Petition for Writ of Certiorari — McDonald v. Piedmont Aviation, Inc.
Supreme Court brief1991
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No. oe
, Ae
In The
Supreme Court of the United States
October Term, 1991
¢
PAUL F. MCDONALD,
Petitioner,
PIEDMONT AVIATION INC.,
Respondent.
+
Petition For A Writ Of Certiorari
To The United States Court Of Appeals
For The Second Circuit
°
PETITION FOR A WRIT OF CERTIORARI
+
JouHN G. McDona.tp
64 Montgomery Street
Rhinebeck, N.Y. 12572
(914) 876-2696
Counsel for Petitioner
ALBERT J. GayNor
One North Broadway
White Plains, N.Y. 10601
(914) 761-2399
Counsel of Record
COCKLE LAW BRIEF PRINTING CO., (800) 225-6964
OR CALL COLLECT (402) 342-2831
\2S
QUESTION PRESENTED
Where a jury found liability for a breach of the duty
to hire in Section 43(d) of The Airline Deregulation Act of
1978, and the trial Court refused to award a job, but used
a “make whole” measure of monetary damages in the
job’s stead, whether it was error to reduce those damages
to a seventy-two month period by importing from Section
43(e) a limit on the wholly separate government assis-
tance program, intended to protect federal revenues,
where this truncating of damages leaves the wronged
party without either the job that the statute and verdict
still entitle him to, or compensation therefor, and wholly
frustrates the several purposes of Section 43(d).
ii
TABLE OF CONTENTS
Page
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OPINIONS FROM OTHER COURTS AND AGEN-
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STATUTORY PROVISIONS INVOLVED............. 2
STATEMENT OF ‘THER CAG 6 oo ccece cea ces scanscs 2
SEPT E GP WN BOs 66. cnvcnnandenetssesaeenees 3
REASONS FOR GRANTING THE WRIT ........... 5
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4#.PPENDIX 1. . . Opinion of the United States
Court of Appeals for the Second Circuit in Paul
F. McDonald v. Piedmont Aviation, Inc. 930 F 2d
220 (No. 90-7328, 2d Cir., April 11, 1991) ....App. 1
APPENDIX 2... Order of the United States Court
of Appeals for the Second Circuit in McDonald
v. Piedmont, Ibid, June 24, 1991 .............. App. 17
APPENDIX 3... Order of the United States Court
of Appeals for the Second Circuit in McDonald
v. Piedmont, Ibid, April 25, 1991 ............. App. 19
APPENDIX 4 . . . Opinion of the United States
District Court, S.D. New York in McDonald v. Pied-
mont, 625 F Supp 762, No. 84 Civ. 8262 CLB, Jan. 6,
re een ner NMA iypoa tor App. 21
iil
TABLE OF CONTENTS - Continued
Page
APPENDIX 5. . . Opinion of the United States
District Court, S.D. New York in McDonald v.
Piedmont, 695 F Supp 133, Sept. 7, 1988...... App. 32
APPENDIX 6... Memorandum and Order of the
United States District Court, ©.D. New York, in
McDonald v. Piedmont, 84 Civ. No. 8262 (CLB),
ee te eee eee eee App. 44
APPENDIX 7... JURY INSTRUCTIONS, of the
United States District Court, S.D. New York in
McDonald v. Piedmont, Ibid................... App. 49
APPENDIX 8 . . . Opinion of the United States
Court of Appeals for the District of Columbia
Circuit in Crocker v. Piedmont, No. 90-7021, May
EEE Oe ee rr re reer ee eee App. 53
APPENDIX 9... The Airline Deregulation Act of
1978, §§ 102(a)(1) & (2), and § 43 (49 USC
§§ 1302(a)(1) & (2), § 1552)...........0.0000. App. 66
APPENDIX 10... Affidavit of Air Safety Expert
John J. Nance, dated May 13, 1991, submitted to
the Second Circuit Court of Appeals in
McDonald v. Piedmont, 90 Civ. No. 7328...... App. 74
iv
TABLE OF AUTHORITIES
Page
CASES
Alaska Airlines, Inc. v. Brock, 480 US 678 (1987)
i ucee ail waded DOA kee eh eeeeen cakes 3, 5, 6, 13, 20, 22
Alaska Airlines, Inc. v. Donovan, 594 F Supp 92
Pe WN 6 ba irik eanns kbc an nakeennetbeeaseea van 5
Albemarle Paper Co. v. Moody, 422 US 405 (1975)..... 13
American Tobacco Co. v. Patterson, 456 US 63, 68
Sek 35S a ek sad ond daae dh en nananeue Raxckhaneeas 11
Bigelow v. RKO Radio Pictures, 327 US 251, 265
2 RRS errr rey error Tr TT rrr ere rit ey Pere 16
Chevron USA, Inc. v. Natural Resources Defense
Counsel, Inc., 467 US 837 (1984).................05. 9
Crandon v. United States, US __, 110 S Ct 997,
TOR L, TE Be Fie CARI a nce csc cccnccsencnns 11, 12
Crocker v. Piedmont Aviation, Inc., 741 F Supp 241, No.
86-1673 (D.D.C. Aug. 11, 1989), appeal docketed, No.
90-7021 (D.C. Cir. Feb. 23, 1990).......... 1, 6, 7, 8, 18
Crocker v. Piedmont, (C.A.D.C. Cir., No. 90-7021,
ee) RS ne heer rer rey ery ys ae ae )
Gozlon-Peretz v. U.S., 112 L Ed 2d 919, 930 (1991) .... 10
Guidry v. Sheet Metal Workers National Pension
Fund, ____ US __, 110 S Ct 680, 107 L Ed 2d 782
Pana gepere Penne Dr ene Peep See Tay gern ree 11
Hughey v. United States, 495 US __, 109 L Ed 2d
oe fe | es rr eee 12
McDonald v. Piedmont Aviation, Inc., 625 F Supp
A | ey rey PER EA, NC a ae 26
Vv
TABLE OF AUTHORITIES - Continued
Page
McDonald v. Piedmont Aviation, Inc., 930 F 2d 220
(No. 90-7328, 2d Cir., April 11, 1991) ............. 10
McNeil v. Economics Laboratory, Inc., 800 F 2d 111,
ge g Be | eer rr ere TTS rer er rrer 15
Pennsylvania Department of Public Welfare v. Daven-
port, _ _ US___, 110 S Ct 2126, 109 L Ed 2d 588
ee ree rene ry reno claret irene 12
Pension Benefit Guaranty Corporation v. LTV Corpo-
ration, __ US __, 110 S Ct 2668, 110 L Ed 2d
rer ie ee Pe oS ewe 12
Robinson v. American Airlines, Inc., 908 F 2d 1020,
SE Gees, SG ID 8 on nd bo Wa oc hx pa edekawasevenes 9
Shore v. Federal Express, 777 F 2d 1155 (6th Cir,
WO 5 bs Wa ee pane eek a aban ese sea ene te eeeres 16
Tafflin v. Levitt, __ US __, 110 S Ct 792, 107 L Ed
ee er A oo he hahah cawa veda cesneneaen es 9, 12
Udall v. Tallman, 380 US 1, 16 (1965)................. Yy
Whittlesey v. Union Carbide Corp., 742 F 2d 724, 728
CRW ca has oo kad eae ne ae ee eee eee 15
STATUTES
Be a es ve as cece epee eae eee 2
Oy UR ors iv ae env ana cae ebanae eta eee 2
i Brrr eer ree rere e 2
ae Se Ge Oe Oe WN 8 oes nec eaenees 15
oF ie. a cc ecw eae eaes esau | passim
EER Sass 9 de pg eeu ene eae pas gen
vi
TABLE OF AUTHORITIES - Continued
Page
ADMINISTRATIVE PROCEEDINGS
Cee Se Ce CE or an's Cewescectadbeavatauesss 18
LEGISLATIVE MATERIALS
Cong. Rec. Senate, April 19, 1978, S. 5877. R. 71; A
SE tir area pay ih FCPS CT ean A Pear ap rE 19
a Rep. No. SH-O5t, p. TE CEIPOD. oc occ cc ccscnencascs 14
MISCELLANEOUS
73 Am Jur 2d (1974) STATUTES Section 278......... 15
PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
Petitioner, PAUL F. MCDONALD, respectfully prays
that a writ of certiorari issue to review the judgment and
opinion of the United States Court of Appeals for the
Second Circuit.
OPINIONS BELOW
The opinion from the Court of Appeals for the Sec-
ond Circuit is attached hereto as Appendix 1. Two pub-
lished opinions and a memorandum and order by the
United States District Court for the Southern District of
New York, are appended hereto as Appendices 4, 5, and
6.
OPINIONS FROM OTHER COURTS AND AGENCIES
The conflicting opinion of the Circuit Court of
Appeals for the District of Columbia in Crocker v. Pied-
mont Aviation, Inc. is attached hereto as Appendix 8. The
conflicting DOL Amicus Brief filed therein, Lodged,
appended to McDonald’s Brief on Appeal.
¢
JURISDICTION
The opinion of the Second Circuit Court of Appéels
was filed on April 11, 1991. An order granting permission
to extend time to file a petition to rehear, and to submit a
DOL Amicus Brief and the Affidavit of Air Safety Expert
John J. Nance was signed on May 7, 1991. An order
denying said petition was filed on June 24, 1991. Appen-
dices 2 & 3.
The jurisdiction of this Court is invoked pursuant to
28 USC Section 1254(1). The petition is timely.
+
STATUTORY PROVISIONS INVOLVED
Sections 102(a)(1) & (2) and Section 43 of the Airline
Deregulation Act of 1978 (49 USC §§ 1302(1) and (2), and
§ 1552) attached hereto at Appendix 9.
¢
STATEMENT OF THE CASE
McDonald sued Piedmont Aviation, Inc. in the
United States District Court for the Southern District of
New York for a violation of his First Right of Hire under
Section 43(d) of the Airline Deregulation Act of 1978 (49
USC Section 1552(d)) seeking employment, with back pay
and seniority. The court’s jurisdiction was invoked pur-
suant to 28 USC Sections 1331 and 12332.
After trial, the jury found Piedmont had wrongfully
failed to hire McDonald as of January 1982. At this point,
McDonald was entitled to employment in his occupa-
tional specialty, i.e. pilot, with back pay and seniority as
of that date. The trial Court, however, refused to grant
the job, and awarded a “make whole” measure of mone-
tary damages in its stead. Based on an exhaustive and
uncontroverted economic expert’s report on the earnings
differential McDonald would suffer, the jury awarded
compensatory damages of $2,226,920.
