A. Background and Parties
1. This matter was initiated by several complaints filed with the United States Department of Justice (Department) against Alamo Rent-A-Car, LLC (Alamo) and National Car Rental System, Inc. (National), wholly-owned subsidiaries of ANC Rental Corporation (ANC). The complaints alleged that Alamo and National violated Title III of the Americans with Disabilities Act of 1990 (ADA), 42 U.S.C. §§12101, et seq., by denying individuals who use wheelchairs full and equal access to the transportation services that Alamo and National provide to transport their respective customers between various airport terminals and the adjacent rental car lot that services each such airport terminal. The complaints were investigated by the Department under the authority granted by section 308(b) of the ADA.
2. The parties to this Settlement Agreement (Agreement) are the United States of America; ANC Rental Corporation, a Delaware corporation, whose principal place of business is located at 200 South Andrews Ave., Ft. Lauderdale, Florida, 33301; Alamo Rent-A-Car, LLC; and National Car Rental System, Inc. Entities that own and operate Alamo and National locations under licensing agreements with ANC or its subsidiaries (the “Licensees”) are not covered by this Agreement, except as otherwise provided in paragraphs 19 through 22 below. Hereinafter, ANC, Alamo, and National shall collectively be referred to as the Respondents.
3. On November 13, 2001, ANC Rental Corporation, as well as its direct and indirect subsidiaries (including Alamo and National), filed voluntary petitions under chapter 11 of title 11, U.S.C. in the United States Bankruptcy Court for the District of Delaware, Case No. 01-11200 (MFW) (Jointly Administered).
4. ANC, Alamo, and National own and/or operate rental car facilities at approximately fifty (50) airports nationwide. These airport locations are further defined in paragraph 11 below and are hereinafter referred to as Corporate-Owned Locations. This Agreement covers services provided at these Corporate-Owned Locations only, except as otherwise provided in paragraphs 19 through 22 below.
5. At certain Corporate-Owned Locations Alamo and National operate shuttlebus vehicles to transport customers between the airport terminal and the related car rental lot. Until recently, these shuttlebus vehicles were operated under either the “Alamo” or the “National” corporate identity. As part of the ongoing bankruptcy reorganization, Alamo and National have recently consolidated shuttlebus operations at some of their airport locations, so that the shuttlebus vehicles at some airport locations are jointly operated by Alamo and National.
6. In order to avoid unnecessary and costly litigation, the parties have agreed to resolve this action as set forth below.B. Definitions
7. Alamo and National are each public accommodations, as defined in section 301(7)(e) of the ADA, 42 U.S.C. § 12181(7)(e), and its implementing regulation, 28 C.F.R. § 36.104. With respect to the shuttle bus systems that Alamo and National operate at airport locations, Alamo and National are private entities, as defined in section 301(6) of the ADA, 42 U.S.C. § 12181(6), and its implementing regulations, 28 C.F.R § 36.104 and 49 C.F.R. § 37.3, which are not primarily engaged in the business of transporting people.
8. Based on its investigation, the Department concluded that Alamo and National operated each airport shuttle bus transportation system that was the subject of a complaint as a fixed route system, as such term is defined in section 301(4) of the ADA, 42 U.S.C. § 12181(4), and its implementing regulation, 49 C.F.R. § 37.3. The ADA imposes certain obligations on private operators of fixed route systems. 42 U.S.C. § 12182(b)(2)(B); 49 C.F.R. § 37.101. This Agreement treats all of Alamo’s and National’s shuttle bus systems as fixed route systems. Alamo and National do not concede that such systems are fixed route systems and the Department has not investigated the manner in which such shuttle systems, other than those that were the subject of a complaint, are operated, in order to make a determination as to the type of system being operated in each location.
9. The Department determined that ANC, Alamo, and National were in violation of the ADA with respect to the accessibility of a substantial number of their shuttle bus vehicles.
10. Alamo and National maintain that they are not in violation of the ADA, and that their shuttle bus transportation systems are demand responsive systems, as such term is defined in section 301(3) of the ADA, 42 U.S.C. § 12181(4). Alamo and National further believe that they provide equivalent, and indeed enhanced, pick-up and drop-off services for their disabled customers so that they are not in any way delayed or inconvenienced when renting vehicles.
