Petition for Writ of Certiorari — Rein v. Pan American World Airways, Inc.

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24 Supteme Coun, US

IN THE

Supreme Court of the United Sth, OF THE Gd

OCTOBER TERM, 1991

— ——

- | AUG 12 y9gp

DENICE H. REIN, et al.,

—_vV.—

PAN AMERICAN WORLD AIRWAYS INCORPORATED,

Petitioners,

Respondent.

DILIP JOSHI,

—_vV.—

PAN AMERICAN WORLD AIRWAYS INCORPORATED,

et ai.,

Petitioners,

Respondent.

PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

PETITION-FOR WRIT OF CERTIORARI

PLAINTIFFS’ STEERING COMMITTEE

Karachi Hijacking

Marc S. Moller

Lead Counsel

KREINDLER & KREINDLER

100 Park Avenue

New York, New York 10017

(212) 687-8181

Daniel C. Cathcart

Wm. Marshall Morgan

On the Petition:

Lee S. Kreindler

Marc S. Moller

Steven R. Pounian

James P. Kreindler

ai..c1 M. Kolko

PLAINTIFFS’ COMMITTEE

Lockerbie Disaster

Lee S. Kreindler

Chairman and Counsel of Record

KREINDLER & KREINDLER

100 Park Avenue

New York, New York 10017

(212) 687-8181

Michel F. Baumeister

Richard E. Brown

Stanley M. Chesley

Nicholas Gilman

Frank H. Granito, Jr.

QUESTIONS PRESENTED FOR REVIEW

Does the Warsaw Convention Treaty, despite its plain lan-

guage, create an exclusive cause of action, preempting state

statutory and common law?

Does the exclusion of punitive damages liability to passen-

gers, when their damage has been caused by an airline’s wil-

ful misconduct, violate the plain language of the Warsaw

Convention?

Does the Warsaw Convention, which is silent on the sub-

ject, deny well recognized state common law and statutory

law rights to punitive damages?

LIST OF PARTIES TO THE PROCEEDING*

° Rein v. Pan American World Airways (‘‘Lockerbie Disaster’’) The

following plaintiffs are parties to this proceeding: Denice H. Rein; John J.

Schultz; Rosanne Weston; Madeline Shapiro; John Frick Root; George H.

Williams and Helena A. Williams; Arnold Asrelsky and Hope Asrelsky;

Lynne R. Fraidowitz; Arnold Victor Butler; John B. Zwynenburg; Molena

A. Porter; Charles M. Rosenthal; Salvatore V. Capasso and Betty-Ann

Capasso; Dona B. Bainbridge; Judith A. Pagnucco; Raymond Jermyn, Sr.

and Margaret M. Jermyn; Mary M. Stratis; Kathryn G. Daniels; Mary Lou

Ciulla; Helen E. Hawkins; Shirin A. Vejdany; Maggie Boatman; Bernadette

R. Hurst; Lisa Platt; William W. Hollister; Peter Lowenstein; Elizabeth

Delude-Dix; Rose Mary Copeland; Sudhakar Dixit; Sudhakar Dixit; Larry

Forsthe; Donald Malicote, Jr.; Nazir Jaafer; Roosevelt Smith; Philip M.

DiMauro; Stephanie L. Bernstein; Luisa Della Ripa; Eleanor Hoey Bright;

Geraldine G. Buser; Paul Halsch; Geraldine Buser; Patricia L. Kingham;

Rhoda P. Miller; Jacob Posen and Bonnie J. Gregge; Leonard T. Rencevicz;

William H. Johnson and Grace Johnson; M.T. Ergin; Robert Leckburg;

Anthony B. Hall and Philippa W.M. Hall; Robert Leckburg; Florence Bis-

sett; John Draheim; William J. Marek; Pamela K. Akerstrom; Ivy Ng

Trimmer-Smith; Shachi Rattan; David Bell; Daniel Edward Cohen and

Susan H. Cohen; Palmer N. Smith; Anne Hudson; Florencio Quiguyan;

Tammy B. Chenoweth; Faith Pescatore; Melvin Bell; Leonard Colasanti and

Joanne Colasanti; Margaret C. Coursey; Robert L. Coursey and Scott E.

Coursey; Eugene A. Saraceni; Marilyn Swan; Meryl Shahun Rosen; Rose-

mary Mild and James K. Wolfe; Lynn K. Garczynski; Terry F. Gould; Glenn

P. Johnson; Phillip B. Bergstrom; Felix Teran; Peter. M. McCarthy; Allen

Benello; William M. Pitt and Sallie H. Pitt; Susan E. Walker; John Flynn;

Yvonne Reeves; Anthony J. Cardwell and Barbara A. Cardwell; Lucille Ben-

field; Edmundo L. Caffarone and Graciela Caffarone; Barbara W. Lieber-

man; George W. Wilson and Kate B. Wilson; Alan M. Davis; Marina M.

Kulukundis; Elaine C. Wright; Jane E. Davis; John M. Cory; Velma Jean

McGuire; Larry B. Gibson; Barbara Richardson; Michael A. Scott; Eileen T.

O’Connor; Thomas Fonteller; Judith Papadopoulos; Susan M. Kosmowski;

George L. Sheanshang; Anne H. Gillis; Michael J. Doyle; Barbara M.

Weedon; Franziska Schauble; Ellen M. Lariviere; Patricia A. Martin;

Harshida Schroff; Raquel L. Benvenuto; Patricia J.S. Simpson; Barbara A.

Ahern and Thomas A. Ahern; Siobhan D. Mulroy; Dierdre T. Fortune; John

C. Parker; Thomas E. Dater; Carolyn Ammerman; Vera Young; Carol!

McCollum; Perry Dornstein; Leo Cawley; William G. Atkinson; Suzanne

Martin; Alf Corner and Pauline Corner; Joan C. Smith and Edward F.

Smith; Diana Browner; Michael Woolf Tager; Rita Kelly; Catherine Sigal;

Oregon Rogers; Glendon L. Rafferty; Michael Waido; Tatiana Guevorguian;

Ervin Phillips; Wendy A. Giebler; Patricia A. Brunner; Marion K. Alder-

man; Marion K. Alderman; Beverly Braniff Jeck; Sandra B. Clarren; Fran-

coise Boyer; Everett Woods and Ollie Woods; Vera van Tienhoven; Tadashi

ill

Tanaka and Emi Tanaka; Kenneth S. Barclay; Marjorie G. McKee; Walter

G. Morson; Aphrodite Tsairis; John Boland and Jane Boland; Loulie

Canady; Susan G. Bennett; William Hudson; Sharda Bhatia.

Joshi v. Pan American World Airways (‘‘Karachi Hijacking’’) The follow-

ing plaintiffs are parties to this proceeding: Dilip Joshi; Nadya Hussain and

Tahira Lodhi; Dilip Parikh; Faraidoon Oshtory; Deepak C. Mehra; Pretty

George and George Mathai; Avani B. Shah, Rupal B. Shah and Bipin M.

Shah; Preeti Bhuva, Harshad Bhuva, Urjita Parekh, Bharat Parekh, Dwijal

Dave and Khitendra Dave; Ajay Patel and Parvati Patel; Manjula S. Patel,

Mehul Patel, Sangita Patel and Nikita Pital; Mahendra R. Patel and Rekha

P. Kumar; Siddartha Reddy and Asha Rikddy; Sumit Bhandari; Heena

Parikh; Urmila Parikh; Nilima Shah; Catherine Dumas; Shakuntala P. San-

chala; Jyotsna Bhandari; Sharon Bhandari; Yashwant S. Bhandari; San-

danand Singh, Samir Singh, and Kala Singh; Dorothy Peddi; Fareena Sultan

Ahmed; Kyshore Murthy; Savithri Bhat; Aisha Begum and Mehboob Khan;

Sanjay Patel and C.N. Patel; Bakul Shah and Vasanti Shah; Hara Gopal,

Hadi Ali Rizvi, Mrs. Hadi Ali Rizvi, Nigar Zehra Rizvi, Farhana Rizvi,

Hansa Merchant, Kankuben Gala, Jaswantiben Shah, Raksha Harshadral

Shah, Pratik Shah, Jignisha H. Shah, Harshad Shah, Mrs. Farhat Hussain,

Nabihah Y. Hussain, Hammed Hussain, Armish Bhaett, Jayaben R.

Sanghani, Mrs. Jayaben Sanghani, Jay Grantier, M. Jayed, R.A. Hamed,

Malik Netrakanti, Imram Ali and Khadiya Ali; Gayatri Dave, Gargi Dave

and Vinod Dave; Shekhar Mitra and Anuradha Mitra; Nayan Pancholi;

Shainaz Bhatia Gulamani, Bahikdaban Bhatia and Fatima Bhatia; Aarif

Gulamani, Kabir Gulamani and Jubilee Gulamani, Paraq Sheth, Father

Anthony Theordore, Said Faiz Kidwai, Suhail Qanar and Madhukanta Patel;

Vishal Patel and Kirtjkunar Dhayabhai Patel; Parita Patel; Ranjaben Patel,

Jayshreeber Patel and Pravin Patel; Jasmine Asher and Arun Asher; Khan-

jan Dalal, Kalpesh Dalal, Kalpana Shah, Deepali Desai, Mehul Shith, Utpala

Desai, Milind Sharad Desai, Narendra R. Desai and Swati M. Desai; Urmi

Parikh, Shilpa Patel and Priti Shah; Mukul Vaingankar, Michael Goldstein,

Gloria Goldstein, Kumar Kulkarni and Arshad Faruqui; Hardayal Mehta,

Anjna Mehta and Kanak Mehta; Krishnaveni Thanikaimoni, Ravindran

Thanikaimoni and Kirthana Thanikaimoni; Zeba Hamid, Kamran Hamid,

Jazia Hamid and Syed Hamid; Nagin Patel, Tara Patel, Satish Patel, Nathu-

bai Patel, Govind Patel, Chotubhai Patel, Jamna Patel and Ganga Patel; Dr.

Ramesh V. Bhat; Pancha Darji; Mazherullah Baig, Khalidia Baig, Shrikant

Patel, Shatel Patel, Hara Gopal, Kusum Naik, Harshad Shah, Mohammed

Hussain, Madhavdas Merchant, Roberto Munoz Flores, Delfina Roque de

Munoz, Francisco Javier Munoz, Micaela de Munoz, Ricardo de Munoz,

Mariana de Munoz, Oralia Garcia de Alvarez, Amicuta de Alvarez, Amelia

de Alvarez, Elisa de Alvarez, Jose Antonio de Alvarez, Oralia de Alvarez,

Norma de Alvarez, Jonathan de Alvarez and Julio Caesar de Alvarez; Rajiv

Thakkar; Vinod Dave and Niranjana Dave; Gautam Dasgupta, Antusa

Dasgupta, Anisha Dasgupta and Denali Dasgupta; Kusum Naik, Shrinivas

Naik, Shirish R. Naik, Sameer R. Naik and Seema Naik; Susan Kurian;

Tahira Khalid; Vallabhbhai T. Sanchala; Amrutla! Darji; Meenu Sundareson

and Shanker Sundareson; Anna Kurumthottathil, Bennett Kurumthottathil

and Bibil Kurumthottathil; Bashir Amin; Naseeruddin Mahnrood; John T.

Harper; Shaily J. Raval; Mona Patel; Edessaryvalapp Unnikrishnan and

Usha Unnikrishnan; Indira M. Popat, Mulraj Popat, Anu R. Thakkar and

Saroj Ruparel; Hansa Joshi.

The defendant is Pan American World Airways, Inc.

TABLE OF CONTENTS

QUESTIONS PRESENTED FOR REVIEW...

LIST OF PARTIES TO THE PROCEEDING

py 3 Be es oo |: Se

SUMMARY OF ARGUMENT ..............

* PAGE

“eee eree

I. CERTIORARI SHOULD BE GRANTED TO

RESOLVE A CONFLICT BETWEEN THE

CIRCUITS ON WHETHER THE WARSAW

CONVENTION TREATY PROVIDES AN

EXCLUSIVE CAUSE OF ACTION, AND TO

OVERRULE AN INTERPRETATION OF

THE TREATY IN CONFLICT WITH ITS

PLAIN LANGUAGE AND CONTRARY TO

ACCEPTED PREEEMPTION ANALYSIS...

A. The holding of exclusivity and preemption

was central to the dismissal, below, of the

punitive damages claims.................

B. The holding of exclusivity and preemption

has wide-ranging consequences in Warsaw

COUN GOD 6 ood ccevecdcsncncvaccwess

Il.

PAGE

The holding of exclusivity and preemption

conflicts with holdings of the Ninth Cir-

cuit, the highest court of one state, and

Nt ih titre Wid sib 000646 Osea akew

The holding of exclusivity and preemption

is contrary to the plain language of the

WON CRUIUUIIIOD 6c ccccdccccccvcvcces

The holding of exclusivity and preemption

is contrary to the views of leading com-

DCCL toe noeeaueemes eo eon ee ane ss

The holding of exclusivity and preemption

conflicts with the Convention’s direction to

leave damages to local law..............

. The holding of exclusivity and preemption

is contrary to accepted preemption analysis

. The holding of exclusivity and preemption

confuses the Convention’s creation of a

cause of action with its self-contained sim-

ple liability rules, as to which uniformity

was prescribed. The uniformity prescribed

by the Treaty does not require or even

invite exclusivity of the cause of action or

preemption of state law.................

The holding of exclusivity and preemption

ignores the historical perspective in which

the Convention was enacted.............

CERTIORARI SHOULD BE GRANTED TO

REVIEW AN INTERPRETATION OF THE

TREATY THAT IGNORES ITS PLAIN

LANGUAGE THAT AN EXCLUSION OF

LIABILITY WILL BE DENIED TO AN AIR-

LINE WHEN THE DAMAGE HAS BEEN

CAUSED BY ITS WILFUL MISCONDUCT.

Vii

PAGE

III. CERTIORARI SHOULD BE GRANTED

BECAUSE THE DECISION BELOW CON-

FLICTS WITH DECISIONS OF THIS

COURT WHICH UPHOLD COMMON LAW

PUNITIVE DAMAGES AND BECAUSE IT

MISCONSTRUES A TREATY WHICH WAS

NOT INTENDED TO EXTINGUISH COM-

MON LAW RIGHTS EXCEPT AS SPECIFI-

CREE Oe 0 oo rss cnccscccncveueetes 24

A. A punitive damages bar conflicts with

recent decisions of this Court which

uphold common law punitive damages and

consider common law tradition as part of

Warsaw’s background................... 24

B. Article 24 preserved common law punitive

So ee 26

C. Article 17 establishes the conditions for

airline liability and does not bar punitive

SN 6 clad ua Si ob canke Verewascenkeeets 27

IV. CERTIORARI SHOULD BE GRANTED

BECAUSE IMPORTANT QUESTIONS OF

TREATY INTERPRETATION ARE

TE sos cnbecvovesncestnennaveeneebs 29

CREE cbt reeebcvweeee es nevestessesecseees 30

PPE PEI 6 oe c cece ese cesecseeueenne sé Teetacdenes Al

Viil

TABLE OF AUTHORITIES

Cases: , PAGE

Abramson v. Japan Air Lines, 739 F.2d 130 (3d Cir.

1984), cert. denied, 470 U.S. 1059 (1985).......... 13, 17

Alvarez v. Aerovias Nacionales de Colombia, S.A.

Avianca Inc., 750 F. Supp. 550 (S.D. Fla. 1991)..12-13, 22

Air France v. Saks, 470 U.S. 392 (1985)...... 8, 10, 29, 31

Benjamins v. British European Airways, 572 F.2d 913

(2d Cir. 1978), cert. denied, 439 U.S. 1114 (1979).. 17

Boehringer-Mannheim Diagnostics, Inc. v. Pan Ameri-

can World Airways, 737 F.2d 456 (Sth Cir. 1984),

app. dsm’d, cert. denied, 469 U.S. 1186 (1985) ....13, 17

Browning-Ferris v. Kelco Disposal, 492 U.S. 257

GL sh UaNG cs eee Nye ce aueceadakusseexesan 9, 25, 26, 27

Calderon v. Aerovias Nacionales de Colombia

Avianca, Inc., 738 F. Supp. 485 (S.D. Fla. 1990),

app. dism’d for lack of jurisdiction, 929 F.2d 599

Cee hs ns bos cose eae nee eecaserewectne ees 11, 13

California v. ARC America Corp., 490 U.S. 93 (1989) .18, 19

Chan v. Korean Air Lines, 490 U.S. 122 (1989).8, 14, 24, 31

Chesapeake & Ohio Railway Co. v. Kelly, 241 U.S. 485

er eer Pere er Pre ree 18

Cohen v. Varig Airlines, 62 A.D.2d 324, 405 N.Y.S.2d

OS CR re a occ wck usa d eee te) casecescgaess 18

Eastern Airlines v. Floyd, 499 U.S. __, 113 L. Ed.

ye Be te a Ot eer 8, 10, 31

Eggink v. Trans World Airlines, 1990 WL 6553, No.

yee me FF 808 8 |= 6 re eee 11, 13

PAGE

English v. General Electric Co., 495 U.S. ___., 110

eT So cag et Ee cath waeeest 19

Floyd v. Eastern Airlines, 872 F.2d 1462 (11th Cir.

1989), rev’d on other grounds, 499 U.S. ____, 113

L. Ed. 2d 569, 111 S.Ct. 1489 (1991) ......... 17, 19, 26

Guaranty Trust Co. of New York v. United States, 304

oe Ne eae ce ate eae es 22, 26

Harris v. Polskie Linie Lotnicze, 820 F.2d 1000 (9th

SETI cine darn wis Gb 0.0000 000 Odewee we sue eedeene< 17

Robert C. Herd & Co. v. Krawill Machinery, 359 U.S.

NLC baad baeeot candace ooc aes cue e « 23, 26

Hines v. Davidowitz, 312 U.S. 52 (1941) ............ 22

Huron Cement Co. v. Detroit, 362 U.S. 440 (1960) .. 19

In re Air Crash in Bali, Indonesia, 684 F.2d 1301 (9th

8 re Pee ee 12, 17

In re Air Crash at Gander, Newfoundland, 660 F.

SE, Ge ee Ee Bc vc cn wncceccucnencees 3, 435

In re Air Disaster in Lockerbie, Scotland, 733 F. Supp.

547 (E.D.N.Y. 1990), aff’d, 928 F.2d 1267 (2d Cir.

PEE edi ae Oe 466 hake OU das 0 Weck oe hue ohne passim

In re Air Disaster at Lockerbie, Scotland, 928 F.2d

Se Se I I ead dh au caecheuecdendesceet ee passim

In re Hijacking of Pan American World Airways at

Karachi, 729 F. Supp. 17 (S.D.N.Y. 1990), rev’d sub

nom. In re Air Disaster at Lockerbie, Scotland, 928

ee Se) I ED a's 60 00.60 cence eee cccace passim

In re Korean Air Lines Disaster of September I, 1983,

S32 Fide U4TS GUC. Car. TRA) on ccccccccccccs 10, 12, 15

PAGE

In re Mexico City Aircrash of October 31, 1979, 708

eee ee. a eee | a a

Kolovrat v. Oregon, 366 U.S. 187 (1961)............ 31

Lisi v. Alitalia, 390 U.S. 455 (1968) ................ 31

Mertens v. Flying Tiger Line, 341 F.2d 851 (2d Cir.),

ae ae OR a) ) ne 17

City of Newport v. Facts Concerts Inc., 453 U.S. 247

yt RP ee et ee ae ee 31

Newsome v. Trans International Airlines, 492 So. 2d

592 (Ala.), cert. denied, 479 U.S. 950 (1986) ...... 14

Pacific Mutual v. Haslip, 499 U.S. ___, 113 L. Ed.

ye tie <> ae e) |) re 9, 2, ay 2), 3!