On appeal, the Second Circuit Court of Appeals
upheld the jury’s finding of liability, and all of the trial
Court’s rulings, except as to measure of damages. The
Appellate Court reduced the damages to seventy-two
months of back pay, with no award of employment, by
improperly engrafting the limit on Section 43(a) & (b)’s
wholly separate government assistance program, onto
damages for a wrongful failure to hire under Section
43(d).
STATEMENT OF FACTS
Since the passage of Section 43 in 1978, the air car-
riers individually, and collectively through the Air Trans-
port Association (ATA), have conspired to obstruct and
defeat First Right of Hire in every possible way. From
1978 until November 1981 when Air New England failed,
none of the hundreds of furloughed TWA, Pan Am and
other protected pilots dared challenge a carrier by assert-
ing Section 43 rights. Captain McDonald, a thirty-seven
year old protected pilot from Air New England, was the
first to assert that right at an airline, Piedmont, the only
obligated carrier hiring significantly in 1981-82. All cov-
ered carriers had pilot hiring-age cut-offs in effect at that
time: Piedmont’s was thirty-two years of age.
McDonald pursued Piedmont until it arrogantly
rejected him on May 28, 1982. McDonald, meanwhile,
lobbied the DOL through the Spring of 1982 (See DOL
file, Lodged), until his efforts, his rejection by Piedment,
and the impact of a horde of protected Braniff pilots
becoming available in May of 1982, aroused the DOL to
impel Piedmont to comply with the Act.
Piedmont so complied from July 1982 until May 1984
(but it excluded McDonald), yet the rest of the ATA
continued to stonewall, and succeeded in getting Section
43 struck down in Alaska, et al v. Donovan, 594 F Supp 92
(D.D.C. 1984), in May 1984, at which time Piedmont
immediately ceased hiring protected pilots. The Supreme
Court has since unanimously upheld the Act. Alaska Air-
lines, et al v. Brock, 480 US 678 (1987). Yet, even after the
High Court’s characterizing of the statutory language as
“sufficiently unambiguous to notify carriers of their
responsibilities”, and calling the duty to hire “an affirma-
tive duty the statute places directly on air carriers”, 480
US at 687, the carriers arrogantly continue to stonewall
the statute.
The reason for the carriers’ objection to Section 43 is
simple: older protected pilots’ pensions are far more
costly to fund than those of green new entrants. See
Akins Report (Lodged herein). There he explains that
Piedmont’s present value cost to fund pensions of the
younger unprotected pilots it hired prior to July 1982 was
two hundred forty thousand dollars less per man than for
the older protected pilots hired after July 1982. In fact, the
incremental cost to Piedmont of its temporary change in
policy, forced by McDonald and the Department of Labor,
of hiring older protected pilots over the next two years,
was Over seventy-two million dollars (Akins Report,
Lodged).
McDonald is the first, and only, of the thousands of
protected employees whose Section 43 rights were fla-
grantly dishonored by an intransigent industry, who has
managed to get as far as a jury trial.
¢
REASONS FOR GRANTING THE WRIT
POINT I
The Court’s understanding of the statute is in contra-
diction to that of an unanimous Supreme Court as
expressed in Alaska Airlines, Inc. v. Brock, 480 US 678
(1987), at pages 687 through 697, and especially at page
694, and footnote 18 thereon.
POINT II
The Court’s understanding of the statute is in conflict
with that of the Court of Appeals for the District of
Columbia, which overturned the case upon which this
Court heavily relied in setting the measure of damages,
and that of the Department of Labor as set forth in an
Amicus Brief filed therein.
POINT III
The Court misapprehends the plain meaning of the
Statute in importing Section 43(e)’s limitations on assis-
tance payments of seventy-two months to the wholly
separate First Right of Hire created in Section 43(d)(1).
POINT IV
The truncated measure of damages frustrates the
intent of Congress in establishing the rehire program
both to protect airline careers and to reinvest the irre-
placeable experience of protected pilots to maintain the
highest standards of safety in the industry that had been
built up over decades of regulation.
POINT V
The truncated measure of damages defangs the only
available mechanism to enforce First Right of Hire, and
leads to the absurd result of rewarding carriers for wan-
tonly flouting the will of Congress.
S
ARGUMENT
THE COURT ERRED IN FOLLOWING REASONING
IN CROCKER THAT HAS ALREADY BEEN REJECTED
BY THE SUPREME COURT.
The McDonald Court’s error in setting a measure of
damages lies in adopting the reasoning in Crocker v. Pied-
mont, No. 86-1673 (RCL)(D.D.C. Feb. 8, 1990). It is odd
that the Court would seek guidance from a District Court
which clearly misunderstood the statute rather than from
the Chief Judge of the S.D.N.Y., whose understanding of
the statute has been ratified by a unanimous Supreme
Court. Alaska et al v. Brock, 480 US at 687, footnote 9.
The Crocker Court made a fundamental error in
importing into the First Hire program of Section 43(d)(1)
a limitation on the other prong of the statute, the assis-
tance program created in Section 43(a). It assumed that a
limitation on assistance payments in Section 43(b), obvi-
ously intended to protect federal revenues, should also
limit First Right of Hire; that because assistance payments
were to be reduced by the amount of earnings at
“comparable employment”, i.e. with a non-obligated car-
rier, that is, one not certificated as of October 23, 1978,
such employment should also extinguish First Right of
Hire. To do so, the Court, in effect, rewrote the statute.
Section 43(d)(1) clearly intends that the goal of First Right
of Hire is a job with an obligated carrier, and is not
extinguished except by a job with such a carrier. See DOL
Amicus Brief (Lodged) and Nance Affidavit, Appendix
10.
The McDonald Court, following Crocker, makes pre-
cisely the same error when it held that “the jury could not
have determined that the employment (at Air Berlin) was
reasonably comparable (to Piedmont)”. Opinion, page 15.
This statement necessarily implies that the Court, had it
found the Air Berlin job comparable, would have held
that said job extinguished McDonald’s First Hire Rights
at Piedmont.
The Court goes on to compound its error by assum-
ing that the Congress would have intended that damages
for a breach of Section 43(D)(1)’s duty to hire should be
limited by the seventy-two month limit on assistance
payments in Section 43(e).
The Court’s error is based on its following Crocker
(D.D.C.) in assuming that “the duty to hire provision was
adopted as a supplement for” the assistance program
8
(quoting Crocker, at page 14), and in characterizing the
First Hire program’s “purpose as a supplement to the
temporary monthly assistance payments” (p. 14). It fur-
ther erred, again following Crocker, in assuming that the
two prongs of Section 43, the assist.nce program and
First Right of Hire, were so interwoven and tightly linked
that the Congress intended the various limits on assis-
tance payments should also limit First Right of Hire.
But the Supreme Court had already unanimously
rejected the notion that the two prongs of Section 43 are
“tightly linked”, stating that the First Hire program
“could stand alone as the sole means of employee protec-
tion”, and that the assistance program, not First Hire, “was
regarded (by Congress) as the second line of attack”
(emphasis added), 480 US at 694, footnote 18.
By concluding that the two programs were separate,
and that Congress intended to give primacy to First Hire
as the favored means of employee protection, the
Supreme Court has already refuted the reasoning of
Crocker, on which the Court so heavily relied.
THE COURT’S DECISION IS IN CONFLICT WITH
THE COURT OF APPEALS FOR THE DISTRICT OF
COLUMBIA AND THE DEPARTMENT OF LABOR.
The Appellate Panel in Crocker v. Piedmont (C.A.D.C.
Cir., No. 90-7021, May 24, 1991) requested the DOL to file
an Amicus Brief on the issue raised below, whether a job
with a non-covered carrier extinguished First Hire Rights.
The DOL wholly disagreed with the District Court. See
DOL Brief, lodged herein appended to McDonald’s Peti-
tion to Rehear.
The Crocker Panel then held that “because Congress
expressly charged the Department with administering the
EPP, its interpretation is entitled to deference unless
inconsistent with the statutory language”, citing Robinson
v. American Airlines, Inc., 908 F 2d 1020, 1023 (D.C. Cir.
1990). Crocker, supra, 933 F 2d at 1027. See also Udall v.
Tallman, 380 US 1 (1965) and Chevron USA, Inc. v. Natural
Resources Defense Counsel, Inc., 467 US 837 (1984).
The Crocker Panel then reversed the lower Court,
stating:
“We reject the district court’s analysis for the
following reasons.
First, the EPP itself imposes no limits on the
length of a protected employee’s first-hire right
and we do not believe the statutory restrictions
on financial assistance should be engrafted on
the first-hire provisions.
3In fact, given the express statutory restrictions on
the financial assistance benefits, the absence of any
similar limitations on the first-hire right suggests
that Congress intended to impose none.”
This well-established rule of interpretation was hard-
ened beyond “suggestion” in recent Supreme Court cases:
“ “Where Congress includes particular language
in one section of a statute but omits it in another
section of the same Act, it is generally presumed
that Congress acts intentionally and purposely
in the disparate inclusion or exclusion.’ Russello
v. United States, 464 US 16, 23, 78 L Ed 2d 17, 104
S Ct 296 (1983) (internal quotations omitted); see
General Motors Corp. v. United States, 496 US __,
10
110 L Ed 2d 489, 110 S Ct 2528 (1990).” Gozlon-
Peretz v. U.S., 112 L Ed 2d 919, 930 (1991).
The Crocker Appeals Panel explicitly points out its
conflict with the McDonald Appeals Panel:
“In declining to apply those restrictions to the
first-hire provisions, we may be at variance with
the Second Circuit’s recent decision in McDonald
v. Piedmont Aviation, Inc., No. 90-7328 (2d Cir.
April 11, 1991), which relied on the financial
assistance restrictions to limit to seventy-two
months the amount of back pay recoverable by a
protected employee who is denied his first-hire
right. Id. at 12-15,” (Opinion page 7, footnote 4).
THE COURT BELOW IMPERMISSIBLY
REWROTE THE STATUTE.
The Court of Appeals’ interpretation of Section 43
ignores the Supreme Court’s repeated admonishments
that statutes enacted by Congress and signed by the
President must be enforced by their express terms, and
that when a statute contains specific language in one
Section, and not in another, the Congress so wrote it
intentionally.
