C. Cir. 2008) (quoting
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). The
party seeking summary judgment bears the initial burden of
demonstrating an absence of genuine issues of material fact.
Celotex, 477 U.S. at 322. In determining whether a genuine issue
of material facts exists, the Court must view all facts in the
light most favorable to the non-moving party. See Matsushita
Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 597 (1986);
Keyes v. Dist. of Columbia, 372 F.3d 434, 436 (D.C. Cir. 2004).
Likewise, in ruling on cross-motions for summary judgment, the
court shall grant summary judgment only if one of the moving
parties is entitled to judgment as a matter of law upon material
facts that are not genuinely disputed. St. Michael’s Med. Ctr.
8
v. Sebelius, 648 F. Supp. 2d 18, 25 (D.D.C. 2009) (citing Rhoads
v. McFerran, 517 F.2d 66, 67 (2d Cir. 1975)).
B. The Postal Service’s Interpretation of the RSIA
A challenge to an agency’s construction of a statute that it
administers is subject to the standard of review articulated in
Chevron U.S.A., Inc. v. NRDC, Inc. 467 U.S. 837 (1984). In
assessing the validity of an agency’s interpretation of a
statute, the Court must first determine “whether Congress has
directly spoken to the precise question at issue.” Id. at 842-
43. Courts “use ‘traditional tools of statutory construction’ to
determine whether Congress has unambiguously expressed its
intent,” Serono Labs., Inc. v. Shalala, 158 F.3d 1313, 1319 (D.C.
Cir. 1993), including an examination of the statute’s text,
structure, purpose, and legislative history. See Shays v. FEC,
414 F.3d 76, 105 (D.C. Cir. 2005). “If the intent of Congress is
clear, that is the end of the matter; for the court, as well as
the agency, must give effect to the unambiguously expressed
intent of Congress.” Chevron, 467 U.S. at 842-43. If, however,
“the statute is silent or ambiguous with respect to the specific
issue,” id. at 843, the court “must next determine the deference,
if any, [it] owe[s] the agency’s interpretation of the statute,
Mount Royal Joint Venture v. Kempthorne, 477 F.3d 745, 754 (D.C.
Cir. 2007) (citing United States v. Mead Corp., 533 U.S. 218(2001)). “If the agency enunciates its interpretation through
9
notice-and-comment rule-making or formal adjudication, [courts]
give the agency’s interpretation Chevron deference.” Id.“[U]nder Chevron, courts are bound to uphold an agency
interpretation as long as it is reasonable – regardless whether
there may be other reasonable, or even more reasonable, views.”
Serono Labs., 158 F.3d at 1321. “On the other hand, if the
agency enunciates its interpretation through informal action that
lacks the force of law, [courts] accept the agency’s
interpretation only if it is persuasive.” Mount Royal Joint
Venture, 477 F.3d at 754 (citing Mead, 533 U.S. at 235); see also
Christensen v. Harris County, 529 U.S. 576, 587 (2000)
(explaining that if Chevron deference is not appropriate, courts
may still accord an informal agency determination some deference
under Skidmore v. Swift & Co., 323 U.S. 134 (1944); noting that
Skidmore deference, however, is appropriate “only to the extent
that those interpretations have the ‘power to persuade’”).
III. ANALYSIS
As this Court previously explained, “[t]he merits of this
case turn on whether the Postal Service properly determined, on
December 3, 2010, that PenAir had satisfied the Prior Service and
Capacity Requirement and was therefore an eligible mainline
carrier under § 5402(g)(5)(C).” Northern Air Cargo II, 756 F.
