D.C. District Court Dismisses Delta’s Appeals Against U.S. Ex-Im Bank

In a series of three decisions published on March 30, 2015, the U.S. District Court for the District of Columbia has dismissed appeals brought by Delta Air Lines and other plaintiffs against the U.S. Export-Import Bank relating to litigation initiated in 2011 challenging the Bank’s issuance of loan guarantees to Air India for the purchase of certain Boeing aircraft.

Delta Air Lines, the Air Transport Association of America and certain other plaintiffs maintained, among other things, that the Bank violated the Export-Import Bank Act and the Administrative Procedure Act through the adoption and application of certain internal economic impact procedures ("EIPs"), which the Bank uses to assess the economic effects of potential transactions within its broader process of determining whether to approve an application for Bank financing.

The Bank had approved the challenged Air India commitments by applying the then-operative 2007 EIPs, which included an "exportable goods screen" which categorically excluded from a more rigorous and detailed economic impact analysis any proposed transaction that would lead to the foreign provision of services, such as airline services, as opposed to the foreign production of exportable goods.

The plaintiffs challenged that the exportable goods screen improperly excluded from such detailed economic impact analysis the Bank’s financing of foreign aircraft transactions, which the Bank deems to result in the production of exportable services (i.e., airline seat capacity), not exportable goods.

Although the District Court decided in favor of the Bank, on appeal the D.C. Circuit Court reversed and ordered that the matter be remanded to the Bank, without vacating any of the Bank’s actions, for further consideration.

In Delta Air Lines, Inc. v. Export-Import Bank of the United States, __F. Supp. 3d __, No. CV 13-0192(RC), 2015 WL 1421206 (D.D.C. March 30, 2015), the court dismissed the plaintiff’s challenge to the Bank’s more recently adopted 2013 EIPs, on procedural grounds.

In Delta Air Lines, Inc. v. Export-Import Bank of the United States, __F. Supp. 3d __, No. CV 13-0424(RC), 2015 WL 1424021 (D.D.C. March 30, 2015), the court granted summary judgment in favor of the Bank in connection with a challenge brought by the plaintiffs to five additional aircraft financing transactions that had been approved by the Bank under the 2007 EIPs.

In Delta Air Lines, Inc. v. Export-Import Bank of the United States, __F. Supp. 3d __, No. CV 14-0042(RC), 2015 WL 1424152 (D.D.C. March 30, 2015), the court granted summary judgment in favor of the Bank, concluding that the Bank is authorized to adopt categorical screens in an attempt to limit further analysis to only those transactions that are "likely to have an adverse effect on industries … and employment in the United States, and the Bank’s adoption and continued use of the exportable goods screen in the 2007 EIPs and beyond constituted rational agency decision making."