Perkin Elmer (Computer Systems Division) v. Trans

Mediterranean Airways, S.A.L., 107 F.R.D. 55

Rds OD encdath BUR eteb he ober besusaneeyen 13

Rhymes v. Arrow Air, 636 F. Supp. 737 (S.D. Fla.

| SE ee ee em mare Meer tes ee Sher LE 13, 15

San Diego Building Trades Council v. Garmon, 359

U.S. 220 CIDR) «oc une OP Te PTC rer Ee Tr ee 20

Sheris v. Sheris Co., 212 Va. 825, 188 S.E.2d 367

(Va.), cert. denied, 409 U.S. 878 (1972)........... 14

Silkwood v. Kerr-McGee Corp., 464 U.S. 238

RA ers br ee ere er pear? 19, 26, 30

Smith v. Wade, 461 U.S. 30 (1983) .............. 9, 26, 30

Stanford v. Kuwait Airlines Corp., 705 F. Supp. 142

Sas oa: SEs Sua Sea cis aen res coaneharbneenee es 13

Tokio Marine & Fire Ins. Co. Ltd. v. McDonnell

Douglas Corp., 617 F.2d 936 (2d Cir. 1980)....... 12

Trans World Airlines v. Franklin Mint, 466 U.S. 243

Rs GS Ose aca bn ete at ae rea eke aren At eee 26, 31

Velasquez v. Aerovias Nacionales de Colombia, S.A.,

Fat FB. Sapp. Gre GB. FM. FORD once ccccccscees 13

Washington v. Washington State Commercial Passen-

ger Fishing Vessel Ass’n., 443 U.S. 658 (1979)..... 3]

Statutes and Other Authorities:

ae Oe EET och cua pad de ose cae e eevee acueens 2

Be ee UE 6553.5 o GAs boo es deae nh eee se eaaeess 5, 6

ee EE a 6.0 ie cb oa dee ehe Nees caeecees 4,5

Be Sse ah bso 60s -<kkade ee bane aeebea eee 4,5

ee We a od du dense chees coe dekeeekaee baaee 30

N.Y. Estates, Powers & Trusts Law § 5-4.3(b)...... 10

Convention for the Unification of Certain Rules Relat-

ing to International Transportation by Air, Oct. 12,

1929, 49 Stat. 3000, T.S. No. 876 (1934), reprinted

in 49 U.S.C. § 1502 note (1976) (Warsaw Conven-

No.3 6 6 Winona 3c tk bbe Pabst ee ean passim

Agreement Relating to Liability of the Warsaw Con-

vention and Hague Protocol, Agreement CAB 18900,

Approved by Executive Order E-23680, May 13,

1966 (Docket 17325), 31 Fed. Reg. 7302 (1966),

reprinted in Civil Aeronautics Board, Aeronautica!

Statutes and Related Material 515-16 (1974) (Mon-

RR er a re ek Per ere 4,6

Calkins, The Cause of Action Under the Warsaw Con-

vention, 26 J. Air L. & Com. 323 (1959)...... i es

Drion, Limitation of Liabilities in International Air

Law, 135 (Martinus Nijhoff 1954)............. 16, 18, 28

Xil

PAGE

Haanappel, The Right to Sue in Death Cases Under the

Warsaw Convention, 6 Air. L. 66 (1981).......... 18,

Matte, Treatise on Air-Aeronautical Law, 382 (McGill

University 1981), quoting R.C. Ac. Haye, Volume II

BSRSE it, ae ree apa nn ne ae 16,

__Mazeaud & Tunc, TJraite de la Responsibilité Civile

ea claw els oes kalba hee we ese

Miller, Liability in International Air Transport, 235

Pee ear 16, 18

Report of the President’s Commission on Aviation

Security and Terrorism, May 15, 1990, per Executive

ee SO a cnc cekecesurwine

Second International Conference on Private Aeronauti-

cal Law (R. Horner & D. Legrez trans. 1975)..... 27,

Tunc & McGregor, International Encyclopedia of

Comparative Law, Vol. XI]..........ccccccccceees 28,

IN THE

Supreme Court of the United States

OCTOBER TERM, 1991

No.

DENICE H. REIN, et al.,

Petitioners,

—vV. —

PAN AMERICAN WORLD AIRWAYS INCORPORATED,

Respondent.

DILIP JOSHI, et al.,

Petitioners,

—_—_vV.—

PAN AMERICAN WORLD AIRWAYS INCORPORATED,

Respondent.

PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE SECOND CIRCUIT

>_>

PETITION FOR WRIT OF CERTIORARI

OPINIONS BELOW

The opinion of the Court of Appeals for the Second Cir-

cuit (App. A, infra, pp. Al to A52) is reported at 928 F.2d

1267 (2d Cir. 1991). It affirmed the district court holding in

In re: Air Disaster at Lockerbie, Scotland on December 21,

1988 [Rein et al. v. Pan American World Airways, Incorpo-

rated| (‘‘Lockerbie Disaster’’), and reversed the district court

holding in Jn re: Hijacking of Pan American World Airways,

Inc. Aircraft at Karachi International Airport, Pakistan On

Sept. 5, 1986 [Joshi et al. v. Pan American World Airways,

Inc.| (‘Karachi Hijacking’’). The district court opinion in

Lockerbie Disaster (App. B, infra, pp. B1 to B12) is reported

at 733 F.Supp. 547 (E.D.N.Y. 1990). The district court opin-

ion in Karachi Hijacking (App. C, infra, pp. Cl to C6) is

reported at 729 F. Supp. 17 (S.D.N.Y. 1990). The two

appeals were consolidated in the Second Circuit.

JURISDICTION

The judgment of the Court of Appeals (App. E, infra, El

to E2) was entered on March 22, 1991. By order dated May

14, 1991 (App. D, infra, D1 to D2), the Court of Appeals

denied a petition for rehearing containing a suggestion for

rehearing en banc. The jurisdiction of this Court is invoked

under 28 U.S.C. § 1254(1).

PROVISIONS OF LAW INVOLVED

These cases raise the interpretation of Articles 17, 24 and

25 of the Warsaw Convention Treaty.'

WARSAW CONVENTION

Article 17

The carrier shall be liable for damage sustained in the

event of the death or wounding of a passenger or any other

bodily injury suffered by a passenger, if the accident which

caused the damage so sustained took place on board the air-

craft or in the course of any of the operations of embarking

or disembarking.

| Convention for the Unification of Certain Rules Relating to Interna-

tional Transportation by Air, October 12, 1929, 49 Stat. 3000, T.S. No. 876

(1934), reprinted in 49 U.S.C. § 1502 note (1976) (Warsaw Convention).

Article 24

(1) In the cases covered by articles 18 and 19 any action

for damages, however founded, can only be brought subject

to the conditions and limits set out in this convention.

(2) In the cases covered by article 17 the provisions of the

preceding paragraph shall also apply, without prejudice to

the questions as to who are the persons who have the right to

bring suit and what are their respective rights.

Articie 25

(1) The carrier shall not be entitled to avail himself of the

provisions of this convention which exclude or limit his liabil-

ity, if the damage is caused by his wilful misconduct or by

such default on his part as, in accordance with the law of the

court to which the case is submitted, is considered to be

equivalent to wilful misconduct.

(2) Similarly the carrier shall not be entitled to avail him-

self of the said provisions, if the damage is caused under the

same circumstances by any agent of the carrier acting within

the scope of his employment.

STATEMENT OF THE CASE

Petitioners in Lockerbie Disaster are the surviving relatives

and personal representatives of passengers aboard Pan Am

Flight 103 from London to New York on December 21, 1988.

About forty-five minutes after departure, a bomb inside a

bag checked in the cargo hold of the 747 aircraft exploded.

The plane broke apart in midair and crashed in Lockerbie,

Scotland. All 259 passengers and crew were killed.

Since Flight 103 involved ‘‘international transportation’”’

with a destination or stopping place in the United States,

actions against Pan Am arising from the crash of Flight 103

are governed by the Warsaw Convention and Montreal

Agreement.”

Wrongful death actions seeking compensatory and punitive

damages were commenced in various federal district courts.

Federal jurisdiction was based on either federal question

jurisdiction, 28 U.S.C. § 1331, under the Warsaw treaty, or

diversity jurisdiction, 28 U.S.C. § 1332. The majority of

complaints assert diversity and not federal question jurisdic-

tion. The defendants named in these actions include the car-

rier Pan Am, two Pan Am subsidiary corporations which

provided security services for Flight 103, Alert Management

Services, Inc. (Alert) and Pan Am World Services, Inc.

(World Services), and Pan Am’s parent corporation, Pan Am

Corp. All actions were consolidated for pretrial proceedings

in the Eastern District of New York by order of the Judicial

Panel on Multidistrict Litigation.

On June 2, 1989, respondent Pan Am moved for partial

summary judgment on petitioners’ punitive damage claims,

claiming that punitive damages were barred by the Warsaw

Convention.’

For the purposes of Pan Am’s motion, it was presumed

that the carrier committed wilful misconduct justifying an

award of punitive damages. The extensive proof supporting

petitioners’ punitive damage claims was not submitted on the

2 Agreement Relating to Liability of the Warsaw Convention and

Hague Protocol, Agreement CAB 18900, Approved by Executive Order

E-23680, May 13, 1966 (Docket 17325), 31 Fed. Reg. 7302 (1966), reprinted

in Civil Aeronautics Board, Aeronautical Statutes and Related Material 515-

16 (1974). The Montreal Agreement was signed by Pan Am in 1966 and has

remained in place up until the present time. One of the terms of the Agree-

ment increased the Warsaw damage limitation from $8,300 to $75,000 on

passenger travel with a stopping place in the United States.

3 Defendants Alert and World Services joined in Pan Am’s motion,

alleging “hat the Convention also applied to petitioners’ claims against the

security companies. Since petitioners had not completed their discovery, the

district court did not address the motion of Alert and World Services. Lock-

erbie Disaster, B2.

pure issue of law presented.* Moreover, it was presumed that

the applicable local law permitted the recovery of punitive

damages.

On January 3, 1990, the District Court for the Eastern Dis-

trict of New York entered a memorandum and order granting

Pan Am’s motion.

Petitioners timely moved for reargument, or in the alterna-

tive, for the court to certify the memorandum and order for

interlocutory appeal pursuant to 28 U.S.C. § 1292(b). On

February 26, 1990, the district court entered a second memo-

randum and order denying petitioners’ motion for reargu-

ment, but granting § 1292(b) certification. The Second

Circuit entered an order graniing permission to appeal on

April 27, 1990.

Petitioners in Karachi Hijacking are injured passengers and

the surviving relatives and personal representatives of passen-

gers killed in the hijacking of Pan Am Flight 73 on Septem-

ber 6, 1986. Flight 73 was travelling from Bombay, India to

New York, with stops at Karachi and Frankfurt, West Ger-

many. The plane, with 386 passengers aboard, was hijacked

by four armed terrorists at the Karachi airport. After holding

the passengers and cabin crew hostage for twelve hours, the

terrorists began to fire weapons and unload grenades in the

cabin. Twenty were killed and scores injured, many seriously.

Personal injury and wrongful death actions seeking com-

pensatory and punitive damages were brought against Pan

Am in various federal courts. The actions were consolidated

for pretrial proceedings in the Southern District of New York

by order of the Judicial Panel on Miultidistrict Litigation.

Jurisdiction was based on either federal question jurisdiction,

28 U.S.C. § 1331, under the Warsaw treaty, or diversity

jurisdiction, 28 U.S.C. § 1332.

4 Many of the facts which establish Pan Am’s misconduct and

repeated violations of security standards for Flight 103 are set forth in the

report of the Presidential Commission appointed by President Bush to inves-

tigate the disaster. Report of the President’s Commission on Aviation Secu-

rity and Terrorism, May 15, 1990, per Executive Order 12686 dated Aug. 4,

1989.

Most of petitioners’ actions in Karachi Hijacking against

Pan Am are subject to the Warsaw Convention and Montreal

Agreement.’

By memorandum opinion and order dated June 5, 1989,

the district court denied Pan Am’s motion for partial sum-

mary judgment on the issue of wilful misconduct, finding

that there were triable issues of material facts. (713 F. Supp.

1483).

On September 8, 1989, respondent Pan Am moved for par-

tial summary judgment dismissing petitioners’ punitive dam-

age claims. On January 18, 1990, the district court entered a

memorandum opinion and order denying Pan Am’s motion.

On May 10, 1991, the district court certified the memoran-

dum opinion and order for interlocutory appeal pursuant to

28 U.S.C. § 1292(b). The Second Circuit entered an order

granting permission to appeal on July 18, 1990.

In the courts below, petitioners argued that the Warsaw

Convention did not provide the exclusive cause of action for

injuries and deaths occurring in international air transporta-

tion, and that punitive damages were recoverable in Warsaw

actions when allowed under local law.

The Lockerbie and Karachi appeals were consolidated for

argument. On March 22, 1991, the Second Circuit affirmed

the district court in Lockerbie Disaster and reversed the dis-

trict court in Karachi Hijacking. It held that the Warsaw

Convention provided the exclusive cause of action, preempted

all other causes of action, and did not permit recovery of

punitive damages.

The Second Circuit said that the Warsaw Convention

[P]reempts state causes of action because differences in

the various state laws . . . would introduce such great

confusion into this subject as to destroy any hope of

uniformity in applying the Convention. (A7; 928 F.2d at

1270).

The Second Circuit’s denial of punitive damages was based

on several grounds. The court held that Article 17’s language

5 Pan Am has claimed, however, that the Montreal Agreement does

not apply to those passengers aboard Flight 73 travelling to Frankfurt.

‘‘damage sustained’’ contemplated monetary or compensa-

tory damages only. This finding, the court held, was sup-

ported by ‘‘the context in which [Article 17] was written, the

law of the contracting parties, subsequent interpretations,

and the historical translation.’’ (A35; 928 F.2d at 1282).

Addressing Article 24, the court held:

[T]he drafting history of Article 24, together with the

civil law background of the Convention, make it

extremely unlikely that Article 24(2) was intended by its

drafters to preserve a common iaw right to punitive

damages.

The drafter’s silence on this subject leads logically to the

assumption that punitive damages were not addressed

because they were never contemplated. (A41; 928 F.2d

at 1284).

Turning to Article 25, the court held:

Article 25 voids only certain provisions in the event of

willful misconduct, but the rest of the Convention

remains fully operative, and the Convention as it then

remains still is inconsistent with the notion of a punitive

damages recovery. (A43; 928 F.2d at 1285).

* = *

[L]ifting the monetary limit on compensatory damages is

the Convention’s sole response to willful miscon-

duct. . . . (A44; 928 F.2d at 1285).

Finally, the court concluded that ‘‘consideration of the

purposes behind the Convention compel the conclusion that

the shared expectations of the Convention’s drafters did not

contemplate that punitive damages be available under the

Convention.’’ (A48; 928 F.2d at 1287).

A petition for rehearing containing a suggestion for rehear-

ing en banc was denied by order of the Second Circuit dated

and entered on May 14, 1991. Plaintiffs petition this Court

for a writ of certiorari.

SUMMARY OF ARGUMENT

Certiorari should be granted to resolve a conflict between

the Second Circuit, and the Ninth Circuit and the highest

court of Virginia, on whether the Warsaw Convention Treaty

provides the exclusive cause of action and thus preempts state

common law and statutory law.

The Court of Appeals for the Second Circuit, below, dis-

missed petitioners’ claims for punitive damages. The core of

its position was its conclusion that when the Warsaw Conven-

tion is applicable it establishes the exclusive cause of action,

and that other causes of action, including those that allow

punitive damages, are preempted. Absent preemption, state

laws allowing punitive damages would be available in the case

of wilful misconduct.

This Court has always recognized the importance of its role

in treaty interpretation. It has heretofore expressly declined

to decide the exclusivity of the Convention, Eastern Airlines

v. Floyd, 499 U.S. , 113 L. Ed. 2d 569, 588, 111 S. Ct.

1489 (1991), and Air France v. Saks, 470 U.S. 392, 408

(1985).

The decision below is at variance with the plain language

of Article 24 (2) of the treaty, which refers to actions ‘‘how-

ever founded’’ and thus denies exclusivity. In Chan vy.

Korean Air Lines, 490 U.S. 122, 135 (1989), this Court in

construing this treaty said, ‘‘where the text is clear. . . we

have no power to insert an amendment.’’

The court below also violated the plain language standard

of Chan with respect to Article 25 of the Convention, which

states that a carrier cannot avail itself of any exclusion or

limitation of liability if the damage has been caused by its

wilful misconduct; and with the plain language of the Con-

vention that unified certain specified simple liability rules,

irrespective of the source of the cause of action, and left

other questions to local law.

The Court should also grant the petition for certiorari

because the Second Circuit’s preemption of state rights of

action violates accepted preemption analysis. The circuit

court’s holding was based on an alleged conflict between rec-

ognition of state claims and purported goals of complete uni-

formity ascribed by the court below to the Convention’s

draftsmen. There is no support whatsoever for the allegation

that the drafters sought complete uniformity. Recognition of

state claims which do not circumvent the Treaty’s monetary

limitation does not create an actual conflict with any of the

interests and goals sought to be achieved by the Convention.

This Court should grant the petition for certiorari, also,

because the decision below is in conflict with the analysis and

review of punitive damages by this Court in Haslip as well as

this Court’s refusal to read a punitive damages bar into two

constitutional amendments and two statutes.°

CERTIORARI SHOULD BE GRANTED TO RESOLVE A

CONFLICT BETWEEN THE CIRCUITS ON WHETHER

THE WARSAW CONVENTION TREATY PROVIDES AN

EXCLUSIVE CAUSE OF ACTION, AND TO OVERRULE

AN INTERPRETATION OF THE TREATY IN CONFLICT

WITH ITS PLAIN LANGUAGE AND CONTRARY TO

ACCEPTED PREEMPTION ANALYSIS

A. The holding of exclusivity and preemption was central to

the dismissal, below, of the punitive damages claims

The Court of Appeals for the Second Circuit, below, held

that the federal cause of action arising under the Warsaw

Convention is exclusive and that the ‘‘Warsaw Convention

preempts state law causes of action arising under it’’. (A26;

928 F.2d at 1278). The exclusive cause of action provided by

the Convention, the court held, is governed by the federal

common law of tort.

6 Pacific Mutual v. Haslip, 499 U.S. » 113 L. Ed. 2d 1, 111

S. Ct. 1032 (1991); see also Browning-Ferris v. Kelko Disposal, 492 U.S. 257

(1989); Silkwood v. Kerr-McGee, 464 U.S. 238 (1984); Smith v. Wade, 461

U.S. 30 (1983).