Supp. 2d at 116. Although the parties all agree that the plain
language of the Prior Service and Capacity Requirement should
10
govern the Court’s analysis of this case, the parties adopt
markedly different interpretations of this purportedly plain
language. Specifically, plaintiffs assert that “[t]he Postal
Service’s decision to tender Mainline Bypass Mail to PenAir
contravenes the clear and unambiguous language of the Prior
Service and Capacity Requirement, and is therefore ultra vires,”
Pls.’ Mot. at 9, while defendants argue that “[t]he Postal
Service’s decision honors the plain language of the Prior Service
and Capacity Requirement.” PenAir’s Mot. at 7; see also Postal
Service’s Mot. at 10 (arguing that PenAir had satisfied the
“plain language of the RSIA” prior to receiving an equitable
tender of nonpriority mainline bypass mail in December 2010).6
It is these diametrically opposite positions that the Court must
resolve. After careful consideration of the parties’ arguments
and the applicable law, the Court concludes, for the reasons
discussed below, that the Postal Service did not exceed its
statutory authority when it determined on December 3, 2010 that
PenAir had satisfied the Prior Service and Capacity Requirement
and was therefore an eligible mainline carrier under
§ 5402(g)(5)(C).
6
Defendants alternatively argue that the Postal
Service’s interpretation of the Prior Service and Capacity
Requirement is “entirely reasonable and therefore entitled to
deference,” PenAir’s Mot. at 17; plaintiffs, by contrast, contend
that “[t]he Postal Service’s interpretation of the Prior Service
and Capacity Requirement is not ‘persuasive’ and is not entitled
to any deference from this Court,” Pls.’ Mot. at 19.
11
A. The Plain Language of § 5402(g)(1)(A)(iv)(II)
The Court’s inquiry must begin with the plain language of
the Prior Service and Capacity Requirement. If the RSIA speaks
“to the precise question at issue” then “that is the end of the
matter; for the court, as well as the agency, must give effect to
the unambiguously expressed intent of Congress.” Chevron, 467
U.S. at 842-43. As noted above, the parties agree that the plain
language of the Prior Service and Capacity Requirement is
dispositive.
The Prior Service and Capacity Requirement provides, in
relevant part, that:
The Postal Service, in selecting carriers of
nonpriority bypass mail to any point served by more
than 1 carrier in the State of Alaska, shall adhere
to an equitable tender policy within a qualified
group of carriers, in accordance with the
regulations of the Postal Service, and shall, at a
minimum, require that any such carrier– . . . (iv)
have provided scheduled service with at least the
number of scheduled noncontract flights each week
established under subparagraph (B)(ii) between 2
points within the State of Alaska for at least 12
consecutive months with aircraft– . . . (II) over
7,500 pounds payload capacity before being selected
as a carrier of nonpriority bypass mail at the
intra-Alaska mainline service mail rate.
39 U.S.C. § 5402(g)(1)(A)(iv)(II). The Court must decide,
therefore, whether this statutory language “precisely” answers
the question pending before the Court: whether the Postal Service
properly determined that PenAir had satisfied this statutory
provision when it authorized the airline to receive nonpriority
12
mainline bypass mail on the five rural Alaskan routes in December
2010.
Because it is undisputed that PenAir had been operating
mainline passenger service for nearly 16 months at the time of
the Postal Service’s selection on December 3, 2010, the principal
issue before the Court is whether the Postal Service, in
determining that PenAir had satisfied § 5402(g)(1)(A)(iv)(II),
impermissibly credited PenAir for the time during which it was
unlawfully tendered nonpriority mainline bypass mail.
Plaintiffs’ principal argument is that “[t]he plain language
of the Prior Service and Capacity Requirement expressly mandates
that a carrier must ‘have provided’ passenger service with large
aircraft for twelve consecutive months ‘before’ being selected as
a carrier of Mainline Bypass Mail.” Pls.’ Mot. at 1. Plaintiffs
assert, therefore, that “[t]he Postal Service’s determination
that PenAir should receive credit for the ten-month period during
which PenAir received unlawful tender effectively ignores both
the past tense of the verb ‘provide’ and excises ‘before’ from
the Prior Service and Capacity Requirement.” Pls.’ Mot. at 11;
see also Pls.’ Mot. at 13 (“The phrase ‘having provided’
expressly indicates that the twelve months of mainline flights
must occur before the current selection. For the word ‘before’
to have any meaning - and thus not be rendered superfluous - it
must be read as imposing the additional (and common sense)
13
limitation that carriers may not receive Mainline Bypass Mail
revenue during the twelve-month qualification period.”).
