Opinion · Court of Appeals for the Ninth Circuit
Charas v. Trans World Airlines, Inc.
160 F.3d 1259
- Type
- Opinion
- Court
- Court of Appeals for the Ninth Circuit
- Jurisdiction
- Federal
- Date
- 1998-11-30
- Topic
- general
holding that the Airline Deregulation Act does not preempt "run-of-the-mill personal injury claims" against airlines | holding that "service” refers to "such things as the frequency and scheduling of transportation” and "the selection of markets,” but not "the pushing of baggage carts, keeping the aisles clear ..., the safe handling and storage of luggage, [or] assistance to passengers in need” | stating that to “interpret service more broadly is to ignore the context of its use; and it effectively would result in the preemption of virtually everything an airline does.” | noting that when Congress enacted the ADA it "intended to preempt only state laws and lawsuits that would adversely affect the economic deregulation of the airlines and the forces of competition within the airline industry." | noting that when Congress enacted the ADA it “intended to preempt only state laws and lawsuits that would adversely affect the economic deregulation of the airlines and the forces of competition within the airline industry.” | noting that when Congress enacted the ADA it “intended to preempt only state laws and lawsuits that would adversely affect the economic deregulation of the airlines and the forces of competition within the airline industry.” | reading the preemption clause with the savings clause evidences congressional intent to prevent state regulation of airlines while preserving state tort remedies which do not significantly impact deregulation | defining "service” as "the prices, schedules, origins and destinations of the point-to-point transportation of passengers, cargo, or mail” but not "an airline’s provision of in-flight beverages, personal assistance to passengers, the handling of luggage, and similar amenities” | defining services to include point-to-point transportation of passengers, cargo, or mail | narrowly defining services as “the prices, schedules, origins and destinations of the point-to-point transportation of passengers, cargo, or mail” | insurance requirement would be “pointless” unless some state tort actions survived enactment of the ADA | "Congress ... intended to insulate the industry from possible state economic regulation... [i]t did not intend to immunize the airlines from liability for personal injuries caused by their tortious conduct." | “[T]hat Congress did not intend [for the ADA] to preempt all state tort claims is evident from [the fact that] . . . airlines are still required to maintain insurance . . . .”
Citator
- Cited by
- 66 opinions
Stuart J. Starry, Frank, Woodfill, Lucas Pressler, LLP, Houston, Texas, for appellants Charas, Jacoby, Beverage, and Newman.
Stuart J. Starry (argued), Frank, Woodfill, Lucas Pressler, LLP, Houston, Texas, Michael S. Danko (on the brief), O'Reilly, Collins Danko, Menlo Park, California, for appellant Beverage.
Bonnie R. Cohen and Kymberly E. Speer, Nelsen, Greenberg Cohen, San Francisco, California, for appellees Trans World Airlines, Inc., American Airlines, and Continental Airlines.
Donna H. Kalama, Goodsill, Anderson, Quinn Stifel, Honolulu, Hawaii, on the briefs for appellee Trans World Airlines.
Harry Carter, Higgs, Fletcher, and Mack, San Diego, California, arguing for appellee American Airlines.
Appeal from the United States District Court for the District of Hawaii Helen Gillmor, District Judge, Presiding D.C. No. CV-94-00963-HG/FIY.
Appeal from the United States District Court for the Northern District of California D. Lowell Jensen, District Judge, Presiding D.C. No. CV-93-04044-DLJ.
Appeal from the United States District Court for the Southern District of California Napoleon A. Jones, District Judge, Presiding D.C. No. CV-95-02530-NAJ.
Appeal from the United States District Court for the Northern District of California;Page 1261D. Lowell Jensen, District Judge, Presiding D.C. No. CV-96-03253-DLJ.
[3]
[9] Gulley brought a state negligence action against American. The district court held that although Gulley's claim for negligent failure to provide safe equipment involvedPage 1262the "maintenance and operation" of the aircraft and was not preempted, Gulley's claim for negligent failure to assist her down the stairs involved the rendering of "service" and was preempted by the ADA. Gulley appealed the district court's order granting American's motion for summary judgment.
[11] Prior to obtaining the required certificate, Newman was not permitted to board and was required to stay overnight at a motel. She filed various claims, including state tort claims and federal statutory claims, against American. The district court granted American's motion for summary judgment, concluding that Newman's state law claims were preempted by the ADA and that American had "permissibly refused" boarding to Newman for the purposes of her federal claims. Newman timely appealed.
[N]o State or political subdivision thereof and no interstate agency or other political agency of two or more States shall enact or enforce any law, rule, regulation, standard, or other provision having the force and effect of law relating to the rates, routes, or service of any air carrier. . . .