This issue of exclusivity was expressly left open by this

Court in Air France v. Saks, 470 U.S. 392, 408 (1985), and,

more recently, in Eastern Airlines v. Floyd, 499 U.S.

113 L. Ed. 2d 569, 588, 111 S. Ct. 1489 (1991).

The Court of Appeals, below, said:

We conclude that the Convention preempts state causes

of action because differences in various state laws—

some of which view punitive damages as penal in nature,

some compensatory, and some both—would introduce

such great confusion into this subject as to destroy any

hope of uniformity in applying the Convention. The

Convention therefore bars state wrongful death actions

in cases arising under it. (A6-7; 928 F. 2d at 1270).

The finding of exclusivity by the Court below was a neces-

sary part of its barring of punitive damages. Article 25 of the

Convention directs that a carrier responsible for wilful mis-

conduct ‘‘shall not be entitled to avail himself of the provi-

sions of this convention which exclude or limit his liability

If the Convention’s cause of action were not exclusive then

other rights to punitive damages would exist under state com-

mon law and statutory law. In New York, for example,

where the actions are pending and Pan Am’s Headquarters

are located, punitive damages are recoverable, by statute, in

death cases. N.Y. Estates, Powers & Trusts Law § 5-4.3(b).

In the event of wilful misconduct they would exist. Thus it

was only the finding of exclusivity and preemption of state

law claims that excluded punitive recoveries. Judge Mikva,

dissenting in Jn re Korean Air Lines Disaster of September 1,

1983, 932 F.2d 1475 (D.C. Cir. 1991), said:

It is one thing to say that the Convention prohibits puni-

tive damages because it is the sole available cause of

action and does not provide for them; it is quite another

to conclude that Article 17 acts as a limitation on dam-

ages restricting recovery under other causes of action

that allow punitive damages (/d. at 1493).

B. The holding of exclusivity and preemption has wide-

ranging consequences in Warsaw Convention cases

The effect of this holding in the instant cases is to deny

any recovery for punitive damages in these actions. The hold-

ing, however, has wide-ranging consequences in all Warsaw

Convention cases, and also impacts federal removal jurisdic-

tion. It means, for example, that all Warsaw Convention

cases, whether they be for personal injury, wrongful death,

baggage loss, or damage to cargo, are likely to be handled by

the federal courts.

This is because any Warsaw case brought in state court

would be removable. On the other hand, if, as petitioners

contend, state law claims are cognizable, then these claims

could be brought in state court and would not be subject to

removal. See Calderon v. Aerovias Nacionales de Colombia,

Avianca, Inc., 738 F. Supp. 485 (S.D. Fla. 1990) (state law

complaint not removable; case remanded to state court), app.

dism’d for lack of jurisdiction, 929 F.2d 599 (11th Cir. 1991);

Eggink v. Trans World Airlines, 1990 WL 6553, No. 87 Civ.

3403 (S.D.N.Y. 1990) (‘‘the federal cause of action under the

Warsaw Convention ts the exclusive cause of action’’ and

what plaintiff has pleaded in his complaint ‘‘must necessarily

be a federal claim’’; court denied plaintiffs’ cross motion to

remand case to state court).

The nature and elements of recoverable compensatory

damages and the recipients of these damages, which have

heretofore been governed in the United States by local law,

are greatly affected by whether a claim is based on state law

or federal common law. Under the decision below all Warsaw

cases will be based on federal common law subject to the

Convention’s limitations.

The Second Circuit’s holding will, therefore, unless it is

corrected, affect the nature and outcome of Warsaw litiga-

tion for many years and many litigants.

C. The holding of exclusivity and preemption conflicts with

holdings of the Ninth Circuit, the highest court of one

state, and other courts

The holding below squarely conflicts with the rulings of the

Court of Appeals for the Ninth Circuit in Johnson v. Ameri-

can Airlines, 834 F.2d 721, 723 (9th Cir. 1987); In re Air-

crash in Bali, Indonesia, 684 F.2d 1301, 1311 n. 8 (9th Cir.

1982) (‘‘{T]he Convention has never been read to /imit plain-

tiffs to a cause of action arising thereunder, but rather to

limit the recovery in suits for injury’’); and Jn re Mexico City

Aircrash of October 31, 1979, 708 F.2d 400, 414 n. 25 (9th

Cir. 1983) (reading Bali as holding that ‘‘any cause of action

created by Warsaw Convention is not exclusive’’).

In Mexico City, supra, the Ninth Circuit held:

{T]he delegates did not intend that the cause of action

created by the Convention to be exclusive. . . state law

causes of action may be invoked by plaintiffs injured

during international air transportation. Such causes of

action might, consistently with the Convention, provide

varying measures of damages or varying specifications

of persons entitled to recover... . Jd. at 414, n. 25.

The Second Circuit’s holding also conflicts with the conclu-

sions of several other federal courts and judges. See Jn re

Korean Air Lines Disaster of September 1, 1983, 932 F.2d

1475, 1492 (D.C. Cir. 1991) (dissenting opinion by Mikva, J.)

(The Second Circuit’s exclusivity holding in Lockerbie Disas-

ter is ‘‘fundamental error’’. The majority did not reach this

issue);’ Tokio Marine & Fire Ins. Co. Ltd. v. McDonnell

Douglas Corp., 617 F.2d 936, 942 (2d Cir. 1980), inferen-

tially overruled by the court below, (stating that the language

of Article 24 indicates that ‘‘the Convention draftsmen. .

did not intend . . . [the Convention’s] cause of action to be

7 Korean Air Lines held that no punitive damages were allowed in a

case governed by the Warsaw Convention. Plaintiffs in that case based their

claim to such damages on general maritime law. The Korean Air Lines plain-

tiffs have filed a Petition for Certiorari on the punitive damages issue, raising

many of the same issues presented in this Petition.

exclusive’’); Alvarez v. Aerovias Nacionales de Colombia,

S.A., Avianca Inc., 756 F. Supp. 550 (S.D. Fla. 1991);

Rhymes v. Arrow Air, 636 F. Supp. 737, 741 (S.D. Fla.

1986) (Warsaw does not provide exclusive cause of action in

cases where it applies but an exclusive remedy; ‘‘the Plaintiff

may choose to state his cause of action solely on a state law

theory . . . subject to the limitations of the Convention’’);

Calderon vy. Aerovias Nacionales de Colombia, Avianca,

Inc., 738 F. Supp. 485 (S.D. Fla. 1990), app. dism’d for lack

of jurisdiction, 929 F. 2d 599 (11th Cir. 1991); In re Air

Crash Disaster at Gander, Newfoundland, 660 F. Supp. 1202,

1221 (W.D. Ky. 1987) (Warsaw not intended to displace state

law); Perkin Elmer (Computer Systems Division) v. Trans

Mediterranean Airways, S.A.L., 107 F.R.D. 55, 61

(E.D.N.Y. 1985) (‘‘state law cause of action may be availa-

ble, even if a federal claim exists under the Convention’’).

These decisions have been largely based on the ‘‘however

founded’’ language of Article 24 of the Convention (see Sec-

tion I(D) p. 14, infra.)

Several other courts, including the Court of Appeals for

the Fifth Circuit, have taken the same exclusivity position as

the court below. Boehringer-Mannheim Diagnostics, Inc. v.

Pan American World Airways, 737 F.2d 456, 459 (Sth Cir.

1984) app. dsm’d, cert. denied, 469 U.S. 1186 (1985); Velas-

quez v. Aerovias Nacionales de Colombia, S.A., 747 F.

Supp. 670 (S.D. Fla. 1990); Stanford v. Kuwait Airlines

Corp., 705 F. Supp. 142 (S.D.N.Y. 1989); Eggink v. Trans

World Airlines, 1990 WL 6553, No. 87 Civ. 3403 (S.D.N.Y.

1990). Cf. Abramson v. Japan Air Lines, 739 F.2d 130, 134

(3d Cir. 1984), cert. denied, 470 U.S. 1059 (1985).

In sum, the federal district and circuit courts are in conflict

on whether the Warsaw Convention provides the exclusive

cause of action, precluding even claims predicated on state

law which adhere to the Convention’s express limitations and

conditions.

The highest court of Virginia has also reached a conclusion

on the exclusivity issue in conflict with the decision below.’

8 Sheris v. Sheris Co., 212 Va. 825, 188 S.E.2d 367 (Va.), cert. denied,

409 U.S. 878 (1972) (‘‘the Warsaw Convention does not create an indepen-

D. The holding of exclusivity and preemption is contrary to

the plain language of the Warsaw Convention

The Secoud Circuit’s exclusivity holding is directly contrary

to the clear language of the Warsaw Convention.’

Article 24 states:

--(1)-In the cases covered by articles 18 and 19 [i.e., bag-

gage and delay claims] any action for damages, however

founded, can only be brought subject to the conditions

and limits set out in this convention.

(2) In the cases covered by article 17 [i.e., the death or

injury of a passenger] the provisions of the preceding

paragraph shall also apply, without prejudice to the

questions as to who are the persons who have the right

to bring suit and what are their respective rights.

(Emphasis added.)

The words ‘‘however founded’’ permit one conclusion—

that rights of action outside the Convention may be brought,

subject to the Convention’s limitations. They mean that the

Convention cause of action is not exclusive.

The ‘‘however founded’’ language has been relied on by

several courts which have found the Convention cause of

action non-exclusive. See citations Section I(C), pp. 12-13,

supra.

Further textual support for non-exciusivity comes from

Article 24(2) which states that the Convention applies ‘‘with-

out prejudice to the questions as to who are the persons who

have the right to bring suit’? and ‘‘what are their respective

rights.’’ (Emphasis added).

dent right of action but only a presumption of liability leaving it for local law

to grant the right of action’); Contra Newsome v. Trans International Air-

___lines,492 So. 2d 592, 599 (Ala. Sup. Ct.) (Warsaw preempts state common

law causes of action), cert. denied, 479 U.S. 950 (1986).

9 In Chan v. Korean Air Lines, 490 U.S. 122 (1989), a Warsaw Con-

vention case, the Supreme Court held ‘‘[w]e must thus be governed by the

text. . . where the text is clear. . . we have no power to insert an amend-

iment.’’ Jd. at 134.

E. The holding of exclusivity and preemption is contrary to

the views of leading commentators

A leading commentator has written that the Convention

both created a cause of action and allowed tort actions to be

brought outside the Convention. Calkins, The Cause of

Action Under the Warsaw Convention, 26 J. Air L. & Com.

323, 327-8 (1959) (Calkins, the author, served as Chairman of

the United States Delegation to the 1955 Hague Convention).

Calkins concluded:

There is nothing in the Convention which automatically

makes the cause of action under Warsaw supercede all

other causes of action... .

Not only is the implication from the drafting of Article

24 clear that the possibility of tort action was contem-

plated, but this point was specifically raised in the pre-

liminary discussions held in Madrid by the Citeja.

From Warsaw’s inception, commentators have agreed that

the treaty is not exclusive. Drion, Limitation of Liabilities in

International Air Law 135-6 (Martinus Nijhoff 1954) (Article

24 and its drafting history confirm that an action may be

‘*founded on the contract or brought outside the contract as

an action in tort. . .’’); Matte, Treatise on Air-Aeronautical

Law 382 (McGill University 1981), quoting R.C. Ac. Haye,

Vol II, p. 285 (1934) (The Convention ‘‘set new bounds on

an action in liability, boundary limits, but without regulating

the essence itself.’’); Miller, Liability in International Air

Transport 235 (Kluwer 1977) (‘‘The phrase ‘however

founded’ in Article 24(1) shows that the drafters of the Con-

vention were aware that an action might be brought on sev-

eral possible grounds.’’).

F. The holding of exclusivity and preemption conflicts with

the convention’s direction to leave damages to local law

Article 17 provides:

The carrier shall be liable for damage sustained in the

event of the death or wounding of a passenger or any

other bodily injury suffered by a passenger, if the acci-

dent which caused the damage so sustained took place

on board the-aircraft . .

While the courts have held that Article 17 creates a cause

of action for passenger injuries or death,’® they have also uni-

formly held that Article 17 does not define or limit the type

of damages recoverable in Warsaw cases.

The overwhelming majority of courts addressing the issue

have held that Article 24(2) left questions of the elements of

damages to local law, with application of the forum’s choice

of law and substantive law rules. Harris v. Polskie Linie Lot-

nicze, 820 F.2d 1000, 1002 (9th Cir. 1987) (‘‘the Warsaw

Convention . . . does not precisely describe how to calculate

damages in a wrongful death case’’ and ‘‘damages are to be

measured according to the internal law of a party to the Con-

vention’’); Jn re Aircrash in Bali, Indonesia, 684 F.2d 1301,

1306 (9th Cir. 1982) (applying California damage law, the

court stated: ‘‘The Warsaw Convention requires recourse to

local law to determine certain issues.’’); Karachi Hijacking,

supra, 729 F.Supp. at 19 (S.D.N.Y. 1990), rev’d sub nom In

Re Air Disaster at Lockerbie, Scotland, 928 F.2d 1267 (2d

Cir. 1991) (‘‘the Convention leaves many issues to be gov-

erned by the internal law of the parties to the Convention.

One such issue is the question of what items of damages are

recoverable.’’); Mertens v. Flying Tiger Line, 341 F.2d 851,

858 (2d Cir.), cert. denied, 382 U.S. 816 (1965), (‘‘regarding

the issue as to which items of damage can be properly

included in the award. . . [i]t seems clear that the Warsaw

Convention left this issue, as it did other issues . . . to the

internal law of the parties to the Convention . . .’’); Cohen

v. Varig Airlines, 62 A.D.2d 324, 334, 405 N.Y.S.2d 44, 49

10 Floyd v. Eastern Airlines, 872 F.2d 1462, 1469 (11th Cir. 1989),

rev’d on other grounds, 499 U.S. , 111 S. Ct. 1489, 113 L. Ed. 2d 569

(1991); Benjamins v. British European Airways, 572 F.2d 913, 916-9 (2d.

Cir. 1978), cert. denied, 439 U.S. 1114 (1979); Boehringer-Mannheim Diag-

nostics, Inc. v. Pan American World Airways, 737 F.2d 456 (Sth Cir. 1984),

app. dism’d, cert. denied, 469 U.S. 1186 (1985); In re Mexico City Air Crash

of October 31, 1979, 708 F.2d 400 (9th Cir. 1983); Abramson v. Japan Air-

lines, 739 F.2d 130 (3d Cir. 1984), cert. denied, 470 U.S. 1059 (1985).

—

(1st Dep’t 1978) (court applies New York choice of law rules

and concludes that ‘‘[djamages . . . should be awarded in

accordance with the laws of New York.’’).

These decisions are supported by commentators on the

Warsaw Convention.’

Clearly, the question of the type and elements of recover-

able damages was left to law outside the Convention. Thus

rights of action outside the Convention were not foreclosed.

‘(T]he question of the proper measure of damages is insepa-

rably connected with the right of action.’’ See Chesapeake &

Ohio Railway Co. v. Kelly, 241 U.S. 485, 491 (1916). Having

left the issues of damages (among other issues) to local law,

it is incongruous to presume that the Convention was

intended to circumvent other rights of recovery under local

law.

G. The holding of exclusivity and preemption is contrary to

accepted preemption analysis

The holding, below, is contrary to accepted preemption

analysis. There is a general presumption against finding pre-

emption of state law in areas traditionally regulated by the

States. California v. ARC America Corp., 490 U.S. 93, 101

(1989).

There is nothing in the text or Convention’s drafting his-

tory that suggests that the Warsaw Convention provides the

11 H. Drion, Limitation of Liabilities in International Air Law 125-6

(Martinus Nijhoff 1954) (noting that under Article 24(2), ‘‘[t]he criteria for

determining the categories of recoverable damages [under the Warsaw Con-

vention] and the measure of damages vary greatly from country to coun-

try,’’); Miller, Liability in International Air Transport 117 (Kluwer 1977)

(‘‘the issue of compensable damages is not regulated by the Convention and

thus has to be governed by a law selected on the basis of the applicable choice

of law rule.’’); Haanappel, The Right to Sue in Death Cases Under the War-

saw Convention, 6 Air. L. 66 (1981) (recoverable damages determined by

local law); N. Matte, Treatise on Air-Aeronautical Law 383, 419-20 (McGill

University 1981) (Regarding the issue of damages, the author states ‘‘Given

that, in each case, it is the /ex fori which will be the determining factor, it

would be difficult to envisage a general rule, inasmuch as the Convention

itself is not completed to this effect . . .’’).

exclusive right of recovery. Clearly, the Convention does not

expressly foreclose state claims. Nor does the Convention so

pervasively regulate any liability/damages scheme to make

reasonable the inference that enforcement of state law is pre-

cluded’*. Within the United States recovery for personal inju-

ries and wrongful death has traditionally been an area of

state legislation and regulation. The Convention was not

intended to ‘‘occupy the field’’ in the realm of rights, obliga-

tions and recoveries in an international air disaster, a requi-

site to traditional preemption analysis. See Floyd v. Eastern

Airlines, supra, 872 F.2d at 1469, rev’d on other grounds,

499 USS. , 113 L.Ed.2d 569 (1991) (‘‘the delegates at

Warsaw in no way considered their work definitive’). A

“‘clear and manifest’’ intent to supersede state laws in an area

traditionally occupied by the states is nowhere to be found in

the Convention itself, its history or in any Act of Congress.

See English v. General Electric Co., 495 U.S. ___, 110 L.

Ed. 2d 65, 74-75 (1990).

The Second Circuit’s finding of preemption runs counter to

recent decisions of this Court holding against preemption of

state tort remedies. English v. General Electric Co., 495 U.S.

, 110 L. Ed. 2d 65 (1990); Silkwood v. Kerr-McGee

Corp., 464 U.S. 238 (1984). See also California v. ARC

America Corp., 490 U.S. 93, 105 (1989) (state antitrust laws

not preempted; ‘‘Ordinarily, state causes of action are not

pre-empted solely because they impose liability over and

above that authorized by federal law’’).

The holding below runs afoul of decisions of this Court

which enjoin ‘‘seeking out conflicts between state and federal

regulation where none exists.’’ Huron Cement Co. v. Detroit,

362 U.S. 440, 446 (1960). The decision below did just that.

Preemption is not to be implied absent an ‘‘actual conflict’’

between state law and federal interests and objectives.

English v. General Electric, supra, 110 L. Ed. 2d at 74, 81.

Recognition of state tort causes of action in a Warsaw case

would not create an ‘‘actual conflict’? with any interests

12 Indeed, the Convention’s title is ‘‘Convention for the Unification of

Certain Rules relating to International Transportation by Air’’ (emphasis

added), and not ‘‘all rules.’’

within the limited ambit of the Convention sought to be pro-

moted.

H. The holding of exclusivity and preemption confuses the

Convention’s creation of a cause of action with its self-

contained simple liabilif. rules, as to which uniformity

was prescribed. The uniformity prescribed by the Treaty

does not require or even invite exclusivity of the cause of

action and preemption of state law

In reaching its preemption holding, the Second Circuit

relied on federal preemption doctrine that state law may be

preempted ‘‘when the subject matter demands uniformity

vital to national interests such that allowing state regulation

‘would create potential frustration of national purposes’ ’’,

quoting San Diego Building Trades Council v. Garmon, 359

U.S. 236, 244 (1959) (A18; 928 F.2d at 1275).’? Allowance of

state claims for death and injuries, the court below held,

would frustrate the desire for uniformity in the laws govern-

ing carrier liability and the need for certainty in the applica-

tion of those laws.