Accordingly, plaintiffs’ argue that the Postal Service’s
interpretation of § 5402(g)(1)(A)(iv)(II) must be rejected
because it “violates a ‘cardinal principle’ of statutory
construction that ‘no clause, sentence, or word shall be
superfluous, void, or insignificant.’” Pls.’ Mot. at 11 (quoting
TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001)); see also Pls.’
Reply at 5 (“The Postal Service ignores the clause ‘before being
selected as a carrier of nonpriority mainline bypass mail,’ while
PenAir’s interpretation render the clause mere surplusage.”).
Plaintiffs further argue that “[n]otwithstanding the plain
language of the provision itself, other RSIA provisions
demonstrate that Congress did not intend a prospective entrant,
such as PenAir, to receive credit for a period during which it
received an illegal (or unqualified) tender of Mainline Bypass
Mail.” Pls.’ Mot. at 16. In support of this position,
plaintiffs cite 39 U.S.C. § 5402(p)(3), which authorizes the
Postal Service to waive the requirements of § 5402(g)(1)(A)(iv)
“in extreme cases of lack of competition” if “absolutely
necessary to meet the minimum needs of the community.” 39 U.S.C.
§ 5402(p)(3).7 This subsection further provides that “[t]he
7
This provision, in its entirety, states as follows: “To
ensure adequate competition among passenger carriers on a
mainline route in the State of Alaska the Postal Service or the
14
receipt of waivers and subsequent operation of service on a city
pair route under this subsection shall not be counted towards
meeting the requirements of any part of this section for any
other city pair route.” Id. Plaintiffs argue that “[t]he fact
that Congress specifically contemplated the possibility that the
Postal Service might need to waive the Prior Service and Capacity
Requirement . . . but nonetheless clarified that such waiver
operations ‘shall not be counted’ towards the Prior Service and
Capacity Requirement further demonstrates the absurdity of the
Postal Service’s and PenAir’s position.” Pls.’ Mot. at 16-17.
Finally, plaintiffs argue that “PenAir cannot benefit from
the erroneous statutory interpretation this Court rejected in the
2009 Lawsuit.” Pls.’ Mot. at 17. Citing cases in which courts
have purportedly “refused to allow parties to benefit from ultra
vires acts by an agency,” plaintiffs assert that “the Postal
Secretary may waive the requirements of subsection (g)(1)(A)(iv),
(g)(2)(E), (g)(4), or (g)(5), or any provision of subsection (h)
if a 121 bush passenger carrier seeks tender of nonpriority
bypass mail on a mainline route in the State of Alaska not served
by a 121 mainline passenger carrier and the 121 bush passenger
carrier provides substantial passenger service on the route.
Waivers provided for under this paragraph shall be granted only
in extreme cases of lack of competition and only to extent that
are absolutely necessary to meet the minimum needs of the
community. Waivers granted under this subsection shall cease to
be valid once a qualified mainline passenger carrier begins
providing service and seeks tender of nonpriority bypass mail in
accordance with this section on the city pair route. The receipt
of waivers and subsequent operation of service on a city pair
route under this subsection shall not be counted towards meeting
the requirements of any part of this section for any other city
pair route.” 39 U.S.C. § 5402(p)(3).
15
Service is without authority to credit PenAir for the ten months
during which it received an unlawful tender of Mainline Bypass
Mail.” Pls.’ Mot. at 17 (citing Smith v. WMATA, No. 95-0687,
1997 U.S. Dist. LEXIS 4504, at *28 (D.D.C. April 4, 1997); Davis
v. Moore, 772 A.2d 204, 209-11 (D.C. 2001)); see also Pls.’ Reply
at 6-8 (arguing that “PenAir received millions of dollars in
compensation for the unlawful tender of Mainline Bypass Mail, but
it should not be permitted to count the months it received an
unlawful tender of Mainline Bypass Mail towards satisfying the
Prior Service and Capacity Requirement”).
