Wilson Air Ctr., LLC v. Memphis & Shelby Cnty. Airport Auth.-109

FAA Docket No:

16-99-10

Lexis Cite:

2000 FAA LEXIS 752

Westlaw Cite:

2000 WL 1130530

Author:

Bennett, David L., Director

Author Title:

Director

Complainant(s):

Wilson Air Center, LLC

Respondent(s):

Memphis and Shelby County (Tenn.) Airport Authority

Airport(s):

Memphis International Airport (MEM)

History:

Affirmed by Final Agency Decision and Order of Aug. 30, 2001. See Determination No. 91.

Holding:

Dismissing complaint.

Abstract:

Complainant, Wilson Air Center, LLC filed a complaint against Respondent, Memphis and Shelby County Airport Authority, sponsor of Memphis International Airport, alleging that Respondent violated Grant Assurances 22 and 23 by providing preferential treatment to a competing FBO. The Director found Respondent not in violation and dismissed the Complaint.|Economic Nondiscrimination (Grant Assurance 22):|The difference in lease rates between Complainant and its competitor was not unjustly discriminatory where the differences resulted from agreements entered into at different times, and with different lease terms. (p. 19). The addition of taxilane acreage to the Complainant's competitor leasehold was not evidence of unjust economic discrimination, because the addition only resulted in a monetary impact too small to be considered dissimilar treatment. (pp. 19-20).|In calculating the rent that the competing FBO would pay for its leasehold, it was permissible to consider the leasehold improvements upon which future rent would be assessed. (p. 22). The differences between the rent terms for a building used by the competing FBO and those for a building under negotiation with Complainant did not constitute unjust economic discrimination, because the facilities were not similarly situated (they differed with respect to age, character, condition, location, potential uses, permanence and needed improvements). (pp. 22-23).|Respondent did not incur an obligation to make a parcel affordable to Complainant for its expansion simply because it had provided option parcels for continued growth of the competing FBO's operation. (p. 24).|The Respondent’s failure to consider Complainant’s interest in leasing the competing FBO's option parcels was reasonable, because Complainant only inquired about the parcels after Respondent had resolved to grant them to its competitor and the grant was in keeping with Respondent’s attempts to reconfigure airport layout. (p. 26). It was not unreasonable and unjustly discriminatory for Respondent to deny Complainant its desired parcel where Complainant had not submitted a development plan showing how such parcel would be used. (p. 27).|Exclusive Rights (Assurance 23):|FAA could not find that Respondent granted a constructive exclusive right since it did not find that Respondent had unjustly discriminated against Complainant and Complainant did not show that it had been excluded from offering aeronautical services. (p. 28)|“The fact that the Complainant does not enjoy the ability to offer every variety of aeronautical service upon terms it deems sufficiently advantageous or at the location of its choice does not constitute the granting of an exclusive right to its FBO competitor.” (p. 28).|Failure to Pursue a Self-Sustaining Strategy:|Respondent could accept required capital investments in lieu of rent upon determining that the improvements benefited Respondent and aeronautical users of the Airport, and such benefits were adequate to constitute a self-sustaining lease structure. (p. 28).

Index Terms:

Wilson Air Ctr., LLC v. Memphis & Shelby Cnty. Airport Auth. -- No. 16-99-10