The attempt by the court below to promote uniformity

exceeds and distorts the uniformity goals sought by the draft-

ers of the Convention. The title itself of the Warsaw Conven-

tion; states it is a Convention for the unification of ‘‘certain

rules,’’ and not all rules. As indicated above, damages are

not among those rules, and have uniformly been governed by

local law. In the United States damages have been determined

by state law chosen through local choice of law rules. Peti-

tioners believe that in both the Lockerbie and Karachi cases

New York law (the place of incorporation of the principal

defendant and the place of egregious corporate conduct)

would apply to punitive damages.

The rules of the Convention on which uniformity is pre-

scribed are quite simple. Article 17 establishes that the carrier

is liable. Article 20 provides that the carrier can exculpate

13 **It is under this latter doctrine that we deduce the Convention pre-

empts state law causes of action.’’ Lockerbie Disaster, A18; 928 F.2d at

1275.

itself if it proves it took all necessary measures to prevent the

damage. Article 22 places a limit on the liability of the car-

rier. Article 25 provides that the carrier may not avail itself

of the limit if the damage has been caused by its wilful mis-

conduct. Article 28 specifies where suit may be brought. In

addition, Articles 3, 4, 5, 6, and 8 establish uniformity as to

documentation such as tickets and waybills.

Several other articles expressly leave particular matters to

local law. Article 24 (2), by providing that the Convention

applies ‘‘without prejudice to the questions as to . . . what

are their [plaintiffs’] respective rights,’’ provides that local

law defines damages elements. Article 21 leaves the rules con-

cerning contributory negligence, Article 25 leaves the defini-

tion of wilful misconduct, Article 28 (2) leaves matters of

procedure and Article 29 (2) leaves the method of calculating

the time limitation period to the law of the court to which

the case is submitted.

The Court of Appeals, below, confused these simple, built-

in rules, on which uniformity was intended and expressly pre-

scribed, with the existence of the cause of action created by

the Convention and the existence of state causes of action

including those which permit punitive damages. The court

said:

Hence, the test to be applied is whether these goals of

uniformity and certainty are frustrated by the availabil-

ity of state causes of action for death and injuries suf-

fered by passengers on international flights. We do not

see how the existence of state law causes of action could

fail to frustrate these purposes. (A18; 928 F.2d at 1275).

The court was wrong. The Convention is specific as to

which rules should be uniform and certain. Damages is not

one of them. On the contrary they are specifically excluded

from uniform treatment by Article 24 (2). The identity of the

cause of action ‘‘however founded’’ is irrelevant to the iden-

tity of the rules which are uniform and certain. The rules are

uniform and certain irrespective of the source of the cause of

action.

State law claims which do not attempt to circumvent War-

saw’s limitations and conditions do not threaten the Conven-

tion’s uniformity goals in any way. ‘‘[T]he uniformity desired

by the drafters of the Convention was not complete and utter

uniformity . . . By creating an exclusive remedy, the Con-

vention achieved the uniformity desired while still allowing

the use of state law.’’ Alvarez v. Aerovias Nacionales de

Colombia, supra, 756 F. Supp. at 555; Calkins, The Cause of

Action under the Warsaw Convention, supra, J. Air L. &

Com. 323, 342 (1959) (‘‘The need for uniformity does not

apply to the question of what constitutes ‘damage’. The Con-

vention is silent on this point’’).

Allowance of state claims would not stand ‘‘as an obstacle

to the accomplishment and execution of the full purposes and

objectives’’ of the Convention. See Hines v. Davidowitz, 312

U.S. $2, 67-68 (1941).

I. The holding of exclusivity and preemption ignores the his-

torical perspective in which the Convention was enacted

A treaty must be read in light of the laws existing at the

time of its enactment. As the Supreme Court has ruled, ‘‘the

language of a treaty wherever reasonably possible will be con-

strued so as not to override state laws or to impair rights

under them.’’ Guaranty Trust Co. of New York v. United

States, 304 U.S. 126, 143 (1938). Similarly, the Court has

stated that ‘‘[nJo statute is to be construed as altering the

common law, farther than its words import.’’ Robert C.

Herd & Co. v. Krawill Machinery Corp., 359 U.S. 297, 304

(1959).

When the Warsaw Convention was concluded in 1929 and

adhered to by the United States in 1934 there were few fed-

eral rights of action for wrongful death. The internal law of

the United States consisted of both federal and state law.

When the draftsmen left the resolution of damages issues to

the local law of member nations, this necessarily invoked the

laws of the states in the United States as well as the nation.

Neither the Convention’s text nor history nor purposes per-

mits the abrogation of state-based rights and there was no

enabling legislation by Congress that made federal law exclu-

sive.

Whatever the merits of the Second Circuit’s effort to sim-

plify Warsaw litigation brought in American Courts, the fact

remains that its holding is unwarranted by anything in the

Convention or in any act of Congress. The holding below

exceeds the uniformity established by the Convention. The

Convention was not intended to eliminate all conflict of laws

problems. Indeed, by resorting to local law in numerous

instances, the treaty recognized the diversity of the legal sys-

tems of the numerous member states which adhered to the

Convention. The Convention accepted and recognized the

myriad laws of its member nations, provided the elemental

monetary limits of the Convention were not exceeded. The

Second Circuit’s holding, below, does what the draftsmen

purposefully eschewed.

CERTIORARI SHOULD BE GRANTED TO REVIEW AN

INTERPRETATION OF THE TREATY THAT IGNORES

ITS PLAIN LANGUAGE THAT AN EXCLUSION OF

LIABILITY WILL BE DENIED TO AN AIRLINE WHEN

THE DAMAGE HAS BEEN CAUSED BY ITS WILFUL

MISCONDUCT

Article 25 (1) of the Warsaw Convention provides:

The carrier shall not be entitled to avail himself of the

provisions of this convention which exclude or limit his

liability, if the damage is caused by his wilful miscon-

duct or by such default on his part as, in accordance

with the law of the court to which the case is submitted,

is considered to be equivalent to wilful misconduct.

The district court, below, in Karachi Hijacking correctly

held that that language ended any debate about whether the

Convention excluded punitive damages. The district court

said:

Therefore, to the extent that Article 17 is construed to

preempt a claim for punitive damages, it would be a

limitation or exclusion of liability within the meaning of

Article 25, and such claims would not be barred in cases

involving wilful misconduct. (C4, 729 F. Supp at 20).

In Chan v. Korean Air Lines, supra, 490 U.S. 122, 134,

(1989), also involving the Warsaw Convention, this Court

said:

We must thus be governed by the text . . . whatever

conclusions might be drawn from the intricate drafting

history . . . But where the text is clear. . . we have no

power to insert an amendment.

Certiorari should therefore be granted to review the hold-

ing below in which the Court of Appeals fails to give the

Convention its clear meaning. The court below struggles with

the point at 928 F.2d 1285-1287, but cannot answer it. At

1285 it says ‘‘{[wJe conclude that Article 17 is not one of the

limitations or exclusions to which Article 25 refers.’’ But

Article 25 doesn’t specify particular exclusions or limitations.

As the district court said in Karachi Hijacking any provision

in the Convention which excluded or limited liability would

be barred by wilful misconduct.

The Court of Appeals below says, ‘‘we think lifting the

monetary limit on compensatory damages is the Convention’s

sole response to willful misconduct . . .”’ (A44; 928 F.2d at

1285). But that is obviously not what the plain language of

Article 25 says. That-plain language dictates that any exclu-

sion or limitation of liability is lost to the carrier if the dam-

age was caused by its wilful misconduct.

Ill

CERTIORARI SHOULD BE GRANTED BECAUSE THE

DECISION BELOW CONFLICTS WITH DECISIONS OF

THIS COURT WHICH UPHOLD COMMON LAW PUNI-

TIVE DAMAGES AND BECAUSE IT MISCONSTRUES A

TREATY WHICH WAS NOT INTENDED TO EXTIN-

GUISH COMMON LAW RIGHTS EXCEPT AS SPECIFI-

CALLY STATED

Given this Court’s recent decisions on punitive damages,

certiorari should be granted to review whether the Warsaw

treaty bars the award of punitive damages when allowed

under American common and statutory law.

A. A punitive damages bar conflicts with recent decisions of

this Court which uphold common law punitive damages

and consider common law tradition as part of Warsaw’s

background

Four recent decisions of this Court upheld common law

punitive damages and rejected claims that the Constitution or

federal statutes bar punitive awards. Pacific Mutual v.

Haslip, 499 U.S. ____, 113 L. Ed. 2d 1, 111 S. Ct. 1032

(1991) (Fourteenth Amendment of the Constitution);

Browning-Ferris v. Kelco Disposal, 492 U.S. 257 (1989)

(Eighth Amendment of the Constitution); Si/kwood v. Kerr-

McGee, 464 U.S. 238 (1984) (Atomic Energy Act); Smith v.

Wade, 461 U.S. 30, 36 n. 5 (1983) (Civil Rights Act).

The Warsaw Convention does not bar punitive damages

any more than they do.

As this Court observed in Haslip:

[T]he common-law method for assessing punitive dam-

ages was well established before the Fourteenth Amend-

ment was enacted. Nothing in that Amendment’s text or

history indicates an intention on the part of its drafters

to overturn the prevailing method.

113 L. Ed. at 20.

These decisions recognize punitive damages as a long estab-

lished and integral part of tort remedies in common law

countries. Pacific Mutual v. Haslip, 113 L. Ed. 2d at 18-20

(common law punitive damages have existed in England and

the United States for over two hundred years). Browning-

Ferris v. Kelco Disposal, 492 U.S. at 278 n 24 (punitive dam-

ages are a principle of ‘‘long standing’’ in the United States).

This Court has also ruled that a treaty may not overturn

existing common law remedies absent clear and express lan-

guage. Guaranty Trust v. United States, 304 U.S. 126, 143

(1938); see, Robert C. Herd & Co. v. Krawill Machinery, 359

U.S. 297, 304 (1959) (‘‘No statute is to be construed as alter-

ing the common law, farther than its words import.’’); Trans

World Airlines v. Franklin Mint, 466 U.S. 243, 252 (1984)

(the treaty’s monetary damage limit could not be overturned

in the face of ‘‘ambiguous congressional action . . .”’ and

‘*[legislative silence’’).

No treaty provision bars punitive damages. The court

below acknowledged that ‘‘the Convention is silent on this

subject’’ (A6; 928 F.2d at 1270, infra). Moreover, Article 24

refers damages issues to local law. See Section II F., infra.

This Court recently held that common law should be con-

sidered in interpreting the Warsaw Convention. Eastern Air-

lines v. Floyd, 499 U.S. , 113 L. Ed. 2d 569, 583 (1991)

(Court relied on ‘‘the unavailability of compensation for

purely psychic injury in many common and civil law coun-

tries at the time of the Warsaw Conference’’).

The treaty was drafted with common law participants

England and Australia, and with the United States present as

an observer. Common law punitive damages were recoverable

in England and Australia, along with the United States, for

many years prior to and at the time of the 1929 Convention.

Pacific Mutual v. Haslip, 113 L. Ed. 2d at 18-20, 24-25;

Browning-Ferris v. Kelco Disposal, 492 U.S. at 278, n.24.

Given that the treaty was drafted to apply in common law

as well as civil law countries, it was unreasonable for the Sec-

ond Circuit to conclude that- Warsaw’s drafters intended a

punitive bar absent a specific provision. Indeed, the court

below ignored basic principles of construction by ascribing to

Warsaw’s drafters an intent to bar punitive damages because

of their silence on the subject. Thus, the Second Circuit said

a es

that ‘‘[t]he drafters’ silence on this subject leads logically to

the assumption that punitive damages were not addressed

because they were never contemplated.’’ (A41; 928 F.2d at

1284). The conclusion is not warranted.

B. Article 24 preserved common law punitive damage awards

The drafters of the Convention were unsuccessful in reach-

ing agreement on uniform damage elements. International

Conference on Private Aviation Law (Paris 1926) (‘‘it is

impossible to set in a single formula the various legal con-

cepts of the various States . . .’’); Report of Henri DeVos,

CITEJA Reporter (September 1928), translated and reprinted

in Second International Conference on Private Aeronautical

Law, p. 255 (R. Horner & D. Legrez trans. 1975) (hereinafter

Warsaw Minutes) (CITEJA concluded that ‘‘[i]t was not pos-

sible to find a satisfactory solution’’ to the question of what

damages are ‘‘subject to reparation’? and agreed that the

issue ‘‘should be regulated independantly from the present

Convention.’’).

Article 24 provided that the Convention applied ‘‘without

prejudice’’ to the ‘‘respective rights’’ of the plaintiffs:

any action for damages, however founded, can only be

brought subject to the conditions and limits set out in

this convention . . . without prejudice to the questions

as to who are the persons who have the right to bring

suit and what are their respective rights. (Emphasis

added).

The ‘‘rights’’ preserved by Article 24 are the elements of

damages. See Section II(F), supra.

The court below conceded that pursuant to Article 24 ‘‘the

Convention leaves the measure of damages to the internal law

of parties to the Convention’’. (A37; 928 F.2d at 1283). Nev-

ertheless, the court failed to apply the Convention’s ‘‘without

prejudice’’ to plaintiffs’ ‘‘rights’’ provision to common law

punitive damages.

The only uniform damages provision was the treaty’s cen-

tral limitation provision: Article 22’s monetary limitation.

The drafters were satisfied to leave damages questions to

local law, provided that ‘‘any action for damages, however

founded . . .’’ were subject to the treaty’s monetary damage

limit. Drion, Limitation of Liability in International Air

Law, 135-6 (Martinus Nijhoff 1954); Calkins, The Cause of

Action under the Warsaw Convention, 26 J. Air L. & Com.

323, 342 (1959) (‘The need for uniformity does not apply to

the question of what constitutes ‘damage.’ The Convention is

silent on this point.’’).

The decision below establishes a non-uniform double stan-

dard. The damage awards of common law plaintiffs are

restricted.'* But plaintiffs in civil law nations may recover all

available local law damages, including moral damages, which

encompass a punitive element since they are based in part on

the defendant’s degree of fault. International Encyclopedia of

Comparative Law, Vol. XI, pp. 9-11-9-13; Mazeaud & Tunc,

Traité de la Responsibilité Civile 391, 396 (Sth Edition 1957)

(in France, moral damages are recoverable, and one factor in

setting the award is the defendant’s degree of fault); Tunc &

McGregor, Jnternational Encyclopedia of Comparative Law,

Vol. XI, pp. 9-12-9-13 (under German law, the tortfeasor’s

degree of fault is routinely considered to increase compensa-

tory damage awards.).

C. Article 17 establishes the conditions for airline liability

and does not bar punitive damages

Article 17 provides that ‘‘[t]he carrier shal] be liable for

damage sustained in the event of death . . . of a passenger

. . . but does not define recoverable damages. Miller, Lia-

bility in International Air Transport 125 (Kluwer 1977)

(‘‘Article 17... did not purport to regulate the type of

damage which could be compensated.’’); Haanappel, The

Right to Sue in Death Cases under the Warsaw Convention,

14 Warsaw signatories Australia, Canada and the United States allow

the recovery of common law punitive damages without limitation.

Browning-Ferris v. Kelco Disposal, 492 U.S. at 273 n.18 (1989). In

1964, thirty-five years after the Warsaw Conference, England imposed

restrictions on punitive damages, but did not completely bar recovery.

Ibid. Rookes v. Barnard, (1964] A.C. 1129, 1 All E.R. 367 (H.L.).

6 Air. L. 66 (1981) (‘‘the Convention provides neither for a

substantive rule of law nor for a choice of law rule. . . for

the meaning of the word ‘damage’ in Article 17. . .’’).

The purpose of Article 17 was to establish the conditions

precedent which trigger an airline’s liability under the Con-

vention. Air France v. Saks, supra, 470 U.S. at 397 (‘‘Article

17 establishes the liability of international air carriers for

harm to passengers’’). These conditions are: the death,

wounding or bodily injury to a passenger; an accident which

caused the damage; and such accident taking place on board

the aircraft or in the course of aay of the operations of

embarking or disembarking. Once Article 17’s conditions are

met, ‘‘the carrier’s liability is engaged’’ and ‘‘the normal

rules governing damages apply; they have not been affected

by the Convention.’’ Miller, Liability in International Air

Transport 125-6 (Kluwer 1977).

The Second Circuit, below, held that Article 17’s imposi-

tion of liability on airlines for ‘‘damage sustained’’ consti-

tuted a punitive damage bar because ‘‘Article 17

contemplates monetary or compensatory damages only’’

(A32; 928 F.2d at 1281). But Article 17 is affirmative, grant-

ing the passenger a quid pro quo for the treaty’s monetary

damage limit. The text does not suggest that Article 17

favored the carrier with a punitive damage bar.

Indeed, in the discussions at the Warsaw Conference and

CITEJA meetings concerning Article 17 and its predecessor

articles, no mention was ever made of specifying, confining

or eliminating any damage element. Warsaw Minutes, supra

at 166-7, 255.

In fact, in Smith v. Wade, 461 U.S. 30 (1983), this Court

rejected similar arguments that the phrase ‘‘for redress’’ in 42

U.S.C. § 1983 ‘‘means that Congress intended to limit recov-

ery to compensatory damages.’’ Jd. at 36, n.5. This Court

found such a construction was ‘‘strained’’ and ruled that

punitive damages were recoverable under the statute. J/bid.

Likewise, in Silkwood v. Kerr-McGee, 464 U.S. 238 (1984),

this Court rejected claims that the Atomic Energy Act, which

imposed a monetary cap on recoveries against nuclear plant

operators, barred state law punitive damages.

Similarly this Court should reverse the decision below inso-

far as it reads into the words ‘‘damage sustained’’ a bar of

punitive damages.

CERTIORARI SHOULD BE GRANTED BECAUSE

IMPORTANT QUESTIONS OF TREATY INTERPRETA-

TION ARE INVOLVED

This Court has recognized the importance of issues involv-

ing treaty interpretation in its certiorari decisions including

numerous cases involving the Warsaw Convention itself.

This Court has said:

The object of our granting writs of certiorari on points

of statutory or treaty interpretation is to determine the

correctness of fundamental points that lower courts have

resolved .... Chan v. Korean Air Lines, 490 U.S.

122, 134 n.5 (1989) (interpretation of Warsaw Conven-

tion).

We granted certiorari . . . to interpret this important

treaty provision. . . . State of Washington v. Washing-

ton State Commercial Passenger Fishing Vessel Ass’n.,

443 U.S. 658, 674 (1979) (treaties relating to fisheries).

We granted certiorari because the cases involve impor-

tant rights asserted in reliance upon federal treaty obli-

gations. Kolovrat v. Oregon, 366 U.S. 187, 191 (1961).

Certiorari has been granted to review interpretations of the

Warsaw Convention. Eastern Airlines v. Floyd, 499 U.S.

___., 113 L. Ed. 2d 569, 111 S. Ct. 1489 (1991); Chan v.

Korean Air Lines, 490 U.S. 122, 127 (1989); Air France v.