Defendants, by contrast, urge the Court to reject these
arguments explaining that, pursuant to the plain language of the
Prior Service and Capacity Requirement, “‘in selecting carriers
of nonpriority [mainline] bypass mail,’ the Postal Service need
only confirm that carriers have provided the requisite number of
mainline flights ‘for at least 12 consecutive months . . . before
being selected as a [mainline] carrier.’” PenAir’s Opp’n at 1
(quoting 39 U.S.C. § 5402(g)(1)(A)(iv)). According to
defendants, therefore, whether the Postal Service complied with
this statutory provision is “a simple counting exercise: Did the
carrier actually fly a sufficient number of flights with mainline
aircraft during the 12 months that immediately preceded the
16
Postal Service’s selection?” PenAir’s Mot. at 1.8 Because it is
undisputed that PenAir operated more than 3000 mainline scheduled
flights for 16 consecutive months before the Postal Service
approved PenAir’s request on December 3, 2010, defendants contend
that “[this] should be the end of the matter.” PenAir’s Mot. at
1.
Defendants also argue that plaintiffs’ interpretation of the
plain language of § 5402(g)(1)(A)(iv) must be rejected because it
“improperly reads additional requirements” into the statutory
provision. Postal Service’s Opp’n at 4. In particular,
defendants urge the Court to reject plaintiffs’ argument that the
word “before” “‘must be read as imposing the additional (and
common sense) limitation that carriers may not receive Mainline
Bypass Mail revenue during the twelve-month qualification
period.’” Postal Service’s Opp’n at 5-6 (quoting Pls.’ Mot. at
13) (emphasis added by Postal Service); see also PenAir’s Opp’n
at 8-9. Defendants assert that “[p]laintiffs cannot read the
‘additional limitation’ – that a carrier cannot carry any bypass
8
See also PenAir’s Reply at 4 (“The phrase ‘in
selecting’ is a present-tense construction that creates a
prospective command: It speaks to what the agency must do when
faced with new applications to carry that mail. . . . The phrase
‘being selected’ likewise looks to the present; it does not say
‘before having been selected at some point in the past.’ By
using parallel constructions throughout § 5402(g)(1)(A) -
‘selection’ and ‘selecting’ - Congress left no doubt about the
point that the 12 months run backwards from: the date the carrier
is presently ‘selected’ by the agency.”).
17
mail before being selected as a carrier of nonpriority bypass
mail at an applicable intra-Alaska mainline service mail rate
under Section (g)(5)(C) – into Section (g)(1)(A)(iv)(II) when the
plain language does not provide for it.” Postal Service’s Opp’n
at 6-7; see also Postal Service Opp’n at 6 (“[N]owhere does
Section (g)(1)(A)(iv)(II) state that a carrier can never have
carried any bypass mail before being selected as a carrier of
nonpriority bypass mail at an applicable intra-Alaska mainline
service mail rate. If anything, the RSIA is completely silent on
this issue.”9).
In addition, the Postal Service also maintains that
“[c]ontrary to Plaintiffs’ assertions, the Postal Service did not
read out the words ‘provide’ or ‘before’ from the statute.”
Postal Service’s Opp’n at 7. Instead, the agency explains that
it “applied the plain language of the statute and determined that
PenAir did provide service in aircraft with the appropriate
capacity at least twice a week for 12 months before PenAir
submitted its 2010 request for tender.” Postal Service’s Opp’n
at 7.
9
As discussed below, defendants urge the Court, in the
event that the Court determines that the RSIA is “silent” or
“ambiguous” on the precise question at issue, see Chevron, 467
U.S. at 837, to defer to the Postal Service’s decision to tender
nonpriority mainline bypass mail to PenAir in December 2010 as a
reasonable agency action, see Postal Service’s Mot. at 10-12.