11. “Corporate-Owned Locations” are all of the Alamo and National rental car businesses at airport locations where shuttle services are provided by Alamo and/or National, and that are owned and/or operated by ANC and/or its direct or indirect subsidiaries, including Alamo and National, as of the Effective Date of this Agreement, as defined in Paragraph 28 below. This excludes the businesses at the following six (6) airport locations, which are owned and operated by Licensees: Phoenix, Arizona; San Antonio, Texas; Providence, Rhode Island; Harrisburg, Pennsylvania; Akron, Ohio; Indianapolis, Indiana. Respondents will provide a list of the Corporate-Owned Locations to the Department within thirty (30) days of the Effective Date of this Agreement.
12. “Larger Vehicles” are shuttlebus vehicles with a seating capacity in excess of 16 passengers (including the driver).
13. “Smaller Vehicles” are shuttlebus vehicles with a seating capacity of 16 or fewer passengers (including the driver).
14. An “Accessible” shuttlebus vehicle is a vehicle that is readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs, and that meets the Accessibility Specifications for Transportation Vehicles set forth in 49 C.F.R. Part 38, Subpart B.C . Actions Regarding Shuttle Vehicle Fleet and Operations
15. Within sixty (60) calendar days of the Effective Date of this Agreement, as defined below, the Respondents agree to place at least one (1) working Accessible shuttlebus vehicle in operation at each Corporate-Owned Location. Respondents further agree to maintain and operate at least one (1) working Accessible shuttlebus vehicle at each Corporate-Owned Location for as long as ANC, Alamo, or National, and their respective successors and/or assigns operate a shuttlebus fleet (or otherwise make shuttlebus services available) at that location. At Corporate-Owned Locations where Alamo and National have consolidated their shuttlebus fleets and operate a single fleet, the Respondents agree to maintain and operate a minimum of one (1) Accessible shuttlebus vehicle for the combined fleet.
16. The Respondents agree that, as a continuation of the policy established in approximately 2000, all Larger Vehicles purchased or leased after the Effective Date of this Agreement, and continuing for the period each entity and its successors and/or assigns operate a shuttlebus fleet (or otherwise make shuttlebus services available to its customers), will be Accessible.
17. The Respondents agree that, beginning in the fiscal year that commences on October 1, 2003, at least 10% (ten percent) of the Smaller Vehicles purchased or leased each fiscal year, will be Accessible, unless the number of Larger Vehicles purchased or leased in that fiscal year exceeds the number of Smaller Vehicles purchased in that same fiscal year. When calculating 10%, any fraction will be rounded to the nearest whole number, and .5 will be rounded to the next greater whole number. This 10% requirement will continue until all of the Larger Vehicles in the Alamo and National fleet purchased or leased after August 25, 1990, are Accessible, or until the expiration of this Agreement, whichever comes sooner.
18. Respondents have represented to the Department that the shuttlebus operations at each Corporate-Owned Location meet the standard for equivalent service set forth in 49 C.F.R. § 37.105. Respondents agree to ensure that their respective shuttlebus operations at each Corporate-Owned Location continue to meet that standard. If Alamo and/or National fail to provide equivalent service at any of their locations, nothing herein excuses Alamo and/or National from full compliance with the ADA, including 42 U.S.C. § 12182(b)(2)(B)(ii) and
49 C.F.R. §37.101(c), at such location.D. Policies and Training
19. Alamo and National each agree to create a written Statement of Policies and Procedures for the Provision of Services to Individuals Who Use Wheelchairs (Policy Statement), that will set out all policies and procedures that individuals with mobility impairments, including individuals who use wheelchairs, must take or be aware of in order to get full and equal service in renting a car, including traveling between the airport terminal and the rental car lot. The Policy Statement shall include procedures for providing equivalent service to customers with disabilities, including those who use wheelchairs, that meet the equivalent service standard set forth in 49 C.F.R. § 37.105. The Respondents shall submit the Policy Statement to the United States for its review and approval, which shall not be unreasonably withheld, within thirty (30) days of the Effective Date of this Agreement, and shall implement the policy set forth therein within thirty (30) days after receipt of the United States’ approval.
20. Within thirty (30) days after receipt of the United States’ approval of the Policy Statement, Alamo and National shall disseminate copies of the Policy Statement to all appropriate employees with a role in the car reservation, pickup, and/or delivery processes. Within an additional thirty (30) days, Respondents shall train all such employees on how to provide service to individuals with disabilities and specifically on how to implement the policies and procedures contained in the Policy Statement, within the scope of their responsibilities. All such new employees will receive the same training within thirty (30) days of the first day each such employee reports to work. All employees required to receive training under this paragraph will be reminded of these policies and procedures every year following the Effective Date of this Agreement. Alamo and National shall incorporate the new policies and procedures into all appropriate training manuals and programs for employees.
