Don't expect a ceremony at Ellis Island, but airline Virgin America got welcome news today that it remains a U.S. citizen.
The finding by the Department of Transportation means the airline can continue to operate as a U.S. airline and fly between domestic markets.
"They are extraordinarily pleased to lift the citizenship cloud that has been hanging over them," said Virgin outside counsel Kenneth Quinn, a partner in the Washington office of Pillsbury Winthrop Shaw Pittman. “It’s great to have a victory, and to allow this fabulous airline to provide much-needed competition.”
In August 2007, DOT first certified the airline’s U.S. citizenship. That means at least 75 percent of an air carrier’s voting stock must be owned or controlled by U.S. citizens, the president and at least two-thirds of the board of directors and managing officers must be U.S. citizens, and the air carrier must be under the actual control of U.S. citizens.
But after a significant potential shift in its shareholder makeup, Virgin notified the department, prompting the review.
Both Alaska Airlines and the Aircraft Mechanics Fraternal Association also petitioned DOT for a public review of Virgin’s citizenship. The petitions were dismissed today.
In addition to Quinn, Pillsbury partner Jennifer Trock and associate Timothy Gerheim worked on the case, which was overseen by Virgin general counsel David Pflieger.
Virgin agreed to provisions to ensure that new investments of capital from entities other than the Virgin Group – a collection of the United Kingdom companies and/or citizens that own 25 percent of the air carrier’s stock – will be obtained. Virgin America also will add an additional U.S. citizen to its board, resulting in seven U.S. citizen investor designees as voting members on the nine-member board.