Saks, 470 U.S. 392 (1985); Trans World Airlines v. Franklin

Mint Corp., 466 U.S. 243 (1984); Lisi v. Alitalia, 390 U.S.

455 (1968).

This Court has also recognized the importance of punitive

damages in granting certiorari. City of Newport v. Facts

Concerts Inc., 453 U.S. 247, 255, 257 (1981).

CONCLUSION

Certiorari should be granted to address the conflict among

the courts on the issue of preemption of state causes of

action by the Warsaw Convention and to address important

questions of treaty interpretation coacerning the recoverabil-

ity of punitive damages in an action governed by the Warsaw

Convention when allowed under local law.

Respectfully submitted,

PLAINTIFFS’ STEERING

COMMITTEE

Karachi Hijacking

MARC S. MOLLER

Lead Counsel

KREINDLER & KREINDLER

100 Park Avenue

New York, New York 10017

(212) 687-8181

Daniel C. Cathcart

Wm. Marshall Morgan

On the Petition:

LEE S. KREINDLER

MARC S. MOLLER

STEVEN R. POUNIAN

JAMES P. KREINDLER

DANIEL M. KOLKO

PLAINTIFFS’ COMMITTEE

Lockerbie Disaster

LEE S. KREINDLER

Chairman and Counsel of

Record

KREINDLER & KREINDLER

100 Park Avenue

New York, New York 10017

(212) 687-8181

Michel F. Baumeister

Richard E. Brown

Stanley M. Chesley

Nicholas Gilman

Frank H. Granito, Jr.

APPENDIX

INDEX TO APPENDIX

PAGE

Opinion of Court of Appeals for the Second Circuit

dated March 22, 1991 and reported at 928 F.2d 1267

Sere reer rer err reer eer eee Te Al

)

Memorandum Opinion and Order of United States Dis-

trict Court for the Eastern District of New York

dated January 3, 1990 and reported at 733 F. Supp.

ES Tee TTT TTT eT ToT TT eee Bl

Memorandum Opinion and Order of United States Dis-

trict Court for the Southern District of New York

dated January 18, 1990 and reported at 729 F. Supp.

es UNS 5 a6 dev oy Boe 84 0a oO ee Cl

)

Order of Court of Appeals for the Second Circuit

EO OO vk ad ne chee hee be baaneaceeeud D1

| Judgment of Court of Appeals for the Second Circuit

2h. BOE 6 cos cosa kb ees dk eae da we ed os El

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

No. 269—August Term 1990

(Argued October 1, 1990 Decided March 22, 1991)

Docket No. 90-7388

—

IN RE: AIR DISASTER AT LOCKERBIE, SCOTLAND

ON DECEMBER 21, 1988

DENICE- H. REIN, et al.,

Plaintiffs-A ppellants,

PAN AMERICAN WORLD AIRWAYS INCORPORATED,

Defendant-A ppellee.

No. 460—August Term 1990

(Argued October I, 1990 Decided March 22, 1991)

Docket No. 90-7636

IN RE: HIJACKING OF PAN AMERICAN WORLD AIR-

WAYS, INC. AIRCRAFT AT KARACHI INTERNA-

TIONAL AIRPORT, PAKISTAN ON SEPTEMBER 5,

1986

DILIP JOSHI, NADYA HUSSAIN, TAHRA LODHI,

DILIP PARIKH, FARAIDOON OSHTORY, et al.,

Plaintiffs-A ppellees,

—_—yV.—

PAN AMERICAN WORLD AIRWAYS, INC.,

Defendant-A ppellant.

Before:

CARDAMONE and MINER, Circuit Judges

and POLLACK, District Judge*

—

Pan American World Airways, Inc., appeals from the

January 18, 1990 memorandum opinion and order of

United States District Court for the Southern District of

New York (Sprizzo, J.) denying partial summary judg-

ment on defendant Pan American’s motion to dismiss

plaintiffs’ claims for punitive damages.

Reversed and punitive damages claims dismissed.

Denice Rein, et al. appeal from the January 3, 1990

memorandum opinion and order and from the February

26, 1990 memorandum of the United States District

Court for the Eastern District of New York (Platt, C.J.)

granting partial summary judgment in favor of defen-

dant Pan American World Airways, Inc., and dismissing

plaintiffs’ punitive damage claims.

Affirmed.

—

° Honorable Milton Pollack, United States District Court for the

Southern District of New York, sitting by designation.

90-7388

LEE S. KREINDLER, Chairman, Plaintiffs’

Committee, New York, New York

(Steven R. Pounian, James P. Kreindler,

Michael F. Baumeister, Richard E.

Brown, Stanley M. Chesley, Nicholas

Gilman, Frank H. Granito, Jr.,

Kreindler & Kreindler, New York, New

York, of counsel), for Plaintiffs-

Appellants.

RICHARD M. SHARP, Washington, D.C.

(Frederick C. Schafrick, Elizabeth M.

Brown, Shea & Gardner, Washington,

D.C.; James M. Shaughnessy, Windels,

Marx, Davies & Ives, New York, New

York; Condon & Forsyth, New York,

New York, of counsel), for Defendant

Appellee.

James E. Landry, George S. Lapham, Jr.,

David A. Berg, Air Transport Associa-

tion of America, Washington, D.C.,

filed a brief Amicus Curiae.

90-7636

LEE S. KREINDLER, Chairman, Plaintiffs’

Committee, Lockerbie Disaster, New

York, New York (Steven R. Pounian,

James P. Kriendler, Michael F.

Baumeister, Richard E. Brown, Stanley

M. Chesley, Nicholas Gilman, Frank H.

Granito, Jr., Kreindler & Kreindler,

New York, New York, of counsel; Marc

S. Moller, Lead Counsel, Plaintiffs’

Steering Committee, Karachi Hijacking,

Daniel C. Cathcart, Wm. Marshall Mor-

gan, Kreindler & Kreindler, New York,

New York, of counsel), for Plaintiffs-

Appellees.

RICHARD M. SHARP, Washington, D.C.

(Frederick C. Schafrick, Elizabeth M.

Brown, Shea & Gardner, Washington,

D.C.; James M. Shaughnessy, Windels,

Marx, Davies & Ives, New York, New

York, of counsel), for Defendant-

Appellant.

CARDAMONE, Circuit Judge:

A single question of law is raised on appeals from two

district court orders: one involves the crash of Flight 103

over Lockerbie, Scotland; the other a hijacking in Kara-

chi, Pakistan.

The Lockerbie case arose from the terrorist bombing

of Pan Am Flight 103 from London to New York on

December 21, 1988. The surviving relatives and personal

representatives of those who died sued Pan American

World Airways, Inc. (Pan Am), two Pan Am subsidiary

corporations that provided security services, and Pan

Am’s parent corporation. All actions were consolidated

in the Eastern District of New York by order of the

Judicial Panel on Multidistrict Litigation. On June 2,

~ 1989 Pan Am moved for partial summary judgment on

the punitive damages claims, asserting they were barred

by the Warsaw Convention.’ For purposes of Pan Am’s

motion, the district court presumed that the carrier com-

mitted willful misconduct, and that the applicable local

law permitted the recovery of punitive damages. On

January 3, 1990 the Chief Judge of the Eastern District

(Platt, C.J.) granted partial summary judgment and dis

missed the punitive damages claims. On February 26,

1990 Chief Judge Platt entered a second memorandum

and order denying plaintiffs’ motion for reargument,

but granting certification under 28 U.S.C. § 1292(b) for

immediate appeal of the case to this Court as one

involving a controlling question of law.

The Karachi case arose from a terrorist hijacking of

Pan Am Flight 73 from Bombay, India, to New York,

stopping at Karachi and Frankfurt on September 6,

1986. The surviving relatives and personal representa-

tives of those killed sued Pan Am, and the actions were

consolidated in the Southern District of New York by

order of the Judicial Panel on Miultidistrict Litigation.

The district court (Sprizzo, J.) denied Pan Am’s motion

for partial summary judgment on the issue of whether

Pan Am had committed willful misconduct, as well as

Pan Am’s later motion for partial summary judgment

seeking to dismiss plaintiffs’ claims for punitive dam-

ages.

None of the parties dispute that these cases are gov-

erned by the Warsaw Convention and by the Montreal

l Convention for the Unification of Certain Rules Relating to Interna-

tional Transporiation by Air, done at Warsaw, Oct. 12, 1929, 49 Stat.

3000, T.S. No. 876, 137 L.N.T.S. 11, reprinted at 49 U.S.C. app.

§ 1502 note, Warsaw Convention (1988).

Accord.’ The issue presented is independent of any fac-

tual situation. We must decide whether a plaintiff may

state a claim for punitive damages in a wrongful death

action governed by the Warsaw Convention, assuming

the carrier committed willful misconduct. Although the

Convention is silent on this subject and the lack of legis-

lative materials addressing the issue makes interpreting

the Convention’s effect on punitive damages claims dif-

ficult, we are persuaded that the purposes for which the

Convention was created are not consistent with an

award of punitive damages. Thus, we hold that these

plaintiffs may not recover such damages.

So much has been written concerning the Convention

Since its adoption over 50 years ago that we must take

care not to get lost in a wilderness of words. To that

end we think it helpful to set forth the analytical frame-

work for the discussion that follows. We discuss first

the Convention’s purposes, structure and history. (I).

Then, in order to clearly identify what the term ‘‘puni-

tive damages’’ means in the context of our consideration

of the Convention, we focus analysis by exploring ini-

tially the role of punitive damages in American law gen-

erally, examining the nature of the recovery permitted

under state and federal law; and, after that, by deciding

whether the Convention provides an exclusive cause of

action or whether it permits separate state law actions

claiming punitive damages. (II). We conclude that the

2 Agreement Relating to Liability Limitations of the Warsaw Conven-

tion and Hague Protocol, Agreement CAB 18900, Approved by Execu-

tive Order E-23680, May 13, 1966 (Docket 17325) (1966), reprinted in

Civil Aeronautics Board, Aeronautical Statutes and Related Materia!

515-16 (1974) (Montreal Agreement). The Montreal Agreement raised

the amounts recoverable under the Warsaw Convention and its Proto-

cols for passengers on international flights with departure or destina-

tion points in the United States to $75,000.

Convention preempts state causes of action because dif-

ferences in the various state laws—some of which view

punitive damages as penal in nature, some compensa-

tory, and some both—would introduce such great confu-

sion into this subject as to destroy any hope of

uniformity in applying the Convention. The Convention

therefore bars state wrongful death actions in cases aris-

ing under it. (III).

We next hold that because air carrier liability is a

uniquely international problem requiring uniform inter-

pretation, the Convention must be interpreted according

to federal common law. We adopt the federal common

law of torts to construe the Convention and determine

that federal common law does not contemplate a com-

pensatory element in a punitive damages claim. (IV).

Having identified the governing law and the nature of

punitive damages potentially available under that law,

we turn to the Convention to see whether it allows for

the kind of punitive damages available to plaintiffs

under federal iaw. Our analysis of the Convention

reveals that Article 17 did not contemplate air carrier

liability for that type of punitive damages; Article 24

does not preserve such liability under local law; and the

Convention does not permit the sort of punitive dam-

ages available under federal law to be awarded, even

when the liability limitations are lifted under Article 25

in cases of willful misconduct. (V). Finally, we believe

policy considerations that led the various contracting

parties to adhere to the Warsaw Convention strongly

militate against recognition of punitive damages. (VI).

I PURPOSES, STRUCTURE AND HISTORY

OF THE WARSAW CONVENTION

The Warsaw Convention was drafted when the airline

industry was in its infancy. It was the product of two

international conferences—the first held in Paris in 1925

and the second in Warsaw in 1929—and four years of

work by the interim Commité International Technique

d’Experts Juridique Aériens (CITEJA) formed at the

Paris Conference. The Convention had two primary

goals: first, to establish uniformity in the aviation indus-

try with regard to ‘“‘the procedure for dealing with

claims arising out of international transportation and

the substantive law applicable to such claims,’’ as well

as with regard to documentation such as tickets and

waybills; second—clearly the overriding purpose—to

limit air carriers’ potential liability in the event of acci-

dents. Lowenfeld & Mendelsohn, The United States and

the Warsaw Convention, 80 Harv. L. Rev. 497, 498-99

(1967) (Lowenfeld & Mendelsohn); Block v. Compagnie

Nat’! Air France, 386 F.2d 323, 327 (Sth Cir. 1967),

cert. denied, 392 U.S. 905 (1968).

The liability limit was believed necessary to allow air-

lines to raise the capital needed to expand operations

and to provide a definite basis upon which their insur-

ance rates could be calculated. Lowenfeld & Men-

delsohn, at 499-500; H. Drion, Limitation of Liabilities

in International Air Law 16 (1954) (Drion, Limitation of

Liabilities); Floyd vy. Eastern Airlines, Inc., 872 F.2d

1462, 1467 (llth Cir. 1989), cert. granted, 110 S. Ct.

2585 (1990). The nations drafting this provision had a

direct interest in establishing liability limits since nearly

all existing airlines were either owned or heavily subsi-

dized by the various contracting states. The drafters also

believed that a liability limit would lessen litigation. Sen.

Comm. on For. Relations, Message from the President

of the United States Transmitting a Convention for the

Unification of Certain Rules, Sen. Exec. Doc. No. G,

73d Cong., 2d Sess. 3-4 (1934) (Secretary of State Cor-

dell Hull).

To effect these purposes, the Convention adopted a

trade-off between carriers and their passengers: passen-

gers would have the absolute right to compensation for

injuries up to 125,000 Poincare francs, (Articles 17,

22(1)), unless the carrier could prove it had taken all

necessary measures to avoid the damages (Article 20(1!)).

Passengers could claim no damages above the 125,000

franc limit unless they demonstrated that the carrier had

engaged in willful misconduct, in which case the Con-

vention’s limits on carrier liability would be lifted

(Articie 25). While later agreements such as the 1966

Montreal Accord somewhat modified this scheme, so

that in some cases the liability limit is higher and the

carrier may no longer raise the defense that it took all

necessary measures, see Lowenfeld & Mendelsohn at

596-600, the basic structure of the Convention remained

the same.

The Convention entered into force in February, 1933

and by the end of that year most European nations were

members. Although the United States had not partici-

pated in the work of CITEJA and only sent an observer

to Warsaw, it moved quickly thereafter, depositing its

instrument of adherence on July 31, 1934. President

Roosevelt proclaimed the Treaty 90 days later. Lowen-

feld & Mendelsohn, at 501-02.

The nature of the Convention can be identified to

some extent from the fact that the Convention’s struc-

Al0

ture clearly derives from the civil law of contracts.

Calkins, The Cause of Action Under the Warsaw Con-

vention, 26 J. Air L. & Com. 217, 223 (1959) (Calkins,

The Cause of Action). The liability regime established

by the Convention is very similar to the French law of ©

contractual liability for domestic carriers. G. Miller,

Liability in International Air Transport 234 (1977). For

example, the French law of contract implies a ‘‘stipula-

tion pour autrui’’ in contracts of carriage, allowing a

decedent’s relatives to bring an action in damages

against the carrier without having to prove the carrier’s

negligence, but subjecting the plaintiffs to any limitation

or exclusion clauses contained in the contract. Jd. at

236-37; A. Lowenfeld, Aviation Law § 1.52, at 7-17.

German law is similar. Jd. § 1.53, at 7-21 to -23.

Article 25 of the Convention, which lifts the liability

limitation in cases of willful misconduct, also derives

from the basic civil law principle that ‘‘{n]o one can

escape the consequences of one’s dol, or intentional

fault.’’ Miller, Liability in International Air Transport

at 73. This principle was often ‘‘extended to cases of

gross negligence (faute lourde),’’ id., and the Conven-

tion deliberately allows common law countries to subject

air carriers to unlimited liability in cases of willful mis-

conduct. Jd. at 80. Before turning to the text of the

Convention, we direct our attention to the role of puni-

tive damages in American law in order to identify

clearly what kinds of damages the Warsaw Convention

might bar.

II PUNITIVE DAMAGES IN AMERICAN LAW

The parties in the suits before us contend ihat puni-

tive damages are everything from damages meant to

All

compensate certain types of injuries to damages meant

purely to punish the tortfeasor. To explore fully the

nature of the recovery permitted under state and federal

law, we must keep in mind that punitive damages derive

their meaning depending on whether federal law or a

given state law, such as Massachusetts, New Hampshire

or Connecticut, governs. Here the plaintiffs in each case

“have asserted both federal and state law causes of

action.

Punitive damages have historically played a role in the

’ American common law of tort. See Smith v. Wade, 461

U.S. 30, 35 & n.3 (1983); Belli, Punitive Damages: Their

History, Their Use and Their Worth in Present-Day

Society, 49 UMKC L. Rev. 1 (1980) (Belli, Punitive

Damages). In the early case of Day v. Woodworth, 54

U.S. (13 How.) 363 (1851), the Supreme Court recog-

nized the existence and propriety of punitive damages,

noting that it could ‘‘inflict what are called exemplary,

punitive, or vindictive damages upon a defendant, hav-

ing in view the enormity of his offence rather than the

measure of compensation to the plaintiff.’’ Jd. at 370-

71. Punitive damages have had a hazy history—

sometimes used to punish, and sometimes used to

compensate a plaintiff for injuries to pride, dignity, or

reputation that would not otherwise be compensated

through traditional tort awards intended to make a

plaintiff whole. Today the Supreme Court views puni-

tive damages as penal rather than compensatory. See

Browning-Ferris Indus. v. Kelco Disposal, Inc., 109 S.

Ct. 2909, 2932 (1989) (O’Connor, J., concurring, in

part, and dissenting, in part) (citing numerous Supreme

Court cases recognizing the penal nature of punitive

damages). It has characterized these damages as private

fines used to punish a defendant’s reprehensible conduct

Al2

and to deter its repetition. See International Bhd. of

Elec. Workers v. Foust, 442 U.S. 42, 48 (1979).

Lower federal courts and a majority of state courts

have also held that punitive damages are penal, rather

than compensatory, in nature. See Floyd, 872 F.2d at

1486 (‘‘Punitive damages are intended to penalize the

wrongdoer in order to benefit society’’); Harpalani v.

Air-India, Inc., 634 F. Supp. 797, 799 (N.D. Ill. 1986)

(purpose of punitive damages is to punish and deter);

Andor v. United Air Lines, Inc., 303 Or. 505, 511-13,

739 P.2d 18, 22-23 (Or. 1987) (aim of punitive damages

is punishment, deterrence of defendant and others from

engaging in tortious conduct, and vindication of social

norms). See also, Restatement_(Second) of Torts § 908

(punitive damages are ‘‘damages, other than compensa-

tory or nominal damages, awarded against a person to

punish him for his outrageous conduct and to deter him

and others like him from similar conduct in the

future’’); Kenney, Punitive Damages in Aviation Cases:

Solving the Insurance Coverage Dilemma, 48 J. Air L.

& Com. 753, 755 (1983).

A minority of state courts view punitive damages as

serving a compensatory function. See Peisner v. Detroit

Free Press, 242 N.W.2d 775, 780 (Mich. Ct. App. 1976)

(purpose of punitive damages not to punish defendants

but ‘‘to fully compensate the plaintiffs for the injury

suffered by them because of the defendants’ actions’’);

Kelsey v. Conn. State Employees Ass’n., 427 A.2d 420,

425 (Conn. 1980); Bixby v. Dunlap, 56 N.H. 456 (N.H.