21. All prospective renters, upon request, shall be advised of the Policy Statement. A copy of the Policy Statement shall be posted on Alamo’s and National’s web sites and shall be available at each airport rental car service center to all prospective renters, upon request, following the Effective Date of this Agreement.
22. Within sixty (60) days of the Effective Date of this Agreement, Alamo and National shall notify all current Licensees of the modification in policies and procedures described in Paragraphs 19, 20, and 21 above, shall provide such Licensees with a copy of the Policy Statement, and shall encourage current Licensees to adopt such policies and procedures. Alamo and National shall require all Licensees entering into a new License agreement, and shall require, when permissible, all Licensees renewing an existing License agreement, on or after the Effective Date of this Agreement to adopt the changes in policies and procedures described above in Paragraphs 19, 20, and 21, and to comply with the ADA in all respects.E . Implementation and Enforcement of the Settlement Agreement
23. The Department may review compliance with this Agreement during the life of this Agreement, upon reasonable notice to Respondent(s) and during normal business hours. If the Department believes that this Agreement or any portion of it has been violated, it will so notify the appropriate Respondent(s) and their respective counsel, as set forth in Paragraph 34 below, in writing, and it will attempt to resolve the issue or issues in good faith. If the Department is unable to reach a satisfactory resolution of the issue or issues raised within thirty (30) days of the date it provides written notice to the Respondent(s), it may elect in its sole discretion to either:
(i) institute a civil action in federal district court seeking to enforce the terms of this Agreement; or
(ii) notify the Respondents that the Agreement is no longer operative and reopen its investigation of Department of Justice Complaints #202-12C-153 and 22-18-119 and 202-35-55 and/or commence litigation under title III of the ADA in federal district court.24. Each Respondent shall provide an annual written report that identifies the number of shuttlebuses purchased or leased in the preceding fiscal year, and identifies for each shuttlebus whether it is a Smaller or Larger Vehicle, and whether it is Accessible. The report shall also identify how many Accessible Vehicles are operating at each Corporate-Owned Location, and shall describe the training that has taken place pursuant to Paragraph 20 above. The first report shall be due on October 1, 2004. The annual report shall be hand delivered or faxed to Department as set forth in the Notices provision below. If the Department fails to receive the annual report required by this paragraph on or before the date the report is due, it may so notify Respondent(s). If the Respondent(s) then fails to provide the required annual report within thirty (30) days of the date of such notice, Respondent(s) shall be in default of this Agreement and the Department, in its discretion, may so notify Respondent(s) of such default(s) pursuant to the provisions set forth in Paragraph 23 above.
25. Failure by the Department to enforce this entire Agreement or any provision thereof with regard to any deadline or any other provision herein shall not be construed as a waiver of its right to do so with regard to other deadlines and provisions of this Agreement.
26. This Agreement is a public document. A copy of this document or any information contained herein may be made available to any person. The Respondents or the Department shall provide a copy of this Agreement to any person upon request.
27. The obligations set forth in this Agreement are regulatory in nature pursuant to the authority of the Department of Justice to enforce title III of the ADA, as set forth in Paragraph 1 above. By entering into this Agreement, Respondents agree that the underlying obligations set forth in this Agreement may not be discharged in any subsequent bankruptcy proceeding concerning any Respondent.
28. This Agreement has been approved by the United States Bankruptcy Court for the District of Delaware. It shall become effective as of the date of the last signature below (the “Effective Date”) and shall expire on the date that is six (6) years from the Effective Date.
29. This Agreement shall be binding on each Respondent and its respective successors, transferees and assigns. Each Respondent shall notify all such successors, transferees, and assigns of the binding nature of the obligations set forth in this Agreement. Facsimiles of signatures shall constitute acceptable, binding signatures for purposes of this Agreement.
30. This Agreement constitutes the entire agreement between the parties on the matters raised herein, and no other statement, promise, or agreement, either written or oral, made by either party or agents of either party, that is not contained in this written Agreement shall be enforceable. This Agreement may not be modified or amended except by written consent of all parties.