“As in all cases involving statutory construction, ‘our
starting point must be the language employed by Con-
gress’... and we assume ‘that the legislative purpose is
expressed by the ordinary meaning of the words used.’
Thus ‘(a)bsent a clearly expressed legislative intention to
the contrary, that language must ordinarily be regarded
as conclusive’ ”. This literal construction “is particularly
cogent” where, as is obviously the case with the ADA and
Section 43, the Congress has painstakingly considered the
11
law in its debate and drafting. American Tobacco Company
v. Patterson, 465 US 63, 68 (1982).
The Court of Appeals’ error was in following the lead
of Crocker v. Piedmont Aviation, Inc., No. 86-1673 RCL
(D.D.C. August 11, 1989), where the District Court impor-
ted a limitation from Section 43(b) on the government
assistance payments into Section 43(d)’s First Hire pro-
gram to cut off a protected pilot’s right to be hired at
Piedmont because he had taken temporary employment
with a non-covered carrier.
The Second Circuit Panel in McDonald made precisely
the same error, and then compounded it by assuming that
because Congress sought to limit in Section 43(e) to sev-
enty-two months the government assistance payments
created in Section 43(a) and (b), it would or should also
have so limited damages for a wrongful failure to hire
under Section 43(d)(1).
The Congress, however, did no such thing! This was
purely an invention of the Court, which literally rewrote
the statute. The seventy-two month limit in Section 43(e)
applies to exactly what it says it does in its black letter
heading, that is to the “Period of monthly assistance
payments.” The Congress did not add thereto the words
“and of damages against a carrier for a breach of duty to
hire”.
Nor is there any indication anywhere in the language
of Section 43(d) or Section 43(e), nor anything in the
legislative history, to suggest Congress ever contemplated
such a limitation on damages under Section 43. Where the
legislative history “reveals no evidence that Congress
even considered” the issue, and “even if (the Court)
12
could reliably discern what Congress’ intent might have
been had it considered the question,” the courts may not
“speculate”, as the McDonald Court did, on what Con-
gress’ choice may have been. Tafflin v. Levitt, supra, 110 S
Ct at 796.
In going beyond the literal meaning of Section 43(e)
to “engraft it” onto Section 43’s First Right of Hire, the
Court of Appeals overlooked the recent Supreme Court
decisions involving suggestions to imply language which
was not expressly set forth in the relevant statutes. Guidry
v. Sheet Metal Workers National Pension Fund, __ US __,
110 S Ct 680, 107 L Ed 2d 782 (1990); Crandon v. United
States, __ US __, 110 S Ct 997, 108 L Ed 2d 132 (1990);
Pennsylvania Department of Public Welfare v. Davenport, ___
US __, 100 S Ct 2126, 109 L Ed 2d 588 (1990); Pension
Benefit Guaranty Corporation v. LTV Corporation, __ US __,
110 S Ct 2668, 110 L Ed 2d 579 (1990); Tafflin v. Levitt, __
US __, 110 S Ct 792, 107 L Ed 2d 887 (1990).
These cases make clear that absent “rare and excep-
tional circumstances” (Crandon, supra 110 S Ct at 1006),
Federal statutes are to be read and applied literally if the
literal meaning is consistent with one of the purposes of
the Act. Even when a literal reading leads to an “anoma-
lous” result (P.D.P.W. v. Davenport, supra 110 S Ct at 2132)
or one that “may seem strange” (Crandon, supra 110 S Ct
1010) the literal reading of the statute must be applied.
And, the High Court recently rebuked a party for
ignoring “this Court’s commitment to ‘giving effect to the
meaning and placement of the words chosen by Con-
gress’. Adams Fruit Co. v. Barrett, 494 US __,__, 108 L Ed
13
2d 585, 110 S Ct 1384 (1990)”, Hughey v. United States, 109
L Ed 2d 408, at 416 (1990).
F ally, in those “rare and exceptional circumstances”
where a Court has been allcwed to read words into a
statute, it has been done only to further the intent of the
statute. The Court’s error here does so to nullify the
intent of Congress.
THE EXPRESS TERMS OF THE STATUTE AND ITS
LEGISLATIVE HISTORY MANDATE A MAKE WHOLE
REMEDY.
The absence of an explicit enforcement mechanism
for First Right of Hire, and remedy for a breach thereof,
indicate that the Congress naively expected carriers to
obey their mandated duty to hire protected employees.
The Congress never contemplated a remedy because it
expected no need for one. The carriers’ wholesale defying
of their obligations, however, requires the Court to fash-
ion a remedy consistent with the intent of Congress to
protect careers and reinvest experience to maximize
safety.
“Where a legal injury is of an economic character,
‘(t)he general rule is, that when a wrong has been done,
and the law gives a remedy, the compensation shall be
equal to the injury. The latter is the standard by which the
former is to be measured. The injured party is to be
placed, as near as may be, in the situation he would have
occupied if the wrong had not been committed.’ Wicke v.
Hoppock, 6 Wall 94, 99, 18 L Ed 752 (1867).” Albemarle
Paper Co. v. Moody, 422 US 405, 418-19 (1975).
14
The Albemarle Court was interpreting Title VII of the
Employment Discrimination Act and points out that in
that statute the Congress had “take(n) care to arm the
Courts with full equitable powers” (122 US at 418). In
fashioning a remedy on damages for Section 43, the Court
is obviously invoking its equitable powers. There is every
reason to believe that to protect Section 43 rights, where
the Congressional purpose was to undo harm suffered by
a class of individuals caused by its own hand, the legisla-
ture also would have “armed the Courts with full equita-
ble powers”.
“Where Federally protected rights have been
invaded, it has been the rule from the beginning
that Courts will be alert to adjust their remedies
so as to grant the necessary relief ... For it is the
historic purpose of equity to ‘secure complete
justice’.” Albemarle, and cases cited therein, 422
US at 418.
The Albemarle Court goes on to state that “the ‘make
whole’ purpose of Title VII is made evident by the legisla-
tive history”, 422 US at 419. Likewise, the legislative
history cited by a unanimous Supreme Court in Alaska, at
480 US 678 (1987), and the Court’s thorough exegesis of
the express language of the statute, argue powerfully that
a “make whole” remedy is required for violations of First
Hire Rights under Section 43.
Anything short of a make whole remedy would
indeed cause the “benefits to the public” to be paid for
“by a minority — airline employees and their families who
have relied on the present system”, S. Rep. No. 95-631, p.
114 (1978). The Report specifically points out that “older
employees . . . might encounter difficulties because of
15
their age,” and the statute mandates the right applies
“regardless of age”, Section 43(d)(1). Because Captain
McDonald was denied his right precisely because of his
age, and because he and his family have suffered, and
will continue to suffer, substantial pay differentials, the
clear Congressional intent to protect his career, short of
re-employment, can only be effected by making him
whole.
BECAUSE THE COURT PRECLUDED AN AWARD OF
EMPLOYMENT, FRONT PAY IS NECESSARY TO
MAKE MCDONALD WHOLE.
In his complaint, McDonald asked for and would far
have preferred, an award of back pay and employment
with seniority as of the date of the wrongful failure to
hire. The trial Court, however, took the position that it
would be improper to compel an air carrier to hire a
person for so sensitive a position as pilot. In the absence
of a hiring remedy, front pay becomes essential. Without
it, McDonald and his dependents would be left to suffer a
continuing deprivation of some one hundred thousand
dollars per year and a total loss of retirement benefits.
See the Akins Report (Lodged).
And, Section 43(d) is obviously a remedial statute
and thus is “entitled to a liberal construction in favor of
the remedy provided by law, or in favor of those entitled
to the benefits of the statute,” 73 Am Jur 2d (1974) STAT-
UTES, § 278.
“Denial of reinstatement in those situations,
without an award of reasonable, offsetting com-
pensation, would leave the plaintiff irreparably
16
harmed in the future by the employer’s discrim-
inatory discharge, and would permit the defen-
dant’s liability for its unlawful action to end at
the time of judgment. To prevent this injustice a
reasonable monetary award of front pay is nec-
essary as ‘equitable relief . . . appropriate to
effectuate the purposes of (the ADEA).’ 29 USC
Section 626(b).” Whittlesey v. Union Carbide
Corp., 742 F 2d 724, 728 (1984).
Because McDonald and the other LPP’s were denied
First Hire precisely because of their age, it is logical to
look to the Age Discrimination in Employment Act (29
USCS §§ 621 et seq); in fashioning a remedy for breach of
duty to hire. All the circuits that have decided the issue
have held that front pay is an available remedy in appro-
priate cases under the ADEA. McNeil v. Economics Labora-
tory, Inc., 800 F 2d 111, 118 (7th Cir., 1986) citing cases
from the Ist, 2nd, 3rd, 6th, 8th, 9th, 10th and 11th Cir-
cuits. These cases indicate the Circuits are in agreement
on the following: that front pay is especially appropriate
where reinstatement is inappropriate, that front pay is a
matter within the discretion of the trial judge, that the
intent of front pay is to make the victim whole where a
job is not possible, that the award of front pay is review-
able only for abuse of discretion, and that there must be
some rational basis in the evidence for the award. See
also Shore v. Federal Express, 777 F 2d 1155 (6th Cir. 1985).
UNCERTAINTY DOES NOT BAR AN AWARD OF
FRONT PAY.
Courts are commonly called upon to determine
future damages in many different kinds of cases. All such
17
determinations necessarily involve a degree of uncer-
tainty. To allow that uncertainty to prevent recovery
whenever damages cannot be precisely determined,
would be to deny a remedy to a large percentage of those
injured and to unjustly reward wrongdoers.
“The mere fact that damages may be difficult of
computation should not exonerate a wrong-doer
from liability. The most elementary notions of
justice and public policy require that a wrong-
doer shall bear the risk of the uncertainty which
his wrong has created,” Bigelow v. RKO Radio
Pictures, 327 US 251, 265 (1946).
Because of the nature of the pilot contracts in the
industry, projecting McDonald’s future damages involves
far less uncertainty than is usually the case. McDonaid’s
economic expert, Daniel W. Akins, who had evaluated
union contracts at ALPA, crafted a clear and careful
report, documenting the earnings differential McDonald
had suffered, and could expect to suffer, and thoroughly
explained it to the jury. See the Akins report and the
discussion of it in McDonald’s Brief on Appeal, both
Lodged herein. The jury was sufficiently impressed with
its cogency to return to the penny Akins’ estimate of his
damages. See Akins Report Addendum Table 3 (Lodged).