1876); Eshelman v. Rawalt, 131 N.E. 675, 677-78 (Ili.

1921); Belli, Punitive Damages, at 6. These damages are

either given ‘‘on the theory that the injury is greater,

and the actual damages are increased, by reason of the

Pier iain.

Al3

aggravating circumstances’’ of the tort or to compensate

the plaintiff for litigation costs. 22 Am. Jur. 2d Dam-

ages § 735 (1988). This view of punitive damages existed

in New Hampshire and Michigan when the United States

first adhered to the Warsaw Convention in 1934.

In some states, ‘‘exemplary damages may properly

partake of both a punitive and a compensatory charac-

ter.”’ Id. § 733; C. McCormick, Damages, § 78, at 279

(1935). We noted, for example, in Racich v. Celotex

Corp., 887 F.2d 393, 397 (2d Cir. 1989), that New York

has viewed punitive damages ‘‘as having a purpose

beyond punishment, ‘afford[ing] the injured party a per-

sonal monetary recovery over and above compensatory

loss.’ ’’ Id., citing Wittman vy. Gilson, 70 NY2d 970, 972

(1988).

III PREEMPTION OF STATE LAW

CAUSES OF ACTION

It follows from the preceding discussion that were we

to hold that plaintiffs could bring state law causes of

action, then such a cause of action for punitive darnages

would sometimes include a compensatory element. On

the other hand, if the federal cause of action is exclu-

sive, then we would look to federal law to decide

whether that body of law—which generally recognizes

no compensatory element in punitive damages claims—

would allow such a claim.

A. Current Second Circuit Law

We have left open the question of whether state

causes of action are still available under the Convention.

As the law in this Circuit now stands, we have ruled

Al4

that the Warsaw Convention creates a cause of action

enabling a plaintiff to sue directly under its terms. See

Benjamins v. British European Airways, 572 F.2d 913,

919 (2d Cir. 1978), cert. denied, 439 U.S. 1114 (1979).

This holding reversed prior cases that had held the Con-

vention created only a presumption of liability, not a

cause of action. See Komlos v. Compagnie Nationale

Aire France, 209 F.2d 436 (2d Cir. 1953), cert. denied,

348 U.S. 820 (1954); Noel v. Linea Aeropostal Venezo-

lana, 247 F.2d 677 (2d Cir.), cert. denied, 355 U.S. 907

(1957).

Benjamins left open the question of whether state

causes of action were still available under the Conven- |

tion, and only two of our cases have touched on this

subject. See In Re Air Crash Disaster at Warsaw,

Poland, on March 14, 1980, 705 F.2d 85 (2d Cir.)

(affirming on other grounds district court decision that

regarded the cause of action under the Convention as

exclusive, without discussing exclusivity issue), cert.

denied, 464 U.S. 845 (1983); cf. Tokio Marine & Fire

Ins. Co. v. McDonnell Douglas Corp., 617 F.2d 936,

941-42 (2d Cir. 1980) (postulating in dicta that action

under the Convention might not be exclusive). The

Supreme Court has declined to address the question of

exclusivity. See Air France v. Saks, 470 U.S. 392, 408

(1985). We consider the issue an open question.

B. Preservation and Preemption

The issue is not whether the Convention preempts

state laws with which it is in direct conflict, as it obvi-

ously must under the Supremacy Clause of the United

States Constitution. See U.S. Const. art. VI. Nor is it

whether a plaintiff may bring a state cause of action

Al5

when the claim does not arise under the Warsaw Con-

vention, which a plaintiff plainly may institute. See

Abramson v. Japan Airlines Co., 739 F.2d 130, 134 (3d

Cir. 1984), cert. denied, 470 U.S. 1059 (1985): Tokio

Marine, 617 F.2d at 941-42. Instead, the question we

must decide is whether state causes of action are pre-

empted when the state claim alleged falls within the

scope of the Convention. The answer to the question we

believe is ‘‘yes’’, for several reasons.

To begin with, although neither the Convention itself

nor any Congressional action at the time the United

States adhered to the Convention expressly preempted

state law, Boehringer-Mannheim Diagnostics, Inc. v.

Pan American World Airways, Inc., 737 F.2d 456, 459

(Sth Cir. 1984), cert. denied, 469 U.S. 1186 (1985), vari-

ous authorities support our conclusion that the Conven-

tion itself does not expressly preserve state law causes of

action either.

The question of whether the Convention provides the

exclusive liability remedy for international air carriers by

providing an independent cause of action, or whether

state law causes of action are preserved under the Con-

vention has been addressed by several courts. In

Boehringer-Mannheim, the Fifth Circuit held the Con-

vention cause of action is exclusive. Jd. at 458. Without

in-depth analysis, the court ruled that Texas law was

preempted, pointing out that an ‘‘obvious major pur-

pose of the Warsaw Convention was to secure uniform-

ity of liability for air carriers,’’ and that uniformity has

national as well as international application. Jd. at 459.

The Ninth Circuit has also rebutted the idea that a cause

of action may be founded on some law other than the

Convention, stating: ‘‘Such causes of action might, con-

Al6

sistently with the Convention, provide varying measures

of damages or varying specifications of persons entitled

to recover.’’ In Re Mexico City Aircrash of October 31,

1979, 708 F.2d 400, 414 n.25 (9th Cir. 1983).

Other contracting parties have also concluded that the

Convention cause of action is exclusive. French courts,

for example, have so decided. See Miller, Liability in

International Air Transport at 237 (French court held

plaintiffs could not avoid liability limits by renouncing

contractual rights and suing under a negligence theory).

In addition, England, Canada, and Australia have all

enacted implementing statutes that make an Article 17

action the exclusive remedy for claims governed by the

Convention. Carriage by Air Act, 1932, 22 & 23 Geo. 5,

ch. 36, § 1(4) (England); Civil Aviation (Carrier’s Liabil-

ity) Act, 1959-1973, § 12(2), 2 Austi.-Acts P. 643, 645

(1974) (Australia); Carriage by Air Act, § 2(5), Can.

Rev. Stat., ch. C-26 (1979) (Canada).

It is significant that Australia and Canada are federal

states, though Canada has ‘‘an essentially unified judi-

cial system,’’ but that these Acts have eliminated the

choice of law problems with which American courts

have struggled. Miller, Liability in International Air

Transport at 228-31. Further, other countries’ interpre-

tations of the Convention are ‘‘entitled to considerable

weight’’ by this Court. See Benjamins, 572 F.2d at 919;

see also Chan v. Korean Airlines, Ltd, 109 S. Ct. 1676,

1683 (1989); Saks, 470 U.S. at 396-97; Reed v. Wiser,

555 F.2d 1079, 1083 (2d Cir.), cert. denied, 434 U.S.

922 (1977).

Plaintiffs argue that, by use of such phrases as ‘‘the

law of the court to which the case is submitted,’’ Article

25 (limitations of liability lifted in cases of willful mis-

Al7

conduct); see Article 21 (contributory negligence),

Article 22 (periodic payments), Article 28 (procedural

questions), and Article 29 (calculation of statute of limi-

tations), the Convention left certain matters such as the

elements of damages to local law, by which the plain-

tiffs mean state law. Without delving too deeply into the

Convention at this point, we see no reason to believe

that the drafters meant to denote the laws of subdivi-

sions within nations. See Mertens v. Flying Tiger Line,

Inc., 341 F.2d 851, 855 (2d Cir.) (‘‘The basic unit of

international law is the nation-state and it is fair to

assume, absent clear indications to the contrary, that

[the Convention] was written with reference to nation-

States, not to areas and subdivisions of nation-states.’’),

cert. denied, 382 U.S. 816 (1965). As Professor Miller

points out, our ‘‘highly complex structure of political

and judicial jurisdictions . . . is specific to the United

States.’’ Miller, Liability in International Air Transport

at 232. The fact that Australia and Canada, the two

nations whose law is closest to our own, have applied a

single substantive law to actions under the Convention

supports our view that the Convention does not preserve

any state law causes of action.

We therefore decline to read into the Convention any

attempt to preserve a right to a state law cause of action

in addition to the action provided under the Convention

itself. The way the other parties have viewed the Con-

vention, its emphasis on uniformity, and the need for a

single, unified rule on such points as the recoverability

of punitive damages lead to the belief that the Conven-

tion should be interpreted as making all actions—other

than those not based on the Convention—exclusive

under it.

Al8

The next question to be answered is whether, if such

State law causes of action are not preserved by the Con-

vention, they are in fact preempted by the Convention.

The Supreme Court has set forth several routes by

which state law may be preempted. Congress may, of

course, expressly preempt state law, or it may enact a

scheme of federal legislation so pervasive that a court

may infer Congress left no room for the states to legis-

late in the area. See Schneidewind v. ANR Pipeline Co..,

485 U.S. 293, 299-300 (1988); Rice v. Santa Fe Elevator

Corp., 331 U.S. 218, 230 (1947). It may also preempt

state law when the subject matter demands uniformity

vital to national interests such that allowing state regula-

tion ‘‘would create potential frustration of national pur-

poses.”’ San Diego Bldg. Trades Council v. Garmon,

359 U.S. 236, 244 (1959); see Florida Lime & Avocado

Growers, Inc. v. Paul, 373 U.S. 132, 144 (1963). It is

under this latter doctrine that we deduce the Convention

preempts state law causes of action.

The principal purposes that brought the Convention

into being and presumably caused the United States to

adhere to it were a desire for uniformity in the laws gov-

erning carrier liability and a need for certainty in the

application of those laws. See Reed, 555 F.2d at 1090;

Sen. Exec. Doc. No. G, 73d Cong. 2d Sess. 3-4 (1934)

(Comments of Secretary of State Hull), supra. Hence,

the test to be applied is whether these goals of uniform-

ity and certainty are frustrated by the availability of

state causes of action for death and injuries suffered by

passengers on international flights. We do not see how

the existence of state law causes of action could fail to

frustrate these purposes.

Al9

C. Implications of Allowing State Law

Causes of Action

Any attempt to construe the meaning of punitive

damages under the laws of various states may easily

become mired down in a morass of conflicting rules. As

an illustration, it is settled law that when a plaintiff

brings a state wrongful death claim based on diversity

jurisdiction, a federal court must apply the choice of

law rules of the district in which the court sits, and then

the substantive law of the applicable state. Erie R.R.

Co. v. Tompkins, 304 U.S. 64 (1938); Klaxon Co. v.

Stentor Elec. Mfg. Co., 313 U.S. 487 (1941). An asser-

tion of diversity jurisdiction could result in the inconsis-

tent application of law to the claims before us. Assume

the Convention barred punitive damages meant to pun-

ish the defendant, but not those meant to compensate

the plaintiff for the additional injury stemming from the

senselessness of the accident. If a plaintiff were allowed

to bring a state law cause of action, the trial court’s

choice of law analysis might compel it to apply the law

of a state holding the minority view of punitive damages

SO as to include a compensatory element. In such event,

the compensatory element in the punitive damage claim

might not be allowed in a case choosing the law of

another state. In fact, it is quite conceivable that a trial

court would be forced to apply differing law from sev-

eral states to various plaintiffs.

Further, neither the choice of law rules nor the sub-

Stantive law itself could be predicted with any certainty.

An airline’s liability could therefore vary widely depend-

ing on where the plaintiff resided or chose to sue—

under Article 28 a suit may be brought in a court where

the carrier is domiciled or has a principal place of busi-

A20

ness, Or where the carrier has a place of business

through which the contract was made or before a court

at the place of destination.

Additionally, the existence of state law causes of

action would make the application of law to the federal

cause of action created by the Convention even more

complex. If the Convention did not bar a compensatory

element in a punitive damages claim under state law,

then in those cases involving federal claims as well as

diversity claims entailing the minority view of punitive

damages, the federal law would differ from the state

law, within the same case in federal court. This would

present the further problem of whether the trial court

should allow a plaintiff to choose between state and fed-

eral causes of action. Cf. Rhymes v. Arrow Air, Inc.,

636 F. Supp. 737, 741-42 (S.D. Fla. 1986) (when plain-

tiff had option to plead Warsaw Convention cause of

action but pleaded only state cause of action in state

court, defendants could not remove action to federal

court by raising the Warsaw Convention as a defense);

Trinh v. Citibank, N.A., 623 F. Supp. 1526, 1530 (E.D.

Mich. 1985) (suggesting that a court having both types

of jurisdiction should apply the forum state’s choice of

law rules, thereby treating the case as one arising under

diversity jurisdiction), aff’d 850 F.2d 1164 (6th Cir.

1988), cert. denied, 110 S. Ct. 2602 (1990); Jn Re

Korean Air Lines Disaster of Sept. 1, 1983, 704 F.

Supp. 1135, 1154-55 (D.D.C. 1988) (attempting to

decide whether jury trial right given to plaintiffs who

had pled a cause of action under the Convention should

also be afforded to other plaintiffs who had failed to

plead the Convention cause of action).

;

A21

There is also the possibility that state-owned airlines

would be subject to different laws than private airlines—

federal courts no longer have diversity jurisdiction over

foreign states (many of which own airlines) as

defendants—because the Federal Sovereign Immunities

Act is now the sole source of federal jurisdiction in

those circumstances. See Ruggiero v. Compania Peruana

de Vapores, 639 F.2d 872, 873-78 (2d Cir. 1981). Even

under those circumstances, the state of choice of law

analysis is currently not uniform. Compare Barkanic v.

General Admin. of Civil Aviation of the People’s

Republic of China, No. 90-7641, slip op. at 1312-1318

(2d Cir. Jan. 14, 1991) (holding that federal court must

use forum state choice of law rules under the Foreign

Sovereign Immunities Act) with Harris v. Polskie Linie

Lotnicze, 820 F.2d 1000, 1002-03 (9th Cir. 1987) (hold-

ing that federal courts should use federal common law

choice of law rules under the Foreign Sovereign Immu-

nities Act).

Of course, we might solve the general choice of law

problem presented by the Convention by adopting state

law as federal law and limiting federal law to the choice

of law issue. See, e.g., Corporacion Venezolana de

Fomento v. Vintero Sales, 629 F.2d 786, 793 (2d Cir.

1980), cert. denied, 449 U.S. 1080 (1981); Aaron Ferer

& Sons Ltd. v. Chase Manhattan Bank, 731 F.2d 112

(2d Cir. 1984). In that case, there would be consistency

between the law applicable to the federal cause of action

and the law applicable to the state cause of action.

Nonetheless, the law would still vary between states and

would also vary from one federal court to another, so

that even federal law would not be constant. Moreover,

differences might still creep in between the state and

federal causes of action in the same federal court

A22

because the federal choice of law analysis might well dif-

fer from the state choice of law analysis. See, e.g.,

Harris, 820 F.2d at 1004 & n.5 (applying federal com-

mon law choice of law rules to claim under the Foreign

Sovereign Immunities Act, with result different from

result under California choice of law rules).

In sum, the existence of the state causes of action

would not only result in the inconsistent application of

law to the same accident, but also would cause enor-

mous confusion for airlines in predicting the law upon

which they would be called to respond. It would sink

federal courts into a Syrtis bog where they would not

know whether they were at sea or on good, dry land, see

J. Milton, Paradise Lost, Book II, reprinted in 4 Har-

vard Classics, The Complete Poems of John Milton at

134 (1909), when deciding what law a plaintiff can rely

upon, what law the court itself should apply, and why.

The problem might not seem especially grave if one

looks solely to the orderliness already inherent in the

Convention’s presumption of airline liability and the

$75,000 limit on individual recovery. But this surface

unity ignores both the lurking legal chaos and the huge

expenditure of time and expense in litigation over the

choice of law, which would be inevitable if conflicting

laws from various states were available in cases of will-

ful misconduct. ‘

D. Cther Case Law

Although decisional law is divided on whether the

Warsaw Convention permits a plaintiff to bring a state

law claim otherwise governed by the Convention seeking

punitive damages, the more reasoned opinions conclude

as we do that such claims are barred by the Convention.

A23

In Harpalani, 634 F. Supp. at 799, the District Court

for the Northern District of Illinois held that allowing

punitive damage awards would be inconsistent with the

Convention’s scheme of keeping compensation at a suf-

ficiently low level to allow carriers to insure against

losses, ‘‘both because carriers cannot insure against such

awards, and because the purpose of punitive damages—

to punish and deter . . . is unrelated to the signatories’

goal of ensuring minimally adequate compensation.’’

Id., disapproved of on other grounds in Wolgel v. Mex-

icana Airlines, 821 F.2d 442, 445 (7th Cir.), cert.

denied, 484 U.S. 927 (1987).

Other courts have found this argument persuasive. In

Floyd, the Eleventh Circuit squarely held that allowing

punitive damages in an action based on state law would

“conflict with the scheme of liability provided for in the

Warsaw Convention.’’ 872 F.2d at 1485. Floyd noted

that the entire tone of the Convention appears to be

compensatory, not punitive. Jd. at 1487. It rejected the

argument that Article 25 itself created an action for

punitive damages, id. at 1483-84, and held that the Con-

vention was meant to compensate injured passengers,

not to punish airlines. Jd. at 1486. Therefore, though

the court expressly declined to address whether the Con-

vention creates an exclusive cause of action, it held that

the plaintiffs could not recover punitive damages on

their state law claims even if they could prove willful

misconduct. Jd. at 1486-89.

In re Air Crash Disaster at Gander, Newfoundland on

Dec. 12, 1985, 684 F. Supp. 927 (W.D. Ky. 1987),

reached the same conclusion. It held that ‘‘state law

claims for punitive damages are pre-empted by the Con-

vention to the extent that they would prevent the appli-

A24

cation of the Convention’s limitations.’’ Jd. at 932-33.

Cf. In Re Aircrash in Bali, Indonesia on April 22, 1974,

684 F.2d 1301, 1308 (9th Cir. 1982) (‘‘California law is

preempted by the Warsaw Convention to the extent that

California law would prevent the application of the

Convention’s limitation on liability’’).

Only two cases support the argument that punitive

damages do not conflict with the Convention’s pur-

poses: Hill v. United Airlines, 550 F. Supp. 1048, 1054-

56 (D. Kan. 1982); Jn re Korean Airlines Disaster, MDI.

565 (D.D.C. 1989), appeal docketed, No. 89-5415 (D.C.

Cir. Nov. 3, 1989). Hill stated only that the plaintiffs in

that case had properly invoked the willful misconduct

provision, which if proved ‘‘might entitle plaintiffs to

recover actual and punitive damages,’’ 550 F. Supp. at

1056, but this holding was not supported by any detailed

reasoning. The presiding judge affirmed the jury award

of punitive damages in Jn re Korean Airlines Disaster

without opinion. See Buono, The Receverability of

Punitive Damages Under the Warsaw Convention in

Cases of Willful Misconduct: Is the Sky the Limit?, 13

Fordham L. J. 570 (1990). Thus, those courts that have

carefully analyzed whether punitive damages are recov-

erable under state law claims arising under the Conven-

tion have decided they are not recoverable.