31. This Agreement does not purport to remedy any other violations of the ADA or any other federal law other than those specifically addressed herein. This Agreement does not affect the continuing responsibility of the Respondents to comply with all aspects of the ADA.
32. This Agreement may be executed in counterparts, each of which constitutes an original and all of which constitute one and the same agreement.
33. An individual signing this Agreement on behalf of a Respondent represents and warrants to the Department that he or she has been authorized by such entity to execute this Agreement and that all requisite corporate and other approvals necessary to bind such entity have been obtained.
34. All notices, reports, or other such documents required by this Agreement shall be sent to the parties by fax or by hand delivery at the following addresses or to such other person as the parties may designate in writing in the future:For notices to the Department:
John L. Wodatch, Chief
Attention: Amanda Maisels
Disability Rights Section
Civil Rights Division
U.S. Department of Justice
1425 New York Avenue, NW
Washington D.C. 20005
(202) 307-2891
(202) 305-9775 (facsimile)
For notices to ANC, Alamo, and National:
Scott Lieberman
Vice President, Deputy General Counsel
200 S. Andrews Ave., Ninth Floor
Fort Lauderdale, FL 33301
(954) 320-4152
(954) 320-6011 (facsimile)
With copies to:
Todd Bromberg, Esq.
Wiley Rein & Fielding L.L.P.
1776 K Street, NW
Washington, D.C. 20006
(202) 719-7357
(202) 719-7207 (facsimile)
For notices to CAR Acquisition Company:
CAR Acquisition Company LLC
c/o Cerberus Capital Management, L.P.
450 Park Avenue
New York, New York 10022
Attn: Lenard B. Tessler
(212) 755-3009 (facsimile)
With copies to:
Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
Attn: Stuart D. Freedman
(212) 593-595535. Car Acquisition Company LLC executes this document in its capacity as Purchaser pursuant to that certain Asset Purchase Agreement dated June 12, 2003, by and among ANC Rental Corporation, et. al., and Car Acquisition Company LLC and Cerberus Capital Management, L.P. Notwithstanding the limitations set forth in Sections 2.3 and 2.4 of the Asset Purchase Agreement, Car Acquisition Company LLC (hereinafter, Purchaser) agrees that, as of the date of Closing under the Asset Purchase Agreement, this Settlement Agreement shall be binding upon Purchaser and its successors and assigns, and shall remain binding upon Alamo and National and the new Alamo and National entities owned or purchased by Purchaser (Alamo Rental (US) Inc. and National Rental (US) Inc., respectively), and their respective successors and assigns, if any.
COUNSEL FOR THE UNITED STATES:
Dated: ____________________
R. ALEXANDER ACOSTA
Assistant Attorney General
Civil Rights Division
JOHN L. WODATCH
Chief
ALLISON NICHOL
Deputy Chief
______________________________
AMANDA MAISELS
202-305-8454
ANNE MARIE PECHT
202-307-2891
Trial Attorneys
Civil Rights Division/Disability Rights Section
WENDY TIEN
Trial Attorney
Civil Division/Commercial Litigation
U.S. Department of Justice
950 Pennsylvania Avenue, NW
Washington, D.C. 20530
202-305-9775 (fax)
FOR ANC RENTAL CORPORATION
Dated: ____________________
______________________________
SCOTT LIEBERMAN
Vice President, Deputy General Counsel
200 S. Andrews Ave., Ninth Floor
Fort Lauderdale, FL 33301
954-320-4152
954-320-6011 (fax)
FOR ALAMO RENT-A-CAR, LLC
Dated: ____________________
______________________________
SCOTT LIEBERMAN
Vice President, Deputy General Counsel
200 S. Andrews Ave., Ninth Floor
Fort Lauderdale, FL 33301
954-320-4152
954-320-6011 (fax)
FOR NATIONAL CAR RENTAL SYSTEM, INC.
Dated: ____________________
______________________________
SCOTT LIEBERMAN
Vice President, Deputy General Counsel
200 S. Andrews Ave., Ninth Floor
Fort Lauderdale, FL 33301
954-320-4152
954-320-6011 (fax)
FOR CAR ACQUISITION COMPANY LLC
Dated: ____________________
______________________________
LENARD B. TESSLER
Authorized Signatory
c/o Cerberus Capital Management, L.P.
450 Park Avenue
New York, New York 10022
(212) 755-3009 (fax)
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October 14, 2003