[13] 49 U.S.C. app. § 1305(a)(1).2
[14] Prior to 1978, the Civil Aeronautics Board had economic regulatory authority over interstate air transportation pursuant to the Federal Aviation Act of 1958,72 Stat. 731, as amended, 49 U.S.C. app. § 1301 et seq. However, the Act did not expressly preempt state regulation, and further, it contained a "savings clause" providing that "[n]othing . . . in this chapter shall in any way abridge or alter the remedies now existing at common law or by statute, but the provisions of this chapter are in addition to such remedies." 49 U.S.C. app. § 1506 (recodified at49 U.S.C. § 40120(c)); see American Airlines, Inc. v. Wolens,513 U.S. 219,222(1995). As a result, states were not prevented from enforcing their own laws, despite the economic effect on the airlines. See California v. CAB,581 F.2d 954,956(D.C. Cir. 1978) (holding that states were permitted to regulate intrastate airfares); Nader v. Allegheny Airlines, Inc.,426 U.S. 290,300-01(1976) (allowing states to enforce their own laws barring deceptive trade practices).
[15] In 1978, Congress determined that efficiency, low prices, variety, and quality would be furthered by reliance on competitive market forces rather than pervasive federal regulation. See H.R. Conf. Rep. No. 95-1779, 95th Cong., 2d Sess. 53 (1978). To prevent states from "undo[ing] federal deregulation with regulation of their own," Morales v. Trans World Airlines,504 U.S. 374,378(1992), Congress enacted § 1305(a)(1) which preempts statePage 1263laws "relating to the rates, routes, or service of any air carrier. . . ."
[16] However, the scope of this preemption has been a source of considerable dispute since its enactment. In our own circuit, we have addressed the issue on several occasions. Prior to Harris, we held that the ADA did not preempt state law tort claims that were only "tenuously connected" with airline deregulation. See Lathigra v. British Airways PLC,41 F.3d 535,540(9th Cir. 1994) (looking to congressional intent, the panel concluded that the ADA did not preempt state tort actions for negligent reconfirmation because they did not undermine the goals of airline deregulation.); West v. Northwest Airlines, Inc.,995 F.2d 148,151(9th Cir. 1993) (holding that state law tort claim for compensatory damages was "too tenuously connected to airline regulation to trigger preemption under the ADA").
[17] However, in 1995, we took a different approach. Harris brought a tort suit against American Airlines for continuing to serve alcohol to an intoxicated passenger who was harassing her. In declining to look beyond the bare preemption language to congressional intent, the majority, over Judge Norris's dissent, concluded that the ADA preempted Harris's claim because it "relate[d] to [a] service" that the airline rendered, namely the provision of a drink. Harris,55 F.3d at 1476. The panel did not discuss or distinguish West or Lathigra.
[18] Two years later, we wrestled with this problem again in Gee. There, we expressed doubts about Harris and the validity of its analysis. See Gee,110 F.3d at 1404-05. However, in an attempt to mitigate the impact of Harris, we expressly adopted the Fifth Circuit's approach in Hodges v. Delta Airlines, Inc.,44 F.3d 334(5th Cir. 1995) (en banc). See Gee,110 F.3d at 1407. Under Hodges, claims related to an airline's "operations and maintenance" are not preempted by the ADA while claims related to a "service" provided by the airline are preempted. Hodges,44 F.3d at 336-37. As Judges O'Scannlain and Jolly predicted in their respective concurrences in Gee and Hodges, the distinction between an airline's operations and its service turned out to be as elusive as it is unworkable.3
[19] [1] Judge O'Scannlain noted that the operations-versus service dichotomy invites nonsensical, inequitable, and inconsistent results, and in any event has nothing to do with the purpose of airline deregulation. See Gee,110 F.3d at 1410. For example, under the rule announced in Gee, a plaintiff injured when struck by a beverage cart door would be able to bring a tort action if the door swung open because a bolt was missing (because the injury arises out of the "operations and maintenance" of the aircraft), but not if the flight attendant negligently failed to latch the door properly (because the flight attendant's conduct relates to "service"). Judge O'Scannlain demonstrated the folly of the distinction between "operations and maintenance" and "service," and suggested instead that the court examine whether the state laws underlying the claims frustrate the goal of economic deregulation by interfering with the forces of competition. See id. (O'Scannlain, J., concurring). If they do, the claims would be preempted; otherwise, they would not.
[20] In reconsidering our view of the scope of the ADA's preemption, we conclude that Judge Norris and Judge O'Scannlain got it right and that Harris is contrary to congressional intent. Further, although we recognize that we were bound by Harris when we decided Gee, we now believe that the rule we adopted in Gee was imprecise, difficult to apply, and inadequately reflective of the ADA's goal of economic deregulation. Accordingly, in defining the "service" that the ADA preempts, we adopt Judge O'Scannlain's approach, an approach consistent with Supreme Court precedent and the ADA's plain language and legislative history.