IT IS ILLOGICAL, UNJUST, AND AGAINST THE
INTENT OF CONGRESS TO CUT OFF MCDONALD’S
DAMAGES AS OF JANUARY 1988 WHEN HIS FIRST
RIGHT OF HIRE, PIEDMONT’S OBLIGATION TO
HONOR IT, AND HIS DAMAGES, ALL ARE ONGO-
ING.
As the DOL persuasively argues in its Amicus Brief,
the goal of Section 43 is for protected pilots to obtain jobs
18
with covered carriers, that is, those certificated as of 23
October 1978. That right is not extinguished, and the
primary purpose of Section 43 is not met, until such
employment is obtained.
The DOL assumes, quite logically, that First Right of
Hire, once obtained during the ten year period survives
the ten year period. See the DOL letter to George Paul of
United Airlines, stamped 3 January 1991, appended to the
DOL Brief (Lodged) in Addendum C. Although there is
an expiration date of 24 October 1988 on the opportunity
to obtain First Right of Hire, there is no expiration date in
Section 43(d) on the duty to honor it.
McDonald acquired First Right of Hire on 31 October
1981 when Air New England terminated. Since he has
been unable to obtain work with any covered carrier
since, his right survives to this day. The job at Air Berlin
could not extinguish his right, nor relieve Piedmont of its
obligations.
Note that McDonald reapplied to Piedmont in 1987
and was rejected as unqualified. See McDonald and Pied-
mont letters at Addendum A of McDonald’s Brief on
Appeal (Lodged).
When a pilot who is protected under Section 43(h)
acquires First Right of Hire under Section 43(d)(1), he
does not yet become eligible for government assistance.
His job loss must be found to be the result of a “qualify-
ing dislocation”, §§ 43(a) & (h)(2). McDonald was never
eligible because the CAB did not find Air New England’s
demise the result of a “qualifying dislocation” (CAB
ee
19
Docket #40201, 1981). In fact, no one has ever been eligi-
ble, because no “qualifying dislocation” has ever been
found by any agency!
Yet that never stripped anyone of his protected status
as defined in Section 43(d)(1) and (h)(1). First Right of
Hire is the only aspect of the entire protective provisions
to functionally exist. How can the seventy-two month
limitation, applied to assistance payments which never
existed, for employees who never qualified, be used as a
means to reduce a jury award predicated on the make
whole remedy in lieu of hiring?
If McDonald had sued the government for assistance
benefits, the seventy-two month limit would properly
apply. But McDonald sued a carrier for the job that the
Statute, the jury’s verdict, and the upholding of that
verdict as to liability, entitle him. The limit in “Period of
monthly assistance payments” has no revelance to this
remedy.
The initial error of Crocker (D.C.C.) was made
because the Court felt it a “strange result” that the Con-
gress would put a greater burden on the carriers than on
the government. The legislative history makes clear, how-
ever, that this is precisely what was intended. In intro-
ducing the First Hire provision, intended as a
replacement for the monthly assistance provisions,
because of concerns about burdening the public purse,
Senator Zorinsky. stated:
‘
‘... instead of affording the relief of compensa-
tion from the pockets of the Nation’s taxpayers,
my amendment provides that qualified pro-
tected employees be given a preference in hiring
20
by other carriers . . . I ask my colleagues, why
resort to the pocket of the taxpayer when the
airline industry itself can provide the relief.”
(Cong. Rec. Senate, April 19, 1978, S. 5877. R. 71;
A. 20).
The Court has held that the jury correctly found
McDonald’s rightful date of hire to be January 1982.
Every time Piedmont has hired a non-protected pilot
since then, Captain McDonald has suffered a new and
continuing violation of his First Right of Hire. Piedmont
violated his rights anew after rejecting him in 1987, with
the very next hiring of a non-protected pilot. If Piedmont
hires such a pilot tomorrow, it will again violate
McDonald’s right to be hired first.
How can the Court limit damages as of January 1988
when Captain McDonald’s right to be hired first still
lives? The ongoing violation of his right, and the concom-
itant monetary deprivation, will continue until the end of
his career. Unless the Court orders Piedmont to give
McDonald what Congress ordered it to give, a job, there
is virtually no prospect that McDonald will ever obtain
what the Congress intended him to have, a career with a
covered carrier.
If the Court does order Piedmont to hire Captain
McDonald, is it rational to limit his damages to the period
prior to January 1988? Why should he not recover back
pay until his date of actual hire, as Courts have always
allowed in wrongful failure to hire cases? And if the
Court does not award a job with proper seniority and
back pay, what is to compensate McDonald for his ongo-
ing loss, now and in the future?
21
—
The DOL argues persuasively that the goal of Section
43 can only be met by McDonald's getting a job as a pilot
with a covered carrier. If this Court denies him that job, it
must fairly compensate him for that loss. And the only
possible measure of that loss is the economic value of the
job itself. Anything less than the make whole remedy
applied below will dilute and diminish his right granted
by Congress, denied by an intransigent industry, and
vindicated by a jury.
THE CONGRESSIONAL PURPOSES IN ENACTING
FIRST RIGHT OF HIRE ARE TOTALLY FRUSTRATED
BY THE TRUNCATED MEASURE OF DAMAGES.
There is no enforcement mechanism beyond the
DOL’s power of moral suasion in Section 43(d)(2) to
compel carriers to comply with their duty under 43(d)(1).
Hence a pilot whose First Hire rights have been denied
can seek redress only in the private right of action found
implied in the Act by the trial Court, and ratified by the
Supreme Court in Alaska et al, 480 US at 687, footnote 9.
The Court has, by improperly limiting damages to six
years, defanged the only remedy available. Hence the
carriers are free to continue flaunting their duty, and the
ends of Section 43(d)(1) will continue to be frustrated in
toto.
The report of McDonald’s economic expert, Akins,
found that, on the average, Piedmont saved $240,000 per
man each time it hired a non-protected pilot in the stead
of an older protected pilot. In McDonald's case, the trun-
cated damages would come to somewhere between two
hundred to four hundred thousand dollars, depending on
which of Akins’ assumptions the Judge or a new jury
22
chose to accept. There would be great pressure on
McDonald to settle for far less to avoid the vagaries of a
new proceeding. As a consequence, Piedmont would
roughly break even for its denial of McDonald’s rights.
And, since McDonald is the only pilot to get to trial,
Piedmont and its cohorts have enjoyed a large windfall
profit in each of the thousands of other instances in
which they wilfully defied the mandate of Section
43(d)(1).
McDonald, on the other hand, after the considerabie
expenses of seven years of litigation, prosecuted from
abroad, and legal fees, contingent and otherwise, is left
with virtually nothing, and no prospect of obtaining the
comfortable career promised to him by the Congress.
The jury found Piedmont liable for its wrongful fail-
ure to hire McDonald as of January 1982. That finding,
upheld on appeal, necessarily includes over one hundred
and sixteen months of back pay and the right to exercise
his seniority and begin work as a Captain at the airline, a
position to which he is eminently qualified, having flown
Over six thousand hours in the same Boeing 737-200, -300,
and -400 series airliners Piedmont operates, and over five
thousand of those hours as a Captain, in Europe, North
Africa and the Middle East, during the intervening years
of this litigation.
In Alaska et al, a unanimous High Court exhaustively
plumbed the legislative history of Section 43 to find that
the prime purpose of Section 43(d)(1) was to protect
careers, 480 US 687-697.
23
An even more critical goal of Section 43 was to rein-
vest the acquired experience of protected workers to ful-
fill the first two goals of the Airline Deregulation Act set
forth in §§ 102(a)(1) & (2) thereof (49 USC §§ 1302(a)(1) &
(2)), Appendix 9. When Congress deregulated the indus-
try economically, it had no intent to deregulate safety.
The Civil Aeronautics Board (CAB), which oversaw the
economic regulation of the industry, was sunsetted by the
ADA. But the Congress kept intact the oversight bodies
in charge of insuring safety: the Federal Aviation Admin-
istration (FAA), and the National Transportation Safety
Board (NTSB). And in placing the goals of maintaining
the highest standards of safety ahead of the economic
goals in Section 102 of the ADA, it renewed its mandate
to give safety the highest priority.
To further strengthen and facilitate this mandate,
Congress created Section 43(d)(1) to recycle invaluable
experience. This is why Congress chose First Right of
Hire to be the primary means of employee protection,
and relegated the assistance program to a transitory and
secondary line of attack. See Nance Affidavit throughout,
Appendix 10.
Subsection 1, in effect, makes the maintenance of
safety a condition precedent to any changes induced by
the Act. Subsection 2 sheds a somber light on how the
Congress would view the carriers’ substituting cheap
new entrants for LPP’s, with their wealth of accumulated
experience in and knowledge of the industry. No one can
argue seriously against the proposition that the loss of
accumulated knowledge and experience of LPP’s can
only work against “the prevention of any deterioration in
established safety procedures” or the “furtherance of the
24
highest degree of safety . . . that has evolved in air
transportation”, (§ 102(a)(2)). The Congress, in effect,
would have sacrificed the economic benefits of deregula-
tion on the altar of safety: the carriers have reversed that
priority, and, by hiring new entrants over experienced
LPP’s, have, in fact, sacrificed safety on the altar of greed.
And finally, Section 43(d) obviously was enacted to
ease the passage of the deregulation bill. It was, in effect,
a covenant of the Congress to labor that if the powerful
industry unions accepted deregulation, they would be
guaranteed quality jobs with the surviving established
Carriers.
To understand the interplay of the multiple purposes
of the ADA of 1978, and of Section 43 in particular, one
needs only to consider what the Supreme Court gleaned
from the legislative history.
“But in response to union testimony that the
existing protections were inadequate, and the
support for labor-protection provisions
expressed by administration witnesses, the com-
pensation program and first-hire provisions
were added as Section 22 of $.2493, the bill
introduced in the second session. With the inclu-
sion of the labor provisions, the bill was viewed
as ‘strik(ing) the proper balance between legiti-
mate demands of industry, consumers, labor
and management.’ 124 Cong Rec 10654 (1978)
(remarks of Senator Percy).” Alaska et al, 480 US
at 691-2.
