U.S. Supreme Court Grants Certiorari on Significant Aviation Issues

by Holland & Knight LLP

This spring, the U.S. Supreme Court granted certiorari to review two decisions that significantly affect the aviation industry, namely airline immunity under the Aviation and Transportation Security Act (ATSA) and preemption under the Airline Deregulation Act (ADA). Such review may result in reversal of the controversial decisions discussed below and provide much-needed guidance to the lower courts in these areas. Both cases will be argued during the October 2013 Term, with decisions expected in 2014.

Air Wisconsin Corp. v. Hoeper, No. 12-315

On June 17, 2013, the Court granted certiorari to review a defamation case involving application of the immunity provision in the Aviation and Transportation Security Act (ATSA). The ATSA, enacted after the terrorist attacks of September 11, 2001, is responsible for various measures to strengthen our national security system, including the creation of the Transportation Security Administration (TSA). Significantly, the ATSA recognizes that airline employees are often the first to receive and report information regarding potential security threats. In addition to requiring airlines to promptly report potential threats to TSA, the ATSA grants airlines and their employees broad immunity from liability subject to the narrow exception where the statements are made "with actual knowledge that the disclosure was false, inaccurate, or misleading" or "with reckless disregard as to the truth or falsity of that disclosure."1

In the Air Wisconsin case, the airline had reported its concerns about the air travel of a soon-to-be-terminated pilot who, during the his fourth proficiency test, exhibited irrational behavior and directed angry outbursts at his instructor. Importantly, the pilot was a Federal Flight Deck Officer (FFDO), which means he was authorized to carry a TSA-issued firearm. An Air Wisconsin manager with knowledge of the pilot's behavior communicated to the TSA that the pilot was about to travel and had been terminated that day, that there were concerns about his mental stability and that, as an FFDO, he might be armed. The pilot sued Air Wisconsin for defamation and was awarded $1.4 million in a jury verdict.

The Colorado Court of Appeals affirmed the verdict, and the Colorado Supreme Court, in a sharply divided 4-3 opinion, also affirmed. Holding that the issue of immunity was a question of law for the court, Colorado's high court determined that Air Wisconsin was not entitled to immunity under the ATSA because the manager should have used more precise wording in reporting the potential threat. A strongly worded dissent criticized the majority for holding that ATSA immunity is lost when a statement is made recklessly even though it is true, for making "hair-splitting distinctions" in the wording of the report that made no difference to TSA's analysis and for undermining the ATSA's objective in urging reporting of potential security threats.

The Supreme Court granted certiorari on the issue of whether a court may deny ATSA immunity without deciding whether the airline's report of suspicious conduct was materially false.

Northwest Airlines, Inc. v. Ginsberg, No. 12-462

On May 20, 2013, the Supreme Court granted certiorari to review a controversial preemption decision by the U.S. Court of Appeals for the Ninth Circuit, which held, in contrast to courts within and outside the Ninth Circuit, that the claim for breach of the implied covenant of good faith and fair dealing is a common law contract claim that is not preempted by the Airline Deregulation Act (ADA).2 In Ginsberg, a Northwest frequent flyer member sued the airline for negligent and intentional misrepresentation, breach of contract and breach of the implied covenant of good faith and fair dealing for his removal from the frequent flyer program, which, by its terms, permitted Northwest, in its "sole judgment," to do so.

Although the district court had dismissed the breach of contract claim for failure to state a claim and the misrepresentation and implied covenant claims as preempted by the ADA, the Ninth Circuit reversed as to the implied covenant claim (the only claim on appeal), finding that this claim was part of the contract laws of the states, and one that does not interfere with the deregulatory purpose of the ADA. The Ninth Circuit followed its prior, pre-Wolens decision in West v. Northwest Airlines,Inc., 995 F.2d 148 (9th Cir. 1993) where it held that the breach of the covenant of good faith and fair dealing was too tenuously connected to airline regulation to trigger preemption. Additionally, the circuit court rejected arguments that this implied common law claim impermissibly enlarges the contract's terms in contravention of the holding in American Airlines, Inc. v. Wolens,3 which expressly limits contract claims to those arising from the parties' "self-imposed undertakings."

The circuit court further held that the claim does not relate to the airline's "prices" and "services" and that the district court used an "overly broad" definition that would effectively subsume all breach of contract claims. This reasoning is at odds with Supreme Court precedent, notably the Wolens case, where the Court found claims arising from an airline's changes to its frequent flyer program related to an airline's services and prices. In addition, the Ninth Circuit has been criticized by the government and other circuits for continuing to follow a narrow definition of "services" as set forth in its much-outdated opinion, Charas v. Trans World Airlines, Inc.4

The Supreme Court granted certiorari on the issue of whether the Ninth Circuit erred in holding that the implied covenant of good faith and fair dealing was not preempted under the ADA because such claims are categorically unrelated to a price, route or service, notwithstanding that the claim arises out of a frequent-flyer program and manifestly enlarges the terms of the parties' contract


1 49 U.S.C. §44941(b).

2 49 U.S.C. §41713(b)(1). The ADA’s preemption clause provides: "[A] State, political subdivision of a State, or political authority of at least 2 States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of an air carrier."

3 513 U.S. 219 (1995).

4 160 F.3d 1259 (9th Cir. 1998). See Air Transport Assoc. of Am. v. Cuomo, 520 F.3d 218, 223 (2d Cir. 2008) (Charas' definition of services is inconsistent with Rowe, in which the Supreme Court "necessarily defined 'service' to extend beyond prices, schedules, origin, and destination"). In Nat'l Fed. of the Blind v. United Air Lines, No. C 10-04816, 2011 WL 1544525 (N.D. Cal. 2011), the U.S. Department of Transportation filed a Statement of Interest that expressly recognized that Charas' limited definition of services is “on unstable ground in the wake of Rowe, a point that has been recognized by judges both within this district and elsewhere." See also our prior articles reporting on this case: California District Court Requests Input From the U.S. and DOT in Preemption Issues Involving Automated Check-In Kiosks, Aviation Centerline, February 2011 at http://www.hklaw.com/publications/California-District-Court-Requests-Input-From-the-US-and-DOT-on-Preemption-Issues-Involving-Automated-Check-In-Kiosks-02-28-2011/; U.S. Files Statement of Interest in California District Court Litigation, Aviation Centerline, March/April 2011 at http://www.hklaw.com/publications/US-Files-Statement-of-Interest-in-California-District-Court-Litigation-Concerning-Preemption-Issues-Involving-Automated-Check-In-Kiosks-04-15-2011/.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Holland & Knight LLP | Attorney Advertising

Written by:

Holland & Knight LLP

Holland & Knight LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.