Restrictions on advertising serv[e] to increase the difficulty of discovering the lowest cost seller . . . and [reduce] the incentive to price competitively. . . . [p]rice advertising surely `relates to' price.
[22] Morales,504 U.S. at 388-89(internal citations and quotations omitted). As such, the Court held that state actions based upon these laws had the "forbidden significant effect" on rates, routes, or service, and thus were preempted. Id. at 388. However, the Court explicitly limited its holding:
[W]e do not . . . set out on a road that leads to preemption of state laws against gambling and prostitution as applied to airlines . . . [s]ome state actions may affect [airline fares] in too tenuous, remote, or peripheral a manner to have pre-emptive effect.
[23] Id. at 390 (internal citations and quotations omitted).
[24] Likewise, in Wolens, the Court recognized the boundaries of § 1305(a)(1). In Wolens, the Court concluded that plaintiffs' claims for breach of contract, stemming from the airline's unilateral decision to devalue plaintiffs' frequent flier miles were not preempted. See Wolens,513 U.S. at 222. In so doing, the Court held that Congress did not intend to preempt common law contract claims. And, although the majority did not specifically address whether personal injury claims would be preempted, both concurring opinions did. Justice O'Connor opined:
Many cases decided since Morales have allowed personal injury claims to proceed, even though none has said that a State is not "enforcing" its "law" when it imposes tort liability on an airline. In those cases, courts have found the particular tort claims at issue not to "relate" to airline "services," much as we suggested in Morales that state laws against gambling and prostitution would be too tenuously related to airline services to be preempted.
[25] Id. at 242 (O'Connor, J., concurring in part and dissenting in part) (internal citations omitted).4Further, Justice Stevens noted:
In my opinion, private tort actions based on common-law negligence or fraud . . . are not pre-empted . . . . Presumably, if an airline were negligent in a way that somehow affected its rates, routes, or services . . . the majority would not hold all common-law negligence rules to be pre-empted by the ADA.
[26] Id. at 235-36 (Stevens, J., concurring in part and dissenting in part).
[27] Although Morales and Wolens do not directly resolve whether the § 1305(a)(1) preemption encompasses state law tort claims, they certainly suggest that such claims are not within the intended reach of the preemption.
two presumptions about the nature of preemption. First, because the States are independent sovereigns in our federal system, [the Supreme Court has] long presumed that Congress does not cavalierly pre-empt state-law causes of action . . . . Second, [the] analysis of the scope of the statute's pre-emption is guided by [the Court's] oft-repeated comment . . . that the purpose of Congress is the ultimate touchstone in every pre-emption case.
[29] Medtronic,518 U.S. at 485(internal citations and quotations omitted). Moreover,
[I]n all pre-emption cases, and particularly in those in which Congress has legislated . . . in a field which the States have traditionally occupied, . . . [the court must] start with the assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.
[30] Id. (internal citations and quotations omitted).
[31] [2] It is evident that Congress's "clear and manifest purpose" in enacting the ADA was to achieve just that — the economic deregulation of the airline industry. Specifically, "the ADA . . . was designed to promote `maximum reliance on competitive market forces.'" Wolens,513 U.S. at 230(citing 49 U.S.C. app. § 1302(a)(4)). The purpose of preemption is to avoid state interference with federal deregulation. See id. Nothing in the Act itself, or its legislative history, indicates that Congress had a "clear and manifest purpose" to displace state tort law in actions that do not affect deregulation in more than a "peripheral manner." See Morales,504 U.S. at 390. Further, that Congress did not intend § 1305(a)(1) to preempt all state tort claims is evident from at least two other provisions of the airline regulatory statutes. First, airlines are still required to maintain insurance that covers "amounts for which . . . air carriers may become liable for bodily injuries to or the death of any person. . . ." 49 U.S.C. app. § 1371(q) (recodified as49 U.S.C. § 41112(a)). Complete preemption of state law in this arena would have rendered pointless this requirement for insurance coverage. Second, the savings clause, § 1506, which provides that "[n]othing . . . in this chapter shall in any way abridge or alter the remedies now existing at common law . . .," read together with the preemption clause, evidences congressional intent to prohibit states from regulating the airlines while preserving state tort remedies that already existed at common law, providing that such remedies do not significantly impact federal deregulation. 49 U.S.C. app. § 1506 (recodified as49 U.S.C. § 40120); see also Morales,504 U.S. at 378.
[32] Understanding the objective of this legislation is critical to interpreting the extent of its preemption. In a recent case involving the interpretation and preemptive reach of the phrase "relates to" under ERISA, the Supreme Court explained that courts must examine" `the objectives of the ERISA statute as a guide to the scope of the state law that Congress understood would survive,' as well as to the nature of the effect of the state law on ERISA plans." California Div. of Labor Standards Enforcement v. Dillingham Constr., N.A., Inc.,117 S. Ct. 832(1997) (quoting and citing New York State Conference of Blue Cross Blue Shield Plans v. Travelers Ins. Co.,514 U.S. 645,656(1995)). The Supreme Court has twice looked to its interpretation of ERISA as an aid in interpreting the preemptive language of the ADA. Wolens,513 U.S. at 223; Morales,504 U.S. at 383-84.