This “proper balance” was the balancing of the
desires of management for the freedom and profit oppor-
tunities of deregulation, of the consumers’ interest in
——rrrrrr—r”—”—"—Ct“ tw
a
=
lower fares, of both the cons :mei» and the industry’s
critical need for maintenance of the highest standards of
safety, and of labor’s desire to conti..ue to have careers
with covered carriers.
But what kind of protectic.. was labor bargaining
for? Anyone familiar with the industry knows that it was
not assistance payments or moving expenses that labor
was seeking. ALPA and the other unions wanted jobs,
and not just any jobs, but career protecting jobs with the
existing established carriers, with all of the prestige, pay,
benefits, union protection and security that labor had so
arduously built up over decades under regulation.
So what has happened to this bargain struck by the
Congress between competing interest groups? Manage-
ment got its profit opportunities and freedom, but then
decided to take the money and run. In order to save the
extra pension costs of invaluably experienced pilots, the
obligated carriers have virtually totally refused to honor
their obligations under the First Hire program. Corporate
arrogance and greed have made a mockery of the Con-
gress’ guarantee of the highest standards of safety (See
Nance Affidavit, Appendix 10) and left a broad swath of
careers and families that Congress promised to protect,
destroyed and devastated.
And, parenthetically, the ADA’s main goal of low-
ering fares and improving service by increasing competi-
tion has also been thwarted. A once vibrant industry,
with fifty-one certificated carriers (as of 24 October 1978),
has been reduced to an oligopoly of eight, four of whom
may soon be swallowed by the remainder, which has
control of ninety-three percent of the business.
26
At stake here are vital national public policy issues.
Can this Court allow corporate greed to mock the cove-
nant of Congress to the flying public that safety should
suffer no dimunition? Or the covenant of Congress to
airline personnel that their careers would be protected by
jobs with established carriers on the other side of the
chaos caused by Congress’ own hand in deregulating?
At issue, too, is the very integrity of the legislative
process itself. If the Congress is to be able to strike
bargains in the future between competing interest groups,
these groups must have faith that the Congress is more
than a purveyor of empty promises.
For the Court to defang First Hire’s only enforcement
mechanism with a remedy so truncated as to profit car-
riers to dishonor First Right of Hire, is to assume Con-
gress would sanction the carriers’ open defiance of its
will, and the carriers’ open breaching of their end of a
bargain so laboriously and fairly struck. No such inten-
tion can be ascribed to a presumably intelligent and
rational legislature.
The Court correctly held that its function is to fashion
a remedy “in light of the statutory language and purpose
and of the traditional modes by which Courts compel
performance of legal obligations”. Opinion, page 13. The
Opinion then internally contradicts itself by misunder-
standing the plain meaning of the statute, and its
intended purposes, and fashions a remedy that is, in
effect, no remedy at all. As Chief Judge Brieant held
below, “Without a remedy, there is no right”. McDonald v.
Piedmont, 625 F Supp 762, 765 (1986).
v
27
CONCLUSION
Piedmont will ask this Court to allow it to import
limits from one prong of the program to the other to
protect itself from its own wrong-doing. The peg a
could not have intended that a carrier be able to flaun
the mandate to hire protected pilots first, and then “at
able to limit its damages with protections erected for
public monies.
M...1 CE
WHEREFORE, for the foregoing reasons, Paul F
McDonald respectfully requests that this Court grant his
Petition for Writ of Certiorari or, in the alternative, to
reverse as to damages and reinstate the full verdict of the
jury.
JOHN G. McDona.p
64 Montgomery Street
Rhinebeck, N.Y. 12572
(914) 876-2696
Counsel for Petitioner
ALBERT J. GAYNOR
One North Broadway
White Plains, N.Y. 10601
(914) 761-2399
Counsel of Record
App. 1
APPENDIX 1
UNITED STATES COURT OF APPEALS
For THE SECOND CircuIt
nes ¢
No. 204 —- August Term, 1990
Argued: September 27, 1990 Decided: April 11, 1991
Docket No. 90-7328
*
Paut. F. McDONALD,
Plaintiff-Appellee,
— against -
PIEDMONT AVIATION INC.,
Defendant-Appellant.
Before:
LUMBARD, NEWMAN, and ALTIMARI,
Circuit Judges.
Appeal from judgment of the Southern District of
New York, Brieant, C.J., entered in favor of plaintiff on
March 29, 1990, after a jury trial. Jury found that defen-
dant denied plaintiff a “first right of hire” under Section
43(d) of the Airline Deregulation Act of 1978, 49 U.S.C.
§ 1552(d) (1988); it awarded compensatory damages of
$2,226,920.
App. 2
Affirmed in part; reversed in part and remanded for
further proceedings to calculate damages.
+
Apert J. Gaynor, White Plains, N.Y. (John G.
McDonald, Rhinebeck, New York, of counsel),
for Plaintiff-Appellee.
Louis B. KimmMe._man, New York, N.Y. (O’Melveny
& Myers, New York, N.Y., Jeffrey I. Kohn, of
counsel), for Defendant-Appellant.
¢
Lumsarp, Circuit Judge:
Piedmont Aviation Inc. appeals from the March 29,
1990 judgment of the Southern District of New York,
Charles L. Brieant, Chief Judge, entered after a jury trial.
The jury concluded that Piedmont had denied McDonald
a “first right of hire” under Section 43(d) of the Airline
Deregulation Act of 1978 (“ADA”), 49 U.S.C. § 1552(d)
(988); it awarded compensatory damages of $2,226,920
for the expected duration of McDonald’s career.
We affirm the finding of liability, reverse the damage
award, and remand for further proceedings to determine
damages available to McDonald under Section 43(d) for
the period of 72 months from the denial of employment.
In 1978, Congress enacted the ADA as part of its
deregulation of the commercial airline industry. Congress
sought to ensure that the benefits to the public flowing
from this deregulation would not be “paid for” by airline
employees who had relied on the heavily regulated
nature of the industry in deciding to accept and to retain
App. 3
positions with commercial air carriers. Alaska Airlines, Inc.
v. Brock, 480 U.S. 678, 680 (1987). The Senate Committee
Report expressed its reasons for providing protection for
individual airline employees as follows:
[A]n individual employee will be able to do
littie to adjust to the new structure. Many airline
employees have given most of their working
lives to the air transportation industry and have
too much invested to leave it now. In many
cases, a job shift even within the industry would
be costly because of lost seniority. Older
employees looking for a new job might encoun-
ter difficulties because of their age. Since
employees will not be ab[lJe to adjust in the
sense their employers can, the Committee
believes that a reasonable program of transition
assistance should be provided.
S. Rep. No. 631, 85th Cong., 2d Sess. 114 (1978).
To assist employees dislocated as a result of deregula-
tion, Congress enacted an employee protection program in
Section 43 of the ADA. Id. at 68-81. Section 43 provides for
benefits, in the event of work force reduction, to those who
are “protected employees.”! See 49 U.S.C. § 1552. Section 43,
subsection d, imposes on airlines certified under the prior
regulatory system a “duty to hire” protected employees
whenever additional employees are hired:
Each person who is a protected employee of an
air carrier which is subject to regulation by the
' A “protected employee” is a person “who, on October
24, 1978, has been employed for at least 4 years by an air
carrier holding a certificate issued under section 1371 of this
title [49 U.S.C.],” excluding any members of the board of
directors or officers of a corporation, 49 U.S.C. § 1552(h)(1).
App. 4
Civil Aeronautics Board who is furloughed or
otherwise terminated by such an air carrier
(other than for cause) prior to the last day of the
10-year period beginning on October 24, 1978
shall have first right of hire, regardless of age, in
his occupational specialty, by any other air car-
rier hiring additional employees which held a
certificate issued under section 1371 of this title
prior to October 24, 1978. Each such air carrier
hiring additional employees shall have a duty to
hire such a person before they hire any other
person, except that such air carrier may recall
any of its own furloughed employees before
hiring such a person... .
49 U.S.C. § 1552(d)(1).
On October 31, 1981, McDonald, a pilot for Air New
England since May 15, 1972, was terminated when the
airline ceased all operations. Because McDonald had been
employed by the carrier for more than four years, he was
a protected employee under Section 43(d). Piedmont con-
cedes that it is subject to Section 43(d)’s duty to hire
protected employees.
On November 19, 1981,2 McDonald submitted a job
application to Janet Cook, who was the secretary of
2 McDonald testified that during a November 2 appoint-
ment with Bill Hall, Piedmont’s director of training, he gave
Hall a supplemental application form, which McDonald had
created. Hall accepted the document and gave McDonald a
Piedmont application form. On November 19, McDonald deliv-
ered the completed application to Piedmont.
At trial, McDonald argued that November 2 was the date
he applied; Piedmont contended that it was November 19.
Because the difference is not relevant to this appeal, we only
note the parties’ disagreement.
App. 5
Captain Fred D. Womack, Piedmont’s director of flight
operations and flight safety, one of three persons at Pied-
mont who interviewed pilot applicants. McDonald’s
application included his relevant work history; he stated
that he left Air New England because the company had
been “liquidated.”
When McDonald delivered his application to Cook,
she told him that he should also submit a resume and his
Air New England flight time summary and that he
should take steps to be qualified as a flight engineer.
McDonald testified that he sent his resume and flight
summary to Piedmont on December 2. On December 14,
McDonald took a written examination to qualify as a
flight engineer. He learned the results of this examination
in two or three days and, within about a week, he tele-
phoned Cook and informed her that he had passed the
examination. After receiving written confirmation that he
had passed the examination, he mailed the results to
Piedmont on January 1, 1982.
Piedmont was hiring pilots at the time McDonald
submitted his application. Classes of pilots began training
on November 16, November 30, January 4, May 24, and
June 7. Each of the five classes consisted of approximately
16 pilots; none of the trainees was a protected employee
under Section 43(d).? In addition, these pilot trainees
3 After the June 7 class, Piedmont adopted a policy of
hiring only protected pilots.
App. 6
were considerably younger than McDonald, who was 37.
None of the trainees was older than 32. The average age
of the members of each class was less than 29. There was
evidence that because the FAA mandates that pilots retire
by age 60, it is considerably more expensive for an airline
to fund the pensions of pilots hired at an olde: age.
Piedmont calculated the average age of these classes to
the tenth of a year.