18
With respect to plaintiffs’ argument regarding the waiver
provision of § 5402(p)(3), defendants contend that “[s]ubsection
(p)(3) demonstrates that Congress knew how to do what the
Plaintiffs are asking this Court to do for it: revise the statute
to carve out from the 12-month requirement a subset of flights
that would otherwise qualify.” PenAir’s Opp’n at 10. Defendants
further assert that it is not “any answer to say that Congress
perhaps simply overlooked - or never anticipated - that it might
need to expressly prohibit a subset of flights from the ordinary
12-month rule. That sort of argument seeks ‘not a construction
of a statute, but, in effect, an enlargement of it by the court,
so that what was omitted, presumably by inadvertence, may be
included within its scope.’” PenAir’s Opp’n at 10-11 (quoting
Nat’l R.R. Passenger Corp. v. United States, 431 F.3d 374, 378
(D.C. Cir. 2005)).
Finally, defendants maintain that plaintiffs’ arguments
protesting PenAir’s ability to benefit from the Postal Service’s
erroneous statutory interpretation in the 2009 Action, have
“absolutely nothing to do with plain language or statutory
interpretation.” PenAir’s Opp’n at 13; see also PenAir’s Opp’n
at 13 (arguing that the cases cited by plaintiffs do not
“remotely suggest[] that the Postal Service is precluded from
acknowledging the indisputable fact that PenAir has flown for
more than 12 consecutive months”).
19
Having carefully considered the parties’ arguments,10 the
Court concludes that the Postal Service’s determination that
PenAir had satisfied the Prior Service and Capacity Requirement
as of December 3, 2010 is consistent with the plain language of
10
The Court will also note that each of the parties urges
the Court to find that their interpretation of the “plain
language” of the Prior Service and Capacity Requirement is
consistent with the legislative history of the RSIA. For
instance, plaintiffs argue that “[t]he import of
[§ 5402(g)(1)(A)(iv)(II)] is obvious: Congress wanted to ensure
that any ‘new’ carriers first demonstrate their economic
viability and sustained commitment to the rural Alaskan
communities as a mainline carrier operating Large Aircraft before
they collected any Mainline Bypass revenues.” Pls.’ Mot. at 6;
see also Pls.’ Mot. at 22-23 (arguing that “market stability” was
one of Congress’s “primary concerns” in passing the RSIA). The
Postal Service, by contrast, contends that its decision to tender
mail to PenAir “fits squarely within the purposes of the RSIA -
that is, to provide residents in the five communities at issue
with reliable passenger service on routes where no mainline
passenger carrier had been serving their communities.” Postal
Service’s Mot. at 10. The Postal Service further argues that:
“As the Court acknowledged in the 2009 Lawsuit, one of the
primary purposes of the RSIA was to provide Alaskans with
affordable and reliable mail, passenger, and freight service.
Plaintiffs’ interpretation of Section (g)(5)(C), however, would
prevent a qualified carrier from offering mail and passenger
service to residents in the five communities at issue, while
Plaintiffs provide no passenger service. This is antithetical to
the stated purposes of the RSIA.” Postal Service’s Opp’n at 13
(internal citations omitted). Because the history and policy
considerations that underlie the RSIA support the positions of
both plaintiffs and defendants, the Court’s analysis focuses on
the statutory text. See, e.g., Lamie v. United States Trustee,
540 U.S. 526, 540 (2004) (“These competing interpretations of the
legislative history make it difficult to say with assurance
whether petitioner or the Government lays better historical claim
to the congressional intent. . . . These uncertainties illustrate
the difficulty of relying on legislative history here and the
advantage of our determination to rest our holding on the
statutory text.”).
20
§ 5402(g)(1)(A)(iv)(II). Specifically, before the Postal Service
selected PenAir as a carrier of nonpriority mainline bypass mail
in December 2010, the Postal Service determined - pursuant to the
plain language of the Prior Service and Capacity Requirement -
that PenAir “ha[d] provided scheduled service with at least the
number of scheduled noncontract flights each week established
under subparagraph (B)(ii) between 2 points within the State of
Alaska for at least 12 consecutive months with aircraft– . . .
over 7,500 pounds payload capacity . . . .” 39 U.S.C.