[33] [3] In its decisions interpreting § 1305(a)(1), the Supreme Court has not had occasion to define the term "service." In attempting to deduce its meaning, we are mindful that principles of statutory construction require us to consider the term within its context. See Pension Benefit Guar. Corp. v. Carter Tillery Enters.,133 F.3d 1183,1186(9th Cir. 1998). Airlines' "rates" and "routes" generally refer to the point-to-point transport of passengers. "Rates" indicates price; "routes" refers to courses of travel. It therefore follows that "service," when juxtaposed to "rates" and "routes," refers to such things as the frequency and scheduling ofPage 1266transportation, and to the selection of markets to or from which transportation is provided (as in, "This airline provides service from Tucson to New York twice a day.") To interpret "service" more broadly is to ignore the context of its use; and, it effectively would result in the preemption of virtually everything an airline does. It seems clear to us that that is not what Congress intended.
[34] [4] Nowhere in the legislative history, or in what remains of the federal airline regulatory statutes, does Congress intimate that "service," in the context of deregulation, includes the dispensing of food and drinks, flight attendant assistance, or the like.
[36] REMANDED TO THE PANEL.
[38] In five separate actions, appellant Cherie Charas and others brought state-law tort actions against appellee Trans World Airlines, Inc. and other air carriers. The claims were by passengers of the defendants, and were all based on the allegedly negligent or otherwise tortious conduct of airline employees aboard aircraft or associated equipment. In each case, the district court concluded that the claims were preempted by § 1305(a)(1) of the ADA. Section 1305(a)(1) expressly preempts state laws "relating to the rates, routes, or service" of air carriers.
[39] Charas and the other passengers appealed. Sua sponte, the court of appeals took the appeal en banc before the three-judge panel to which the case had been assigned rendered a decision.
[40] [1] Courts must examine whether state laws underlying claims frustrate the goal of economic deregulation by interfering with the forces of competition. If they do, the claims will be preempted; otherwise, they will not.
[41] [2] Congress's purpose in enacting the ADA was to achieve the economic deregulation of the airline industry. The purpose of preemption is to avoid state interference with federal deregulation. Nothing in the ADA or its legislative history indicates that Congress had a clear and manifest purpose to displace state law in actions that do not affect deregulation in more than a peripheral manner.
[42] [3] Airlines' "rates" and "routes" generally refer to the point-to-point transport of passengers. "Rates" indicates price; "routes" refers to courses of travel. When juxtaposed to "rates" and "routes," "service" therefore refers to such things as frequency and scheduling of transportation, and to the selection of markets to or from which transportation is provided. To interpret "service" more broadly is to ignore the context of its use; it would effectively result in the preemption of virtually everything an airline does. That was not what Congress intended.
[43] [4] Nowhere in the legislative history or in airline regulatory statutes did Congress intimate that in the context of deregulation, "service" included the dispensing of drinks, flight attendant assistance, or the like. [5] When Congress enacted federal deregulation of the airlines, it did not intend to immunize them from liability for personal injuries caused by their tortious conduct. Congress used "service" in § 1305(a)(1) in the public utility sense, i.e., the provision of air transportation to and from various markets. In that context, "service" does not refer to pushing beverage carts, keeping the aisles clear of stumbling blocks, safe handling and storage of luggage, assistance to passengers in need, or like functions.Page 358
- Because of the need to clarify the law in this area, these cases were taken en banc after they were assigned to a three-judge panel, but prior to the panel's rendering a decision. ↩
- In 1994, section 1305(a)(1) was amended and incorporated into the Federal Aviation Administration Authorization Act of 1994 ("FAAAA"),49 U.S.C. § 41713(b), to prohibit the enforcement of any state law "related to price, route, or service of an air carrier." ↩
- In his concurrence, Judge Jolly opined that:
The fact that the majority and the dissent disagree only on the application of this principle reveals that it promises uncertainty and inconsistent results. . . . I would prefer, instead of erecting these tenuous and uncertain judge-made distinctions, to rely upon the plain language of the provision. . . .
Hodges,44 F.3d at 340,342. ↩ - In their criticism of her "total preemption" approach, the majority implicitly agreed with Justice O'Connor's conclusion that personal injury claims are not preempted by the ADA. See Wolens,513 U.S. at 234, n. 9. ↩
- Our analysis of the preemption question does not touch any federal claims brought by plaintiff-appellants in these cases. The merits of all the claims in issue, federal and state, are left to the panel. ↩