Piedmont did not acknowledge receipt of
McDonald’s application, request additional information,
or interview McDonald for a pilot position. On February
1, McDonald wrote Piedmont, specifically calling atten-
tion to its duty to hire him under Section 43(d).
McDonald wrote a second letter on April 21, in which he
restated Piedmont’s duty to hire protected pilots regard-
less of age. On April 30, McDonald went to Piedmont’s
training center in person to confirm that Womack had
received the second letter.
At trial, Cook testified that, on April 30, McDonald
came to her office without an appointment and asked if
Womack would see him. Cook told McDonald that
Womack was in a meeting. McDonald then inquired
whether Womack had received the April 21 letter; Cook
responded that she did not know. Cook took a copy of
McDonald’s letter to Womack and asked if he had seen it.
~ Womack told Cook that he had, but that he would not see
McDonald.
When Cook returned to her office and told McDonald
what Womack had said, McDonald remained in her office
staring at her. She said that McDonald's face became red
and he seemed upset. McDonald asked Cook why
App. 7
Womack had not responded to his letter; he asked if Cook
“understood his position.” Finally, he told Cook that he
was going to have to do something he did not want to do,
which would be an embarrassment to him and Piedmont.
McDonald stood in Cook’s office for a few more seconds,
then left.
Cook testified that she was upset and went into
Womack’s office and told him what happened. Womack
reported the incident to Piedmont’s personnel director,
Ray Welch. In a telephone conversation on May 21 and in
a subsequent letter, Welch told McDonald that because of
the April 30 incident Piedmont would give his employ-
ment application no further consideration.
Following notice of Piedmont’s decision not to hire
him, McDonald continued to apply to other airlines and
worked temporarily as a pilot for private individuals and
organizations. In May 1983, he took a job with Trans East
International Airlines and piloted small Cessna and com-
muter aircraft. In October 1983, McDonald obtained a
pilot’s position at Air Berlin, Inc., a small charter com-
pany based in Berlin, Germany, where he continued to be
employed at the time of trial
McDonald's salary at Air Berlin is considerably less
than it would have been at Piedmont. According to the
earnings estimates of McDonald’s expert, Daniel W.
Akins, which the jury credited fully in determining a
verdict, in 1984, McDonald probably would have earned
$68,656 at Piedmont; his actual earnings at Air Berlin
were $33,212. In 1989, McDonald earned $63,149; his
likely earnings at Piedmont would have been $136,777.
Akins estimated that this differential would continue to
App. 8
increase through the duration of McDonald’s career.
While his earnings at Air Berlin would stabilize at about
$60,000, his salary at Piedmont and USAir (Piedmont’s
successor corporation) would eventually exceed $182,000.
In November 1984, McDonald brought an action
against Piedmont in the Southern District, alleging that
Piedmont denied him a first right of hire under Section
43(d). After a trial in March 1990, the jury returned a
verdict for McDonald for $2,226,920, the full amount of
lost wages and employee benefits sought by McDonald
from January 1982 through the expected duration of his
career, to age 60. On appeal, Piedmont challenges the
finding of liability and the damage award.4
Piedmont first contends that the district court erred
in applying a three-year Massachusetts statute of limita-
tions to this action. Piedmont argues that the district
court should have applied the six-month statute of limita-
tions for actions brought under Section 8(a)(3) of the
National Labor Relations Act, 29 U.S.C. § 158 (a)(3)
(1988), or the two-year statute of limitations for claims
arising under the labor protective provisions of the Inter-
state Commerce Act, 49 U.S.C. § 11706(c)(1) (1988). Under
either of these proposed alternatives, McDonald’s claim
would be barred. We disagree with Piedmont’s position,
substantially for the reasons set forth in the district
4 The parties do not dispute and we agree that there is an
implied right of action under Section 43(d). See Long v. Trans
World Airlines, Inc., 913 F.2d 1262, 1265 (7th Cir. 1990);
McDonald v. Piedmont Aviation Inc., 625 F. Supp. 762, 764-65
(S.D.N.Y. 1986); cf. Alaska Airlines, Inc. v. Brock, 480 U.S. 678,
687 n.9 (1987).
App. 9
court’s September 7, 1988 Memorandum and Order. See
McDonald v. Piedmont Aviation Inc., 695 F. Supp. 133
(S.D.N.Y. 1988).
Because Congress did not provide a statute of limita-
tions for Section 43(d), the court must “borrow” one from
another source. See Agency Holding Corp. v. Malley-Duff &
Associates Inc., 483 U.S. 143, 146 (1987). Courts have gen-
erally concluded that Congress intended them to apply
the most closely analogous statute of limitations under
state law. See id.
Applying the Agency Holding analysis, the district
court concluded that the primary federal policy at stake
in a Section 43(d) claim - the assistance of dislocated
employees — would not be frustrated by the application of
a state rule and, therefore, does not require the applica-
tion of a federal statute of limitations. See McDonald v.
Piedmont, 695 F. Supp. at 136, 137. The district court found
no reason to vary from the longstanding practice of
adopting a state statute of limitations in the face of Con-
gressional silence. See id. at 136. It then applied the New
York borrowing statute, Sec. 202 N.Y. Civ. Prac. L. & R.,
under which it determined that a Massachusetts statute
of limitations should apply, as McDonald was a Massa-
chusetts resident and his claim accrued there. See id. at
138. We agree with the district court’s application of the
three-year Massachusetts statute of limitations for actions
of tort. See id.
Second, Piedmont challenges the district court’s
exclusion of evidence purportedly relevant to
McDonald's qualifications for employment. This evidence
includes: 1) testimony of two persons who interviewed
App. 10
McDonald for employment at other airlines; 2) portions
of McDonald’s employment and military records; and 3)
testimony of a purported expert on pilot selection pro-
files. Piedmont argues that this evidence would have
demonstrated that McDonald was unqualified for
employment at Piedmont and, therefore, was not entitled
to a first right of hire under Section 43(d).5 However,
Piedmont concedes it did not have any of this informa-
tion at the time it refused to hire McDonald.
Piedmont contends that the district court erred in
vacating its notice to depose Captain Michael G. Fortune,
who interviewed McDonald for employment at People
Express Airlines, Inc. in late 1981 and rejected him. Pied-
mont sought to depose Fortune on March 5, 1990, 15 days
before the trial began; Piedmont asserted the deposition
was necessary because Fortune would be unavailable to
testify. See Fed. R. Evid. 804(a)(5); (b)(1). According to
Piedmont, Fortune would have testified regarding his
personal impressions of McDonald’s temperament and
suitability as a pilot. Piedmont argued that the testimony
would be relevant to damages and to McDonald’s cred-
ibility.
> To be entitled to a “first right of hire,” a protected
employee must meet an air carrier’s qualifications require-
ments for employment. See 29 C.F.R. §§ 220.11(a), 220.20(a),
and 220.21(a) (1989); Hulsey v. USAir, Inc., 868 F.2d 1423, 1425
n.2 (5th Cir.), cert. denied, 110 S.Ct. 239 (1989); Robinson v.
American Airlines, Inc., 722 F.Supp. 757, 766 (D.D.C.), aff'd, 908
F.2d 1020 (D.C. Cir. 1990); Crocker v. Piedmont Aviation, Inc., 743
F.Supp. 1, 2-3 (D.D.C. 1989), appeal filed, No. 90-7021 (D.C. Cir.
Feb. 23, 1990), argued, January 18, 1991.
neater erm rene em em
App. 11
At a February 23 pretrial conference, the district
court granted McDonald’s request to vacate the deposi-
tion notice because the discovery deadline had passed
and because Fortune’s videotape testimony would be
excluded at trial as being substantially more prejudicial
than probative. See Fed. R. Evid. 403. The district court
clearly acted within its direction in so ruling.
The district court also acted within its discretion in
refusing “for essentially the same reasons” to receive the
same type of testimony from Captain Karen Lee, who
interviewed McDonald for a pilot position with Orion
Air. The district court made this ruling at a conference
held on March 5.
Next, we reject Piedmont’s argument that the district
court erred in excluding portions of McDonald’s military
and employment records, as well as the testimony of Dr.
Robert Helmreich, a psychologist. Piedmont sought to
use the military and employment records in its cross-
examination of McDonald; it intended to present Helm-
reich as a defense witness.
The district court properly excluded all of this evi-
dence. As Piedmont had none of this information at the
time it refuse to hire McDonald, the evidence was irrele-
vant to Piedmont’s liability under Section 43(d). See
Crocker v. Piedmont Aviation, Inc., 743 FSupp. at 3.
Piedmont cannot ignore its statutory obligation to give
first consideration to protected pilots. It made no good
faith examination of McDonald’s application. So far as
Piedmont then knew, McDonald was qualified to be
employed as a pilot. Under the circumstances, Piedmont
may not now be permitted to show what it might have
App. 12
found, which might have been a reason for finding
McDonald not qualified. Consequently, Piedmont is liable
for damages under the Airline Deregulation Act.
Third, Piedmont contends that the district court erred
in instructing the jury regarding the first right of hire
under Section 43(d). Piedmont argues that the instruction
was prejudicial because it permitted the jury to find
liability before McDonald had met its qualifications for
employment, namely the “requirement” that McDonald
be qualified as a flight engineer. We disagree.
In its jury instructions, the district court stated that
“Captain McDonald must prove that he applied; that his
application was complete and in conformity with the rules
and practices of Piedmont... .” The district court further
stated that “[o]nce a pilot meets the qualifications of the
occupational speciality set forth in the statute, his right to
be employed by Piedmont must be preferred... . ”
At trial, Piedmont sought to prove that the flight
engineering examination, or its equivalent, was a prereq-
uisite to employment as a Piedmont pilot. In contrast,
McDonald argued that although Piedmont requested him
to obtain flight engineering qualifications, this was not a
requirement for employment as a pilot. There was evi-
dence that at least one other Piedmont pilot, wo began
training in July 1982, was not so qualified.
We believe the jury was properly instructed to deter-
mine whether McDonald met Piedmont’s requirements
and qualifications for employment. As part of this anal-
ysis, the jury could determine whether successful comple-
tion of the written flight engineering examination was
such a requirement, as Piedmont contends.
App. 13
Piedmont next argues that the district court inade-
quately instructed the jury regarding McDonald’s obliga-
tion to mitigate damages. The district court instructed the
jury as follows:
If you find Piedmont violated the statute and
the violation was a substantial factor in not hir-
ing [McDonald] and caused [McDonald] dam-
age, you may then consider whether Captain
McDonald should have taken any action such as
a reasonable person would have taken under the
circumstances to avoid or reduce his damages.