§ 5402(g)(1)(A)(iv)(II). The Court is simply not persuaded by
plaintiffs’ argument that Congress intended, through its use of
the word “before,” to impose “the additional . . . limitation
that carriers may not receive Mainline Bypass Mail revenue during
the twelve-month qualification period.” Pls.’ Mot. at 13. As
this Court previously recognized, courts “‘must presume that a
legislature says in a statute what it means and means in a
statute what it says[.]’” Northern Air Cargo I, 741 F. Supp. 2d
at 52 (quoting Teva Pharm. Indus. v. Crawford, 410 F.3d 51, 53
(D.C. Cir. 2005)). While the Court finds it unlikely that
Congress anticipated the factual scenario presented in this case
- i.e., that a carrier would fulfill the requirements set forth
in § 5402(g)(1)(A)(iv)(II) while carrying mainline bypass mail
pursuant to an ultra vires tender by the Postal Service - this
does not change the fact that PenAir satisfied the plain language
21
of § 5402(g)(1)(A)(iv)(II) by operating the requisite number of
mainline scheduled flights for more than 12 consecutive months
before the Postal Service selected PenAir as an eligible mainline
carrier on December 3, 2010. And although it might have been
wise for Congress to add the provision urged by plaintiffs, this
Court is not at liberty to infer an additional statutory
requirement where none exists. See Lamie v. United States
Trustee, 540 U.S. 526, 538 (2004) (rejecting petitioner’s
argument that would have required the Court to “read an absent
word into the statute”; explaining that such an argument “would
result not [in] a construction of [the] statute, but, in effect,
an enlargement of it by the court, so that what was omitted,
presumably by inadvertence, may be included within its scope”
(internal quotation marks omitted)); see also Joseph v. U.S.
Civil Serv. Comm’n, 554 F.2d 1140, 1155 (D.C. Cir. 1977)
(“[Courts] cannot rewrite [a] statute for unforeseen
circumstances. That power belongs to the legislature alone.”).
The Court concludes, therefore, that the Postal Service’s
interpretation of the RSIA accords with the plain, ordinary
meaning of the language selected by Congress. Accordingly, the
Postal Service did not exceed its statutory authority when it
selected PenAir to receive an equitable tender of nonpriority
mainline bypass mail on the five rural Alaskan routes in December
2010.
22
B. The Postal Service’s Interpretation of the RSIA
“When the words of a statute are unambiguous[,] . . .
judicial inquiry is complete,” Teva Pharm., 410 F.3d at 53(internal quotation marks omitted), and the court need not “reach
step two” of the Chevron framework. Id. Even if, however, the
Prior Service and Capacity Requirement were ambiguous with
regards to whether the Postal Service could credit PenAir for the
time during which it was unlawfully tendered nonpriority mainline
bypass mail, the Court concludes that the Postal Service’s
determination that PenAir had satisfied the requirements of
§ 5402(g)(1)(A)(iv)(II) as of December 3, 2010 to be both
reasonable and persuasive in light of the goals of the RSIA,11
and entitled to some deference by this Court under either Chevron
11
See Postal Service’s Reply at 7-8 (explaining that one
of the RSIA’s goals is to “‘ensure that residents of rural and
isolated communities in Alaska continue to have affordable,
reliable, and safe passenger service’”; stating that “[t]he
Postal Service’s decision to tender mail to PenAir on December 6,
thus compensating a mainline passenger carrier through the
payment of bypass mail revenues for offering reliable passenger
service to communities that did not previously receive any
regular mainline passenger service, effectuates that purpose”
(quoting Northern Air Cargo I, 741 F. Supp. 2d at 44)); Postal
Service’s Mot. at 10 (emphasizing that its decision to tender
nonpriority mainline bypass mail to PenAir in December 2010 “fits
squarely within the purposes of the RSIA - that is, to provide
residents in the five communities at issue with reliable
passenger service on routes where no mainline passenger carrier
had been serving their communities”); see also generally supra
n.2 (highlighting Congress’s goals in passing the RSIA).