E. Analogous Supreme Court Case

Although not precisely on point, Ray v. Atlantic

Richfield Co., 435 U.S. 151 (1978), is analogous to the

issue before us. In that case, Title II of the Ports and

Waterways Safety Act of 1972 authorized the Secretary

of the Department of Transportation to issue regulations

respecting the design, construction and operation of oil

nh st aT ort ine nea

A25

tankers, in order to ensure minimum standards of vessel

safety and the protection of the marine environment. /d.

at 161. The Secretary was required tc inspect vessels and

to issue certificates of compliance allowing the ship to

carry the relevant cargo. Jd. at 162-63. Ray read this

statutory pattern as embodying Congress’ aim to impose

uniform national standards for the design and construc-

tion of oil tankers. /d. at 163-64. Among other things,

the Court noted that Congress planned to have a uni-

form set of rules in an area that had traditionally been

one in which international—rather than national—action

was preferable because of the international nature of the

problem of marine pollution. Jd. at 166. It also noted

that Congress included a provision requiring the Secre-

tary to transmit his proposed rules to appropriate inter-

national forums ‘‘for consideration as _ international

standards’’ and that several other requirements of the

Act indicated that ‘‘Congress expressed a preference for

international action.’’ Jd. at 167. The Supreme Court

ruled therefore that the Act

leaves no room for the States to impose different or

stricter design requirements than those which Con-

gress has enacted with the hope of having them

internationally adopted or has accepted as the result

of international accord. A state law in this area

would frustrate the congressional desire of

achieving uniform, international standards and is

thus at odds with ‘the object sought to be obtained

by [Title II] and the character of obligations

imposed by it... .’

Id. at 168 (quoting Rice, 331 U.S. at 230).

Similarly, by adhering to the Convention, Congress

expressed a preference for_uniform, international rules.

A26

The Convention also operates in an area in which such

rules are required due to the international nature of the

problem of carrier liability. State statutes governing

wrongful death actions differ significantly as to the ele-

ments, measure, and distribution of damages. See | S.

Speiser, Recovery for Wrongful Death § 1.9 at 29 (2d

ed. 1975). The existence of differing laws in various

States—particularly respecting punitive damages—would

frustrate the Convention’s aims of uniformity and cer-

tainty in the application of those international rules.

In sum, allowing each of the individual states to pre-

scribe the elements of damage claims governed by the

Convention would, as discussed above, ‘‘create potential

frustration of national purposes.’’ San Diego Building

Trades Council, 359 U.S. at 244. We recognize there is a

general presumption against finding preemption of state

law, see Motor Vehicle Mfrs. Ass’n of United States,

Inc. v. Abrams, 899 F.2d 1315, 1319 (2d Cir. 1990), but

the existence of separate state causes of action conflicts

so strongly with the uniform enforcement of the Treaty

that in our view that presumption is overcorne.

IV FEDERAL COMMON LAW

A. Adopting Federal Common Law

Because the Warsaw Convention preempts state law

causes of action arising under it, we must next deter-

mine what law must be applied in deciding the claims

before us. We look to the source of the right in order to

determine the controlling law. See Van Gemert v. Boe-

ing Co., 553 F.2d 812, 813 (2d Cir. 1977). The source of

the right to sue under the Convention is the Convention

itself—a treaty that only the federal government has the

oes Maes tt

A27

power to make. U.S. Const. art. II, § 2, cl. 2; art. I,

§ 10, cl. 1.

Consequently, the source of the right is federal law—

in fact, uniquely federal law. It follows then the sub-

stantive law we must apply is also federal law. See

Clearfield Trust Co. v. United States, 318 U.S. 363,

366-67 (1943); Vintero Sales Corp., 629 F.2d at 795; cf.

DeMarines v. KLM Royal Dutch Airlines, 580 F.2d

1193, 1201 n.12 (3d Cir. 1978) (noting that after Ben-

jamins, when a plaintiff asserts a cause of action based

on the Convention itself, ‘‘a federal court, not sitting in

diversity, would not be bound by state substantive law

and would be free to fashion’’ applicable rules of law

*‘under federal law principles’’).

Two choices are generally available to a court in

deciding the law created by a federal cause of action:

adopting state law or creating a uniform federal com-

mon law. It would make little sense to adopt state law

when uniform interpretation of the federal law is more

consistent with the Convention’s purposes. Clearfield

Trust states that one of the primary considerations in

determining whether federal courts should fashion fed-

eral law or merely adopt state law is the degree of need

for national uniformity. Clearfield Trust, 318 U.S. at

367. Since, as a treaty, the Warsaw Convention is the

Supreme Law of the Land, U.S. Const. art. VI, cl. 2,

this federally-created cause of action should be con-

strued exclusively under federal law. See Block, 386

F.2d at 337-38 (Convention is like a ‘‘uniform law’’

within the United States and court ‘‘has an obligation to

keep interpretation as uniform as possible’’).

Other circuits agree. In Jn re Mexico City, 708 F.2d

400, the Ninth Circuit recognized the Convention’s fed-

A28

erally created cause of action and held ‘‘the questions of

who are the persons entitled to assert that cause of

action and what are their respective rights may be deter-

mined by reference to other federal statutes.’’ Jd. at

415. It left the task of determining the ‘‘most appropri-

ate analog’’ to future courts. /d. Fhe Fifth Circuit in

Boehringer-Mannheim considered whether attorneys fees

are recoverable ‘‘under federal law’’ in a Warsaw Con-

vention action. See 737 F.Zcd at 459. Citing A/lyeska

Pipeline Serv. Co. v. Wilderness Soc., 421 U.S. 240, 247

(1975), it concluded they were not recoverable under the

common law American Rule. See also In re Korean Air

Lines, 704 F. Supp. at 1154 (applying federal common

law to claim for jury trial under the Warsaw Convention

and the Death on the High Seas Act). Thus, we adopt

substantive federal common law as the law governing

the cause of action under the Warsaw Convention.

B. Nature of the Federal Cause of Action:

Tort not Contract

The next question is what is the type and content of

this substantive law. Pan Am argues that we must inter-

pret the Treaty in a manner consistent with the ‘‘shared

expectations of the contracting parties,’’ and that the

framers of the Convention intended to create a cause of

action sounding in contract. We do not doubt that the

Convention was drafted against a civil law background

that placed the cause of action in contract. See Saks,

470 U.S. at 399 (Convention was ‘‘drafted in French by

continental jurists’’); Miller, Liability in International

Air Transport, at 235; Lowenfeld & Mendelsohn, at

498-500.

)

A29

Nonetheless, the label ‘‘contract’’ is misleading, and

of little use in determining the substance of the cause of

action created by the Convention. The bodies of com-

mon and civil law of contract are not identical. Com-

mon law tends to classify damages intended to

compensate or punish as sounding in tort, and any mea-

sure of damages meant to give the plaintiff the benefit

for which he bargained as sounding in contract. Yet,

under the French law governing a contract of carriage—

which is the type of contract at issue here—the contract

‘‘can provide a basis for any action, be it wrongful

death, personal injury, delay or damage to baggage or

cargo.’’ Miller, Liability in International Air Transport

at 231. In fact, the primary result of placing the action

in contract rather than negligence in French law is that

the plaintiff need not prove negligence in order to

recover for injuries stemming from an accident. /d. at

237 & n.19; Calkins, The Cause of Action, 26 J. Air L.

& Com. at 219-20. Even the legal consequences of gross

negligence fall under the rules of contract: ‘‘[u]nlimited

liability in cases of dol or faute lourde [loosely translat-

able as gross negligence] is sometimes seen as having a

tortious nature but, more often, it is analyzed as an

aggravated liability which retains its contractual nature.

The very rule that the liability limitations are set aside is

itself considered as a rule of contractual liability.’’ Jd. at

234.

| In searching for the appropriate source from which to

draw federal common law, the closest analog is not con-

tract, but tort law, for the causes of actions the Conven-

tion preempts are the types of claims the common law

normally associates with the law of tort. Consequently,

in the absence of a specific conflict between the Conven-

tion, as interpreted in the context of the shared expecta-

A30

tions of the contracting parties, we look to the common

law of tort in order to determine the elements of the

cause of action under the Convention.

Federal common law of tort recognizes the right to a

wrongful death recovery, see Moragne v. States Marine

Lines, Inc., 398 U.S. 375, 409 (1970), and allows an

award of punitive damages, see Smith, 461 U.S. at 34-

35, but solely to punish a defendant and deter certain

kinds of conduct. See Memphis Community Sch. Dist.

v. Stachura, 477 U.S. 299, 306 & n.9 (1986). Hence,

because federal common law does not accord a right to

recover for a compensatory element in a punitive dam-

ages claim, we need only decide whether the convention

permits recovery of punitive damages to punish a defen-

dant and deter certain kinds of conduct. With the

pete inquiry thus focused, we turn now to the text of the

Convention.

V THE TREATY

Ordinarily, we would start at the outset with the text

of the Warsaw Convention in deciding whether it per-

mits an award of punitive damages. But when, as in this

case, the text does not address the question presented,

we may—as in the earlier discussion—also examine the

purposes for which the Convention came into being, its

history, the negotiations leading to its adoption, and

how the contracting parties have construed the Conven-

tion. see Saks, 470 U.S. at 396-97, 400, citing Choctaw

Nation of Indians v. United States, 318 U.S. 423, 431-32

(1943); Chan, 109 S. Ct. at 1683; Fothergill v. Monarch

Airlines Ltd., [1981] A.C. 251, [1980] 2 All. E.R. 696,

[1980] 2 Lloyd’s Rep. 295 (H.L.).

The Convention represents an entire liability scheme,

and was intended to serve as a uniform, international

A31

law. See Block, 386 F.2d at 337-38. As such, its terms

should be read in that context, see Reed, 555 F.2d at

1083, and the words used should be given ‘‘a meaning

consistent with the shared expectations of the contract-

ing parties,’’ Saks, 470 U.S. at 399, in order to more

completely effectuate the Convention’s purposes. See

Benjamins, 572 F.2d at 917-18; Eck v. United Arab Air-

lines, Inc., 360 F.2d 804, 812 (2d Cir. 1966); cf. Day v.

Trans World Airlines, 528 F.2d 31, 38 (2d Cir. 1975),

cert. denied, 429 U.S. 890 (1976). With this in mind, we

turn to the text of the relevant Articles.

A. Article 17

1. Text. The provision that establishes a _carrier’s

liability—Article 17—reads as follows in French, the

official language of the Warsaw Convention:

Le transporteur est responsable du dommage sur-

venu en cas de mort, de blessure ou de toute autre

lésion corporelle subie par un voyageur lorsque |’ac-

cident qui a causé le dommage s’est produit a bord

de l’aéronef ou au cours de toutes opérations

d’embarquement et de debarquement.

The English translation of this Article, as set forth in

the United States Code, is:

The carrier shall be liable for damage sustained in

the event of the death or wounding of a passenger

or any other bodily injury suffered by a passenger,

if the accident which caused the damage so sus-

tained took place on board the aircraft or in the

course of any of the operations of embarking or

disembarking.

49 U.S.C. app. § 1502 note.

——

A32

The parties to the present litigation agree that the

minutes and notes of the Convention shed no light on

whether the drafters contemplated that a carrier’s liabil-

ity under Article 17 was limited to compensatory dam-

ages only. Liability under Article 17 was obviously

meant to be limited to 125,000 franes by Article 22(1),

and is now limited to $75,000 by the Montreal Agree-

ment. Determining whether the Convention ever allows

a recovery Of punitive damages in cases it governs is the

subject to which this opinion is directed.

2. Examining ‘“‘dommage survenu’’. The first step in

determining whether Article 17 contemplated punitive

damages is to examine the legal meaning of the term the

Article uses, ‘‘dommage survenu’’, to see if it excludes

that possibility. See Saks, 470 U.S. at 399. Plaintiffs

argue that ‘‘du dommage survenu’’ means ‘‘damages

occurred’’ or ‘‘arrived’’ or ‘‘happened,’’ not ‘‘sus-

tained’’ and thus Article 17 contemplates punitive dam-

ages. Pan Am contends that the proper translation is

“‘sustained,’’ but that the exact translation does not

matter because punitive damages do not ‘‘happen’’ or

‘foccur’’ any more than they are sustained; rather puni-

tive damages are imposed by a jury or a court.

We are convinced that the proper translation is ‘‘dam-

age sustained’’ and deduce therefore that Article 17 con-

templates monetary or compensatory damages only. The

translation of ‘‘du dommage survenu’’ as ‘‘damage sus-

tained’’ is the one made by the State Department and

found in the United States Code, and it was the transla-

tion used in 1934 when the Convention was sent to the

Senate for ratification. In addition, two later Conven-

tions held to revise the Warsaw Convention used English

as one of the official languages and both used the

A33

‘‘damage sustained”’ translation. See Protocol to Amend

the Convention of Certain Rules Relating to Interna-

tional Carriage by Air signed at Warsaw on 12 October

1929. The Hague, Sept. 1955 (Hague Protocol); Interna-

tional Conference on Private Air Law, Guatemala City,

Sept. 1961 (Guatemala Protocol). The United States

Senate has not ratified either of these Protocols, so they

provide no binding authority, but they are nonetheless

evidence of the expectations of the contracting parties to

the Convention.

The English courts have also interpreted ‘‘dommage

survenu’’ as limited to monetary loss, see Fothergill, 2

Lloyd’s Rep. at 299 (H.L.) (Lord Wilbeforce) (‘‘in the

English text, the word ‘damage’ in the Convention is

used in more than one sense. Sometimes it means ‘mon-

etary loss’—for example in art. 17, or art. 19. Some-

times it means ‘physical damage’ e.g. art. 10.’’)

(emphasis in original). The interpretation adopted by the

English courts is entitled to some weight in our attempt

to plumb the meaning of the Convention’s ambiguous

wording. See Chan, 109 S. Ct. at 1683; Reed, 555 F.2d

at 1083; Day, 528 F.2d at 35. Moreover, the only two

American cases that appear to have discussed this issue

directly, have concluded that ‘‘dommage survenu’’ is

entirely compensatory in tone. See Floyd, 872 F.2d at

1486-89; In re Air Crash Disaster at Gander, Newfound-

land, 684 F. Supp. at 931.

Whatever the shades of meaning in the word ‘‘sur-

venu’’, we agree that the way in which the Convention

uses the term indicates that Article 17 refers to actual

harm caused by an accident rather than generalized legal

damages. The Article’s later language—‘‘subie par un

voyaguer lorsque l’accident qui a caus le dommage’”’ (lit-

A34

erally, suffered by a traveller if the accident that caused

the damage)-—supports the compensatory interpretation

of the term ‘‘du dommage survenu,’’ because an acci-

dent does not ‘‘cause’’ punitive damages. Cf. Saks, 470

U.S. at 397-400 (discussing the concept of causation in

Article !7).

The context within which the Convention was written

adds further support to the conclusion that the damages

contemplated by Article 17 are purely compensatory.

Under civil law, as noted, an action under the Warsaw

Convention sounds in contract. Punitive damages are

generally not available in civil law contract actions. In

fact, under the civil law they do not appear to be availa-

ble at all. See Cooperativa de Seguros Multiples de

Puerto Rico v. San Juan, 289 F. Supp. 858, 859-60 (D.

Puerto Rico 1968); 2 M. Planiol & G. Ripert, Treatise

On the Civil Law, Pt. 1, § 247 (trans. Louisiana St.

Inst. with the authority of Librarie Generale de Droit et

de Jurisprudence Paris, 11th Ed. 1939).

Plaintiffs nevertheless argue in support of their posi-

tion that the national laws of many of the contracting

parties allow the equivalent of punitive damages because

they weigh the degree of fault in tort actions. Conced-

edly, some civil law countries do consider the degree of

fault in assessing damages, but these damages are gener-

ally ‘‘free from punitive considerations’’ and ‘‘can be

reduced to the princip’e that plaintiff is entitled to ade-

quate compensation or satisfaction for the mental

harm.”’ Stoll, Penal Purposes in the Law of Tort, 18

Am J. of Comp. L. 3, 4 (1970) (Stoll, Pena/ Purposes).

In German law, for instance, damages may be

awarded to vindicate the puiaintiff’s ‘‘outraged sense of

justice,’’ but they are awarded to compensate the plain-

A35

tiff, mot to punish the defendant. Jd. at 4-5. French law

considers fault in those cases where it is awarding

‘‘dommage moral,’’ or moral damages, which are usu-

ally equivalent to damages for pain and suffering, grief,

shame, or disfiguration. Lowenfeld, Aviation Law,

§ 1.52 at 7-19 (2d ed. 1981); R. Mankiewicz, The Liabil-

ity Regime of the International Air Carrier 157 (1981).

Again, these damages are not intended to punish the

defendant or to deter similar conduct.

Plaintiffs’ response is that the Convention may not be

construed solely with reference to civil law because

England, a common law country, was also instrumental

in drafting it. But there is no significant difference in

wrongful death cases between the English law and the

civil law of punitive damages. Like German and French

law, English law may sometimes award aggravated dam-

ages to Satisfy a plaintiff’s sense of outrage, as in a libel

case, but damages awarded for the purpose of p inishing

the defendant have always been rare in England. See

Stoll, Penal Purposes, 18 Am. J. of Comp. L. at 45.

Further, since adhering to the Convention, England has

generally limited the recovery of punitive damages to

unique and rare circumstances. See Rookes v. Barnard,

[1964] 1 All E.R. 367, 410 (H.L.) (opinion of Lord

Devlin). Thus, none of the original contracting parties

to the Convention can reasonably be said to have shared

any expectation that Article 17 would create liability for

punitive damages.

Hence, the sum of the context in which the Article

was written, the law of the contracting parties, subse-

quent interpretations, and the historical translation

argue persuasively that Article 17 establishes liability for

compensatory damages only, and that it would be incon-

A36

sistent with the purposes of the Warsaw Convention to

read Article 17 as permitting the recovery of punitive

damages.

B. Article 24(2)

1. Text. Plaintiffs next contend that whatever the

meaning of ‘‘dommage survenu,’’ the Convention

expressly left the types of recoverable damages to local

law, in the same way that it left the question of contrib-

utory negligence and what parties could sue to local law.

This argument is based on Article 24, which states

(1) In the cases covered by articles 18 and 19 [bag-

gage claims] any action for damages, however

founded, can only be brought subject to the condi-

tions and limits set out in this convention.

(2) In the cases covered by article 17 the provisions

of the preceding paragraph shall also apply, without

prejudice to the questions as to who are the persons

who have the right to bring suit and what are their

respective rights.

49 U.S.C. app. § 1502 note.

An argument for the availability of state causes of

action under the Convention—as distinguished from the

availability of state causes of action outside the Conven-

tion, a possibility we rejected earlier—is that the lan-

guage of the Convention itself preserves them. Article

24(1) provides that ‘‘any action for damages, however

founded, can only be brought subject to the conditions

and limits’’ of the Convention. This language is subject

to two interpretations. The first is that a local cause of

action (actions ‘‘however founded’’) may be brought,

but that it is subject to the conditions and monetary lim-

A37

its of the Convention. The second interpretation is that

a plaintiff, whatever his damages, cannot circumvent the

Convention by bringing any action other than one under

Article 17.

Courts that have considered this language have not

agreed on whether the cause of action created under the

Convention was meant to be exclusive. See Floyd, 872

F.2d at 1482, n.33 (citing cases). Although the long list

of cases cited by Floyd would seem to indicate other-

wise, there is a paucity of direct authority on this ques-

tion, with only the Fifth Circuit having directly ruled on

It.