And if you find he did not, you may reduce his
damages accordingly. If you find that Captain
McDonald’s going to work for Air Berlin satis-
fied this duty to mitigate, then you should
reduce his damages only by the extent of the
amount he received or will receive in salaries
and benefits from Air Berlin.
This instruction fully apprised the jury of
McDonald’s duty to mitigate damages, given the lack of
evidence that he had failed to do so. See Selzer v. Fleisher,
629 F.2d 809, 812 (2d Cir. 1980), cert. denied, 451 U.S. 970
(1981).
Finally, we address Piedmont’s challenges to the
damage award. At trial, Chief Judge Brieant instructed
the jury that damages for a violation of Section 43(d)
were intended “to compensate or make Captain
McDonald whole insofar as possible... .” He further
instructed:
[Y]ou should consider the earnings and benefits
the plaintiff would have received in Piedmont if
he had been hired and pursued a normal career
with that company, minus, less the earnings and
App. 14
benefits plaintiff earns at his present position
with Air Berlin or could have earned elsewhere
in the exercise of due diligence seeking a job as
an aircraft crew member.
The jury thereafter found for McDonald and awarded |
him $2,226,920. This was the amount that McDonald’s
expert witness, Daniel W. Akins, had computed as
McDonald’s adjusted lost earnings and benefits for the
period beginning in late 1981 or early 1982° and ending in
April 2004, when McDonald would retire at age 60.
Piedmont argues that the district court erred in per-
mitting the jury to award compensatory damages for the
expected duration of McDonald’s career. It asserts that
Section 43(d) is part of a temporary transitional assistance
program under which remedies were provided for a lim-
ited period of 72 months. We agree.
Section 43(d) does not specify what damages are
recoverable for the denial of a protected employee’s first
right of hire. Consequently, this court’s “ ‘function is to
decide what remedies are appropriate in light of the
statutory language and purpose and the traditional
modes by which courts compel performance of legal obli-
gations.’ ” Merrill Lynch, Pierce, Fenner & Smith v. Curran,
456 U.S. 353, 376 (1982) (quoting Montana-Dakota Util. Co.
v. Northwestern Pub. Serv. Co., 341 U.S. 246, 261-62 (1951)
6 Based on the amount of the damage award, the jury
found that Piedmont could have placed McDonald in its Janu-
ary 4 class of pilots. The jury discredited Piedmont’s claim that
it had filled the January 4 class before Piedmont had notice of
McDonald’s protected status and McDonald had proved that
he met its employment requirements.
a
App. 15
(dissenting opinion)). In reviewing the statutory lan-
guage, Section 43(d) should be considered in the context
of the entire employee protection program of Section 43.
See N. Singer, Sutherland Statutory Construction § 47.01,
47.02 (4th ed. 1984 & Supp. 1990).
Section 43 consists of two interrelated components.
The first provides for monthly federal assistance pay-
ments while an eligible protected employee is looking for
a new position. See 49 U.S.C. § 1552. Although this pro-
gram was not funded and never became operative, see
Alaska Airlines, Inc. v. Brock, 480 U.S. at 681, assistance
payments were to continue until the protected employee
obtained “reasonably comparable employment” or had
received benefits for 72 months, whichever came first. See
49 U.S.C. § 1552(e). The second aspect of Section 43, set
forth in subsection (d), created a hiring preference to
enable these employees to find reasonably comparable
employment. See id. “The duty to hire provision was
adopted as a supplement for the monthly assistance pay-
ments to reduce and [sic] burden on the federal govern-
ment purse. ...” Crocker v. Piedmont Aviation, No. 86-1673
(RCL) (D.D.C. Feb. 8, 1990), appeal filed, No. 90-7021 (D.C.
Cir. Feb. 23, 1990), argued, January 18, 1991.
Given the language of Section 43 and subsection (d)’s
purpose as a supplement to the temporary monthly assis-
tance payments, we agree that damages recoverable
under Section 43(d) are limited. We hold that a protected
employee can recover damages for the denial of a first
right of hire until the employee obtains employment rea-
sonably comparable to that denied, for a maximum of 72
months.
App. 16
Although the district court did not instruct the jury
to determine whether McDonald’s employment at Air
Berlin was reasonably comparable to that at Piedmont,
we find, because of the enormous pay differential and the
other obvious differences between working as a pilot for
a small German charter company and a large American
commercial air carrier, that the jury could not have deter-
mined that the employment was reasonably comparable.
We conclude that McDonald is entitled to damages for 72
months from January 1982, when he was denied a first
right of hire by Piedmont.
We affirm the jury’s determination of liability but
reverse the award of damages and remand for further
proceedings to determine damages. On remand, the dis-
trict court may, in its discretion, compute damages for 72
months from the evidence given by Daniel W. Akins,
McDonald’s expert, which the jury credited, and use the
remittitur device to order a new trial on damages unless
the plaintiff accepts the reduced sum, as calculated for
the allowable 72 months.
Affirmed in part; reversed in part and remanded for
further proceedings to calculate damages.
App. 17
APPENDIX 2
UNITED STATES COURT OF APPEALS
FOR THE
SECOND CIRCUIT
At a stated term of the United States Court of
Appeals for the Second Circuit, held at the United
States Courthouse, in the City of New York, on the 24th
day of JUNE, one thousand nine hundred and NINETY-
ONE
PAUL F. MCDONALD, DOCKET
PLAINTIFF-APPELLEE, NUMBER
y. 90-7328
84CV8262
PIEDMONT AVIATION, INC. BRIEANT SDNY
DEFENDANT-APPELLANT (Filed
Jun. 24, 1991)
A petition for rehearing containing a suggestion that
the action be reheard in banc having been filed herein by
PLAINTIFF-APPELLEE MCDONALD
Upon consideration by the panel that heard the
appeal, it is
Ordered that said petition for rehearing is DENIED.
It is further noted that the suggestion for rehearing in
banc has been transmitted to the judges of the court in
regular active service and to any other judge that heard
a ee |
App. 18
the appeal and that no such judge has requested that a
vote be taken thereon.
/s/ Elaine B. Goldsmith
Elaine B. Goldsmith
Clerk
App. 19
APPENDIX 3
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
x Civ. Ap. 90-7328
PAUL F. MCDONALD, NOTICE OF MOTION
TO EXTEND TIME TO
FILE, AND SIZE, OF
Plaintiff-Appellee,
~y- PETITION TO REHEAR,
PIEDMONT AVIATION, SUBMIT A DOL AMICUS
NC BRIEF & AN EXPERT
; AFFIDAVIT.
Defendant-Appellant. Stamped FILED by Clerk
. April 25, 1991_
Opposing Counsel
Jeffrey I. Kohn
O'Melveny & Myers
153 East 53rd Street
New York, N.Y
10022-4611
(212) 326-2000
JUDGE OR AGENCY WHOSE ORDER IS BEING
APPEALED
Motion By:
john G. McDonald
64 Montgomery Street
Rhinebeck, N.Y. 12572
(914) 876-2696, 2699
Order dated April 11, 1991 by Judge Lumbard revers
ing the District Court’s Order as to measure of damages
BRIEF STATEMENT OF THE RELIEF REQUESTED
Permission to extend time to file, and size, of Petition
to Rehear, to submit a Department of | abor Amicus Brie!
and an Expert Affidavit
FROM MCDONALD'S AFFIRMAT'ON IN SUPPORT
HEREOF
In this Motion, McDonald requests permission
App. 20
1) To extend the time to file the petition for rehear-
ing to 16 May 1991, and to file more than fifteen pages
2) To submit to this Court a copy of an Amicus Brief
by the Department of Labor dated 29 January 1991, and
filed with the D.C. Circuit Court of Appeals in Crocker v.
Piedmont, supra. The DOL Brief directly contradicts the
interpretation of Section 43 rendered in Crocker and relied
on by this Court.
3) To submit an affidavit by JOHN NANCE, an
industry expert on Deregulation and Safety, on the pur-
pose of Section 43 to reinvest experience to maintain the
highest standards of safety
/s/ John G. McDonald, Attorney for Plaintiff-Appellee
Paul F. McDonald Dated: 24 April 1991
nl ROE R=
Amended*
IT IS HEREBY ORDERED that the motion be and it
hereby is granted.
Stamped FILED by Dated: 7 May 1991
Elaine B. Goldsmith, /s/ Frank X Altimari_
Clerk
May 7, 1991
*to the extent that the Petition does not exceed 25 pages
App 21
APPENDIX 4
Paul F. McDONALD, Plaintiff,
Vv.
PIEDMONT AVIATION, INC.,
Defendant.
No. 84 Civ. 8262 CLB.
United States District Court,
S.D. New York.
lan. 6, 1986
John G. McDonald, Rhinebeck, N.Y., for plaintiff.
Charles C. Read, Diane Patrick, O'Melveny & Myers,
New York City, for defendant
MEMORANDUM AND ORDER
BRIEANT, District Judge
In this action for damages and injunctive relief
brought under 28 U.S.C. §§ 1331 and 1332, plaintiff Paul
F. McDonald alleges that the defendant Piedmont avia-
tion, Inc. violated § 43 of the Airline Deregulation Act of
1978, 49 U.S.C. § 1552, by refusing to give hiring prefer-
ence to the plaintiff as the statute purportedly would
require. Defendant has moved to dismiss or, alternatively,
to stay this action pending resolution of an unrelated case
pending in the District Court of the District of Columbia,
discussed below
App. 22
Section 43, entitled “Employee Protection Plan,” com-
prises two related but discrete provisions: the first pro-
vides for monthly support payments by the Government
to eligible airline workers who had been dislocated by
airline deregulation, while the second imposes a duty
upon the airline industry to give preferential hiring con-
sideration to those dislocated employees in order to obvi-
ate the need for the Government assistance. It is under
this second provision that plaintiff claims his private
right of action arises.