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or Skidmore.12 See City of Dania Beach v. FAA, 628 F.3d 581, 586
(D.C. Cir. 2010) (finding that “some deference is due the
agency’s interpretation under either Chevron U.S.A. v. Natural
Resources Defense Council, 467 U.S. 837 (1984), or Skidmore v.
Swift & Co., 323 U.S. 134, 140(1944) . . . [but] we need not
12
The Court is not persuaded by plaintiffs’ argument that
the Postal Service’s December 2010 decision is entitled to no
deference because it reflects “a total lack of deliberative
process.” Pls.’ Mot. at 21 (internal quotation marks omitted).
The Court finds that this case is distinguishable from the 2009
Action, in which “the Court [was] left with no indication of who
the decision-makers were, what they considered, or how they
reached their decision.” Northern Air Cargo I, 741 F. Supp. 2d
at 52 n.13. Specifically, in this case, “[n]umerous Postal
Service employees in the Commercial Air Operations group in the
Postal Service’s Headquarters in Washington, D.C. and in the
Western Area [Distribution Networks Office], through multiple
discussions and in consultation with the Postal Service Law
Department, carefully considered the issues raised by PenAir’s
request for tender, including the Plaintiffs’ contention that
PenAir had not yet satisfied the Prior Service and Capacity
Requirement of section 5402(g)(1)(A)(iv).” Postal Service Opp’n
to Pls.’ Mot. for Prelim. Inj., Attachment 1, Declaration of
Steve Deaton (hereinafter, “Deaton Decl.”) ¶ 8. Following these
discussions, the Postal Service then determined - consistent with
the plain text of the statute - that “PenAir had satisfied the
Prior Service and Capacity Requirement . . . by flying a mainline
passenger aircraft between any two points within the state of
Alaska for at least 12 months, after reviewing the flight
schedules submitted to the Postal Service as well as data
provided electronically to the Postal Service by the Official
Airline Guide[.]” Deaton Decl. ¶ 4. Nor is the Court persuaded
that a June 25, 2001 letter from the Postal Service to Intra-
Alaska Air Carriers, involving the agency’s interpretation of a
pre-RSIA version of the Prior Service and Capacity Requirement,
precludes the Court from defering to the Postal Service’s
decision in this action. See Postal Service’s Reply at 3 n.4
(arguing that any position expressed by the Postal Service before
the enactment of the RSIA is irrelevant to whether it properly
applied the Prior Service and Capacity Requirement contained in
the RSIA).
24
resolve which”); see also, e.g., Coal. of Battery Recyclers Ass'n
v. EPA, 604 F.3d 613, 625 (D.C. Cir. 2010) (concluding that even
if the disputed statutory provision was ambiguous, the agency
adopted a reasonable interpretation of the statute’s requirements
under Chevron step two and was therefore entitled to deference by
the court); Teva Pharms., USA, Inc. v. Leavitt, 548 F.3d 103, 106
n.1 (D.C. Cir. 2008) (same).
IV. CONCLUSION
In sum, because the Postal Service’s decision to tender
nonpriority mainline bypass mail to PenAir in December 2010 on
five rural Alaskan mainline routes comported with the plain
language of the Prior Service and Capacity Requirement of
§ 5402(g)(1)(A)(iv)(II), and was reasonable and persuasive in
light of the goals of the RSIA, the Court concludes that the
Postal Service did not exceed the authority delegated to it by
Congress. Accordingly, for the foregoing reasons, the Court
DENIES plaintiffs’ motion for summary judgment and GRANTS
defendants’ cross-motions for summary judgment. An appropriate
Order accompanies this Memorandum Opinion.
SO ORDERED.
Signed: EMMET G. SULLIVAN
United States District Judge
June 10, 2011
25