Again, plaintiffs and defendant agree there is no

drafting history to indicate that the contracting parties

intended this section to have any effect on the specific

question of whether local law should govern on the issue

of allowance of punitive damages. Plaintiffs insist that

the last part of Article 24(2), ‘‘without prejudice as to

. what are their respective rights,’’ leaves the ques-

tion of the elements of damages to local law and thereby

effectively also directs the court’s inquiry on the issue of

punitive damages to local law. Pan Am views the phrase

as intending to leave to local law only such questions as

who is a proper plaintiff and the respective rights of

beneficiaries regarding descent and distribution arising

from the death of a passenger.

Commentators and case law are in accord that the

Convention leaves the measure of damages to the inter-

nal law of parties to the Convention. See Harris, 820

F.2d at 1002 (‘‘Evidently damages are to be measured

according to the internal law of a party to the Conven-

tion’’); Mertens, 341 F.2d at 858 (‘‘It seems clear that

the Warsaw Convention left [the issue of which items of

A38

damage can be properly included in the award—e.g.

mental anguish], as it did other issues, such as who are

the proper beneficiaries of a damage award, to the inter-

nal law of the parties to the Convention.’’); Miller, Lia-

bility in International Air Transport at 117; Drion,

Limitation of Liabilities at 125-26; N. Matte, Treatise

on Air-Aeronautical Law 383 (1981). None of these

authorities seems to have considered whether the ‘‘type’’

of compensable damages left to local law could include

punitive damages. When the Harris court applied Polish

law to the calculation of damages, it did not mention

punitive damages, but only referred to the way in which

pecuniary loss, such as funeral expenses and lost finan-

cial support to the survivors, should be calculated. See

Harris, 820 F.2d at 1004-05. Nor did either of the other

courts suggest that in mentioning the ‘‘types’’ or ‘‘ele-

ments’’ of a damage award they meant anything more

than how to calculate compensatory damages.

2. Drafting History. The drafting history of Article

24 indicates that the cited clause was primarily aimed at

questions of descent and distribution. The initial draft,

prepared at the 1925 Paris conference, provided:

In case of decease of a passenger carried, the law-

Suit regarding responsibility may be taken by the

persons who have a right to take such action

according to the law of the land of the deceased

person but under the reserve of the limitation of

responsibility provided for in the foregoing article.

International Conference on Private Aviation Law

(Paris 1926) (State Department Translation) Addendum

at 12a. The accompanying official report stated that:

A39

There is a need to determine exactly the extent of

the rights of legal claimants for, depending on the

national laws, the nature of their rights could lead

to an interpretation different from the legal basis

and somehow cancel the limitation set by the pre-

liminary project. Since it is impossible to set in a

single formula the various legal concepts of the var-

ious States, it appeared simpler to specify in Article

8 that the claimants would be determined according

to the national law of the deceased, but that the

rights of these persons would be limited to the max-

imum sum allowed by Article 7.

International Conference on Private Aviation Law

(Paris 1926) Addendum at 7a.

As this report plainly states, the drafters’ primary

concern stemmed from the fact that the laws of descent

regarding a person’s ability to claim damages in a

wrongful death action vary widely according to national

laws. See Haanappel, The Right to Sue in Death Cases

under the Warsaw Convention, 6 Air. L. 66, 69-70

(1981); Mankiewicz, The Liability Regime of the Inter-

national Air Carrier at 161-66. For example, in France

the decedent’s heirs inherit the right to sue on the dece-

dent’s behalf, but close family members and even a

divorced spouse have the right to sue for personal dam-

ages. Haanappel, The Right to Sue, 6 Air L. at 73. It

was feared by the drafters that if the heirs brought a

contractual action, but those entitled to sue for personal

damages brought tort actions, the sum of the actions

might exceed the liability limit imposed by the Conven-

tion. See Drion, Limitation of Liabilities at 71-72. Thus,

in recognition of the widely varying laws of descent, the

drafters gave up any attempt to decide who could sue

A40

and on what legal basis, but instead explicitly provided

that no matter how many plaintiffs were involved or

what their rights were under local law, in no event could

the sum total of recovery exceed the Convention’s liabil-

ity limit.

A draft convention in 1928 changed the provision to

read:

In the event of death of the holder of the right, any

action in liability, however founded, can be exer-

cised ... by the persons to whom this action

belongs according to the national law of the

deceased or, in the absence hereof [sic], according

to the law of his last domicile.

CITEJA Report, 3d Session, May 1928, quoted in

Haanappel, The Right to Sue, 6 Air L. at 67. Discus-

sions held during the next two years led the drafters to

abandon the choice of 'aw rule favoring the decedent’s

domicile, thus leaving both the choice of law and the

question of the rights of legal claimants to ‘‘general

principles of private international law and to the internal

legislation of States.’’ Jd. at 67; see Drion, Limitation

of Liabilities at 126. The Final CITEJA Report drafted

by the official Reporter for the Convention, Henri

deVos, stated

The question was asked of knowing if one could

determine who are the persons upon whom the

action devolves in the case of death are, and what

are the damages subject to reparation. It was not

possible to find a satisfactory solution to this dou-

ble problem, and the CITEJA esteemed that this

question of private international law should be reg-

ulated independently from the present Convention.

A4l

Report of Henri deVos, CITEJA Reporter (September

1928), translated and reprinted in Second International

Conference on Private Aeronautical Law, p. 255 (R.

Horner & D. Legrez trans. 1975).

Nothing in this drafting history suggests that the

drafters ever considered that they might be allowing a

contracting party to impose punitive damages. DeVos’s

use of the word ‘“‘reparation’’ tends to exclude the con-

cept of punitive damages, as does the nature of the lia-

bility created by Article 17—found earlier to be purely

compensatory. Hence, the drafting history of Article 24,

together with the civil law background of the Conven-

tion, make it extremely unlikely that Article 24(2) was

intended by its drafters to preserve a common law right

tO punitive damages.

The drafters’ silence on this subject leads logically to

the assumption that punitive damages were not

addressed because they were never contemplated. The

plaintiffs maintain that the fact that the Convention

never referred to punitive damages is without signifi-

cance because the Convention left the calculation of

damages to local law, and did not need therefore to

address the subject. Yet, there can be no doubt that had

the question been raised it would have been hotly

debated, especially since the concept is unique to the

common law, and also because many of the airlines

were state-owned. Again, nothing in the Convention’s

drafting history points to the drafters contemplating that

the Convention would be used to punish or deter tor-

tious behavior on the part of airlines. Rather, all of the

drafters’ actions point to the conclusion that they sought

to limit recovery simply to compensation.

A42

3. Other Authority on Article 24. As is evident, the

case law on this topic is remarkably sparse, and what lit-

ile exists is short on analysis. Commentators also pro-

vide little help. According to the Chief United States’

delegate to the Hague Conference—a later Convention

held to modify~the liability limitations of the Warsaw

Convention—the drafters of Article 24 discussed the

possibility of tort suits. during preliminary discussions

and ‘‘no attempt was made by the framers of the Con-

vention to outlaw the right of a plaintiff . . . to bring

an action in tort.’’ Calkins, The Cause of Action, 26 J.

Air L. & Comm. at 327-28. Pan Am points out that this

conclusion was based on comments by the French dele-

gate, M. Ripert, but that the French have interpreted the

Treaty as creating an exclusive cause of action. See

Miller, Liability in International Air Transport at 237

(French court held ‘‘the convention had established a

liability regime which excluded any action based on

other principies.’’). In any event, it is possible that the

phrase ‘‘however founded’’ was simply intended to pre-

vent an injured party’s relatives from bringing an inde-

pendent action, outside the contract action which the

injured person himself might bring, for loss of support.

See Drion, Limitation of Liabilities at 71.

C. Article 25

1. Willful Misconduct. Discussion now turns to

whether punitive damage claims are contemplated by the

Convention under the willful misconduct language of

Article 25, and thus form part of the damages recover-

able under the federal action. Plaintiffs assert that even

if Article 17 does not allow recovery of punitive dam-

ages, that provision becomes inoperative in the event of

A43

the carrier’s willful misconduct under Article 25 since

the Article is then a ‘‘limitation or exclusion’’.

We conclude that Article 17 is not one of the limita-

tions or exclusions to which Article 25 refers; Article 25

voids only certain provisions in the event of willful mis-

conduct, but the rest of the Convention remains fully

operative, and the Convention as it then remains still is

inconsistent with the notion of a punitive damages

recovery. An examination of the inconsistency between

punitive damages and the accomplishment of the pur-

poses of the Convention demonstrates that the shared

expectations of the drafters did not include the recovery

of punitive damages, even in the event of willful miscon-

duct.

2. Lifting of Liability Limitations. Article 25 pro-

vides as follows:

The carrier shall not be entitled to avail himself of

the provisions of this convention which exclude or

limit his liability, if the damage is caused by his

willful misconduct or by such default on his part

as, in accordance with the law of the court to which

the case is submitted, is considered to be equivalent

to willful misconduct.

49 U.S.C. app. § 1502 note.

Plaintiffs make two related arguments in support of

their position that Article 25 allows punitive damages

claims in cases of willful misconduct. First, plaintiffs

contend that, by lifting the $75,000 limit on damages,

Article 25 lifts any and all limitations on damages. Next,

plaintiffs insist that Article 17—when read to create a

cause of action for compensatory damages and to pre-

empt pre-existing state causes of action that included

A44

. recovery of punitive damages—functions as a limitation

' on a plaintiff’s recovery. In effect, Article 17 bars a

plaintiff from seeking the punitive damages to which he

or she would have been entitled had the United States

never ratified the Warsaw Convention. Therefore, plain-

tiffs continue, Article 17 is a limitation on a carrier’s

liability that must be lifted when the carrier is guilty of

willful misconduct.

In support of their first argument, plaintiffs point out

that both the provisions of Article 25 and the right to

recover punitive damages under American tort law are

triggered by a defendant’s willful misconduct. See 22

Am. Jur. 2d Damages § 764 (1988). Hence, it seems nat-

ural to believe, they add, that the purposes of Article 25

bear some relation to those of punitive damages and

that punitive damages are implicitly authorized by

Article 25. Quite the contrary, we think lifting the mon-

etary limit on compensatory damages is the Conven-

tion’s sole response to willful misconduct, and that it

stems not from the wish to punish the defendant but

from the idea that a party cannot rely on exclusions to

escape from his own wrongdoing. Drion, Limitation of

Liabilities at 262.

The idea of deterrence is inherent in both concepts,

but it would be a mistake to conclude that the presence

of a civil law concept necessarily authorizes the applica-

tion of a superficially similar, but actually different,

common law concept. In fact, the civil law appears to

judge that the award of full compensatory damages

alone is sufficient to deter willful misconduct, so puni-

tive damages would be both excessive and redundant.

Thus, ‘‘[f]or the carrier the consequences of an air acci-

dent are such that there would seem to be little need for

A45S

an additional incentive to prevent such accidents by

increasing his liability towards passengers and shippers.’’

Td. at 211.

Moreover, even when the liability limit is eliminated,

the rest of the Convention still governs the action. Jd. at

261; cf. D. Goedhuis, National Airlegislations and the

Warsaw Convention 155-56 (1937) (similar to willful

misconduct, irregularity in traffic documents results in

unavailability of provisions that limit or exclude the car-

rier’s liability, but this ‘‘in no way implies that all the

rules of the Warsaw Convention should no longer be

applied . . . all the rules remain in force except those

that limit or exclude’’ liability). Consequently, when the

Convention refers to terms that limit or exclude liability,

it refers solely to terms within the Convention itself, as

conceived by the contracting parties. See Drion, Limita-

tion of Liabilities at 261. As to plaintiffs’ second argu-

ment that Article 17 functions as a limitation on

liability, it is settled that Article 25’s reference to provi-

sions that ‘‘exclude or limit’’ liability includes at least

Articles 20(1) (due diligence and impossibility defenses)

and 22(1) (monetary limits) of the Convention. See

Molitch v. Irish Int’l Airlines, 436 F.2d 42, 44 & n.1 (2d

Cir. 1970); Grey v. American Airlines, 227 F.2d 282,

285 (2d Cir. 1955), cert. denied, 350 U.S. 989 (1956).

Which of the other provisions are included is in doubt.

One commentator includes both Article 21 (contributory

negligence), and Article 26(4) (statute of limitations for

baggage and cargo), Shawcross & Beaumont, Air Law,

VII(213) (4th ed. 1990). Article 25, however, does not

lift every limit on a carrier’s liability. For example, it

does not lift Article 29’s statute of limitations. See

Molitch, 436 F.2d at 44. No authority has been cited by

A46

plaintiffs for the proposition that Article 25 refers to

Article 17.

As noted above, Article 25 only refers to terms within

the Convention. The framers, looking at the Convention

from the background of the civil law, saw Article 17 as

a means of creating liability or at the very least shifting

the burden of proof to the carrier. Article 17 was not

envisioned as a limit or exclusion of liability because, to

a civil lawyer unfamiliar with the concept of punitive

damages, Article 17 does not appear to limit liability in

any way. For us to impose a common law view on the

document, twisting the apple to appear to be an orange,

would violate principles of Treaty interpretation.

A counterpart to Article 25 is found in many civil law

countries that have statutory limits on personal injury

recoveries from common carriers. For example, Mexico,

El Salvador, Guatemala and Argentina all have various

liability limits according to the gravity of the injury, but

all provide that when the accident is due to ‘‘dolo,’’ the

Spanish equivalent of ‘‘dol,’’ then the liability is unlim-

ited. Cagle, The Role of Choice of Law in Determining

Damages for International Aviation Accidents, 51 J. Air

L. & Com. 953, 966-70 (1986) (Cagle, The Role of

Choice of Law). Nevertheless, none of these countries

allow plaintiffs to recover punitive damages as well as

unlimited compensatory damages when the liability limit

is lifted.

While Article 25 has been the subject of negotiations

regarding its revision, and has been criticized as unclear,

see Lowenfeld & Mendelsohn, at 503, 505, these later

negotiations bear out the conclusion that the parties did

not believe the Convention allowed for punitive dam-

ages. In the 1960’s, when the United States gave notice

A47

of denunciation of the Convention because of its low

limits On victim compensation, and then negotiated the

Montreal Accord with various international air carriers,

much of the debate among the delegates at the negotiat-

ing sessions centered around the proper level of compen-

sation. See, e.g., Lowenfeld & Mendelsohn, at 565-66.

Amidst all this talk of what a plaintiff might recover,

none of the delegates, including those from the United

States, raised a question regarding the possible availabil-

ity of punitive damages. See generally id. (detailing the

negotiating history of the Montreal Accord).

Similarly, the Guatemala Protocol to the Warsaw

Convention—which the United States has not ratified—

basically eliminated Article 25, raising the liability limit

to 1,500,000 francs per passenger but making that limit

apply even in the event of the carrier’s willful miscon-

duct. Cagle, The Role of Choice of Law, 51 J. Air L. &

Com. at 989. Because the Guatemala Protocol would

not even allow unlimited compensatory damages, it fol-

lows a fortiori that the contracting parties to the Con-

vention did not contemplate punitive damages

Moreover, all of the negotiation preceding the action

concerned the circumstances in which Article 25 comes

into play and about how to translate the concept of do/

into English, not about the extent of the carrier’s liabil-

ity once the Article was invoked. See Miller, Liability in

International Air Transport at 78. The absence of the

dispute, particularly in the context of the civil law,

evinces an assumption that Article 25’s ‘‘unlimited lia-

bility’? meant only unlimited compensatory liability.

a A48

VI POLICY CONSIDERATIONS

Finally, consideration of the purposes behind the

Convention compel the conclusion that the shared

expectations of the Convention’s drafters did not con-

template that punitive damages be available under the

Convention. Although the Convention’s language must

be construed in a way to avoid impairing pre-existing

rights such as the right to punitive damages, if reasona-

bly possible, see, e.g., Guaranty Trust Co. v. United

States, 304 U.S. 126, 143 (1938); Herd & Co. v. Krawill

Machinery Corp., 359 U.S. 297, 304-05 (1959), an exam-

ination of this question in light of the Convention’s pur-

poses is persuasive proof that the drafters—and the

United States when it adhered to the Convention—could

not have intended to permit a right to obtain punitive

damages. Interpreting the Convention to allow such

recovery would severely hobble most of the aims the

Convention sought to accomplish: establishing a uni-

form carrier liability regime, limiting carrier liability to

ensure a viable industry, ensuring the carriers’ ability to

insure against losses, and adequately compensating

injured passengers quickly and with a minimum of liti-

gation. We discuss briefly some of those policies.

A. Uniformity

Allowing punitive damages would undoubtedly

destroy uniformity. No other signatory allows them. The

Convention should be read to further its purposes to the

greatest extent possible, and one of its primary purposes

was to achieve uniformity in the liability and amount of

damages awardable. No authority that we have

unearthed demonstrates that any other country has

A49

awarded punitive damages under the Convention. The

goal of uniformity ‘‘would be greatly defeated if it were

left to the national legislator’ to set aside all other pro-

visions of the Convention and replace the Convention

with national law in the case of willful misconduct.

Drion, Limitation of Liabilities at 261. Were the United

States alone to allow such recoveries, it would act as a

magnet so that every airline injury claim would, if possi-

ble, be brought in the United States. The enormous dif-

ference between the dama vs recoverable here and those

recoverable in other forums would thereby destroy much

of the value of the Convention.

B. Carriers’ Ability to Insure Against Losses

Allowing punitive damages recoveries might well also

defeat the goal of making airlines insurable. First, air-

lines might not be able to obtain such insurance because

a number of states have traditionally barred insurance

coverage of punitive damages on the theory that such

coverage is contrary to public policy because it lessens

the defendant’s incentive to take reasonable care or at

least not to commit willful misconduct. See Mooney,

The Liability Crisis—A Perspective, 32 Vill. L. Rev.

1235, 1237-38 & n.9 (1987)(Mooney, The Liability Cri-

sis); Comment, Punitive Damages: The Burden of Proof

Required by Procedural Due Process, 22 U.S.F L. Rev.

99, 102 & n.8 (1987). If an airline could not find an

insurer able or willing to sell insurance for punitive

damages, it might well choose to go out of business, or

at least out of the international market, rather than risk

bankruptcy with every flight.

Second, even if the airline industry could obtain such

insurance, the cost of a ticket would skyrocket in

AS50

response to the higher cost of such insurance. Cf.

Mooney, The Liability Crisis at 1259 (in Canada, which

has caps on non-economic awards, the average premium

is one third that of the average premium in the United

States). The extra costs of higher insurance, plus the

uninsurable risks, would increase the costs of airlines

overall and could—as currently escalating fuel costs

have demonstrated—contribute to the downfall of an

airline teetering on the edge of insolvency. It is also

likely that punitive damages recoveries would inhibit

innovation in the industry. Cf. Browning-Ferris, 109 S.

Ct. at 2924 (O’Connor, J. concurring in part and dis-

senting in part) (‘‘designers of airplanes and motor vehi-

cles have been forced to abandon new projects for fear

of lawsuit that can often lead to awards of punitive

| damages’’), citing P. Hub

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