Alaska Airlines Renews Request for Open DOT Review of Virgin America’s Ownership Status

Alaska Airlines today renewed its request that the U.S. Department of Transportation (DOT) open up its ongoing review of Virgin America's current and prospective citizenship status to public...

Alaska Airlines today renewed its request that the U.S. Department of Transportation (DOT) open up its ongoing review of Virgin America’s current and prospective citizenship status to public scrutiny and comment.

Alaska’s filing this morning follows two petitions earlier this year by the carrier requesting a public inquiry into whether Virgin America, founded by the British Virgin Group, complies with U.S. foreign ownership and control restrictions on domestic carriers. "Alaska makes this request to ensure DOT holds all airlines to the same standard of compliance with U.S. law," said Keith Loveless, Alaska’s general counsel.

Similar requests to DOT also have been made by Sen. Patty Murray, chairperson of the Senate Transportation, Housing and Urban Development and Related Agencies Appropriations Subcommittee, and Rep. James Oberstar, chairperson of the House Transportation and Infrastructure Committee, as well as by the Air Line Pilots Association, Association of Flight Attendants-CWA and Aircraft Mechanics Fraternal Association.

Federal law requires U.S.-based air carriers to be U.S. "citizens." To qualify, the outstanding voting interests of the air carrier must be at least 75-percent owned by U.S. citizens and the carrier must also be effectively controlled by U.S. citizens.

Today’s filing by Alaska Airlines points out that Virgin America has not refuted news reports in March 2009 that Virgin’s U.S. shareholders disposed of their financial interest in the airline. Sen. Murray’s July 9, 2009, letter to DOT states that "U.S. investors may have retained title to the shares; however, title alone, absent any economic interest in the shares, would not appear to satisfy the U.S. citizenship requirements." It also notes it is "past time for DOT to initiate a proceeding allowing for public comment prior to DOT reaching a final decision on a new ownership and control structure [for Virgin]."

Rep. Oberstar’s April 2, 2009, letter to DOT likewise states, "If the Department finds that the equity funds have disposed of their financial interest, then I strongly urge the Department to conduct a public proceeding to examine the question of Virgin America’s citizenship."

In its petition today, Alaska Airlines states that, "With Congressional leaders Senator Murray and Chairman Oberstar joining Alaska’s call for a hearing and the Department’s former Inspector General explicitly stating that controversial citizenship proceedings should be opened for public review, the only appropriate step for the Department to take is to allow for public scrutiny and comment. To not do so and continue to process this controversial proceeding behind closed doors is not in the public interest."

The following documents are available on the carrier’s Web site at

  Alaska Airlines' petitions (Aug. 21, March 12 and Feb. 10, 2009)

  Sen. Murray's letter  (July 9, 2009)

  Rep. Oberstar's letter (April 2, 2009)

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SOURCE: Alaska Airlines

CONTACT: Bobbie Egan, +1-206-392-5134, or Caroline Boren,
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