In pertinent part, this subsection reads as follows:
“(d)(1) Each person who is a protected
employee of an air carrier which is subject to
regulation by the Civil Aeronautics Board who
is furloughed or otherwise terminated by such
an air carrier (other than for cause) prior to the
last day of the 10-year period beginning on
October 24, 1978 shall have first right of hire,
regardless of age, in his occupational speciality,
by any other air carrier hiring additional
employees which held a certificate issued under
section 1371 of this title prior to October 24,
1978. Each such air carrier hiring additional
employees shall have a duty to hire such a per-
son before they hire any other person, except
that such air carrier may recall any of its own
furloughed employees before hiring such a per-
son.” 49 U.S.C. § 1552(d)(1).
McDonald’s claim arises out of Piedmont’s decision
in 1981 to hire airline personnel, specifically pilots, who
allegedly did not qualify as “protected emplyees” to
whom preferential hiring treatment was due under § 43.
A protected employee, as defined by the statute, is a
’
App. 23
person other than a corporate director or officer who had
been employed by a certified air carrier for at least four
years prior to October 24, 1978. 49 U.S.C. § 1552(h)(1).
In November 1981, following the cessation of Air
New England where he had been employed as a pilot for
at least seven years, McDonald applied to Piedmont for
employment as a pilot. He identified himself as a pro-
tected employee. One month later, in December 1981,
Piedmont hired a class of pilots consisting entirely of
persons who, McDonald alleges, were not protected
employees. Finally refused employment in May 1982,
McDonald brings this action in an effort to enforce a
“first right of hire” contained in § 43 that he contends
Piedmont is statutorily obligated to honor.
The defendant moves to dismiss this action on two
grounds. Piedmont first argues that § 43 does not create a
private right in the plaintiff as a rejected applicant to
enforce the statute by injunctive or monetary relief, and
that consequently his complaint fails to state a claim
upon which relief can be granted. Piedmont also argues
that whatever rights § 43 conferred had not ripened at the
time McDonald filed his complaint in November 1984
because the Department of Labor regulations intended to
implement the statute have not yet been put into effect.
It is clear that this statute contains no express autho-
rization of a private right of action by a person injured by
a violation of § 43. Nevertheless, there remains for con-
sideration whether a private remedy should be inferred
from the language of the statute and Congressional
intent.
App. 24
Our inquiry begins with analysis of the statutory
language itself, see Touche Ross & Co. v. Redington, 442 U.S.
560, 568, 99 S.Ct. 2479, 2485, 61 L.Ed.2d 82 (1979), apply-
ing the criteria set forth in Cort v. Ash, 422 U.S. 66, 95
S.Ct. 2080, 45 L.Ed.2d 26 (1975). If this language fairly
implies a right to specific and limited relief in federal
court, no additional investigation into Congressional
intent would be required. See Transamerica Mortgage Adui-
sors, Inc. v. Lewis, 444 U.S. 11, 18, 100 S.Ct. 242, 246, 62
L.Ed.2d 146 (1979) (construing § 215 of the Investment
Advisors Act).
In our analysis of the statutory language to ascertain
Congressional intent, we must consider three factors: (1)
whether the statute was enacted for the especial benefit
of the class seeking private enforcement, see Daily Income
Fund, Inc. v. Fox, 464 U.S. 523, 104 S.Ct. 831, 837, 78
L.Ed.2d 645 (1984); Cannon v. University of Chicago, 441
U.S. 677, 690, 99 S.Ct. 1946, 1954, 60 L.Ed.2d 560 (1979);
Cort v. Ash, 422 U.S. at 78, 95 S.Ct. at 2087; (2) whether the
language relied upon creates a right or imposes a duty, or
instead merely proscribes or directs certain conduct, see
Universities Research Association, Inc. v. Coutu, 450 U.S.
754, 771, 101 S.Ct. 1451, 1461, 67 L.Ed.2d 662 (1981);
Touche Ross, supra 442 US. at 569-71, 99 S.Ct. at 2485-86;
and (3) whether the statute sets forth adequate mecha-
nisms for enforcement and relief so as to obviate any
need for private enforcement, see Daily Income Fund, supra
104 S.Ct. at 837; Middlesex County Sewerage Authority v.
National Sea Clammers Association, 453 U.S. 1, 13, 101 S.Ct.
2615, 2622, 69 L.Ed.2d 435 (1981).
The first and second factors are usually examined
together and are given great weight. As the Supreme
App. 25
Court observed in Cannon when it held that Title IX
created a private remedy:
“With the exception of one case, in which the
relevant statute reflected a special policy against
judicial interference, this Court has never
refused to imply a cause of action where the
language of the statute explicitly conferred a
right directly on a class of persons that included
the plaintiff in the case.” Cannon, supra, 441 US.
at 690, n. 13, 99 S.Ct. at 1954 n. 13 (citations
omitted); see Universities Research Association,
supra 450 U.S. at 773, n. 23, 101 S.Ct. at 1462, n.
a3.
By its terms, § 43 establishes a “first right of hire”
and identifies the persons upon whom the right is confer-
red. See 49 U.S.C. § 1552(d)(1). Without a remedy there is
no right. Under Cannon, therefore, a private right of
action may fairly be inferred from the statute absent other
language that specifies particular, exclusive mechanisms
for enforcing those rights. See Daily Income Fund, supra
104 S.Ct. at 837; Middlesex Sewerage Authority, supra 453
U.S. at 13, 101 S.Ct. at 2622.
Scrutiny of the “Employee Protection Plan,” codified
at 49 U.S.C. § 1552, reveals no legislative scheme of
enforcement that would either refute the implication of
the right-giving language quoted above or obviate the
need for it by furnishing an alternative remedy that
would serve adequately the legislative purpose. See Daily
Income Fund, supra 104 S.Ct. at 837. Although Congress
authorized the Department of Labor to “issue, amend,
and repeal such rules and regulations as may be neces-
sary for the administration of this section,” 49 U.S.C.
§ 1552(f)(1), this language cannot be construed to provide
App. 26
the “express statutory remedies” that the Supreme Court
would require in order to deny this plaintiff private
enforcement of his conferred right. See Daily Income Fund,
supra at 837. Where, as here, it is apparent that Congress
granted a class of persons certain specific rights and is
silent on the question of whether those rights should be
enforced by private action, a private remedy may be
implied by the courts unless the legislative history shows
an explicit purpose to deny such enforcement. See Can-
non, 441 U.S. at 694, 99 S.Ct. at 1956, quoting Cort v. Ash,
422 US. 66, 67, 82,95 S.Ct. 2080, 2082, 2089, 45 L.Ed.2d 26
(1975); Neilan v. Value Vacations, Inc., 603 FSupp. 1227,
1235 (S.D.N.Y.1985). The legislative history underlying
§ 43 contains nothing that negates implication of a private
right of action. It focuses primarily upon the monthly
payment assistance program designed to assist dislocated
airline workers in their transition to new employment.
See S.Rep. No. 631, 95th Cong., 2d Sess. 113-17 (1978).
Discussion of the preference hiring requirement was con-
fined to two sentences that reiterated the carrier’s duty to
hire. Id. at 116. Although Congress did not discuss the
mechanics of enforcement, its purpose in enacting § 43 is
clear, and a private remedy would be necessary to effec-
tuate that purpose. To the extent that a private remedy is
“at least helpful to the accomplishment of the statutory
purpose,” the courts have been decidedly receptive to its
implication under the statute. See Cannon, 441 U.S. at 703,
99 S.Ct. at 1961 (citations omitted). Accordingly, this
Court concludes that the language of § 43 will support a
private right of action, and as a result, the complaint does
state a claim upon which relief can be granted.
is
App. 27
The Court now turns to Piedmont’s second conten-
tion supporting its motion to dismiss. Piedmont argues
that the existence of an enforceable right under § 43
depends entirely on the promulgation by the Department
of Labor of rules and regulations designed to implement
the program, as contemplated by § 1552(f). It argues that
the statute, without more, is inadequate to permit the
subject air carriers to satisfy their preferential hiring obli-
gations under the Act and that accordingly it may be
inferred that Congress intended to make the private
enforcement of statutory rights contingent upon the issu-
ance of elaborative regulations. Although this statute
goes back to 1978, there are still no regulations. Proposed
final regulations implementing § 4: were published in the
Federal Register on November 22, 1983, 48 Fed.Reg.
52,854 52,861 (1983), and again on December 27, 1985, 50
Fed.Reg. 53,094, 53,101 (1985) (to be codified at 29 C.FR.
§ 220.01, et seq.), these have not been put into effect,
although whenever bureaucrats are given an opportunity
to make rules, they usually do so. Piedmont argues that
because there are as yet no rules in effect, McDonald’s
rights under the statute, if any, have not yet matured.
This argument has no merit. The argument assumes
that bureaucrats in the Executive Branch, by their mere
inaction in failing to adopt regulations or by involving
themselves in an interminable tug-of-war over minutiae
to be contained therein, could put off indefinitely (seven
years in this case) the effectiveness of a scheme or rem-
edy adopted by Congress that the President did not veto.
Such an assumption may not be made lightly. In any
event, the adoption of regulations is hardly necessary to
the enforcement of § 43 of the Act. As noted earlier, the
App. 28
statute delineates unambiguously the rights and duties of
the parties and identifies specifically to whom they
should apply. See 49 U.S.C. § 1552(d)(1), (h)(1). The
instruction by Congress to the Department of Labor to
propose interpretive regulations for the entire Act does
not diminish the right-giving force of the statutory lan-
guage itself; nor could any such regulation dilute or
repeal such rights, central as they are to the statutory
scheme. Indeed, the rules published in December 1985,
but not yet adopted, offer little guidance. See 50 Fed.Reg.
at 53,101 to 53,105 (to be codified at 29 C.F.R.
§§ 220.01-.51). The proposed 1985 regulations are silent as
to the mechanism for enforcing the right of hire. They do
provide a limited administrative appeal for ascertaining
eligibility in the event of a dispute by an employee who
“disagrees with the carrier’s final determination under
§ 280.25 that he or she is not a protected employee” 50 -
Fed.Reg. 53,103-53,104 (to be codified at 29 C.FR.
§ 220.-26). Without the regulations, the language of § 43 is
sufficiently clear to alert those air carriers who survived
deregulation of their responsibilities, without the neces-
sity of further action pursuant to the rule making power
of the Department of Labor. The proposed 1985 regula-
tions themselves support this conclusion, by expressly
providing that “nothing in these regulations shall pre-
clude the exercise of statutory rights and duties between
October 24, 1978 and the effective date of these regula-
tions.” 50 Fed.Reg. 53,102 [to be codified at 29 C.F.R.
§ 220.01(g)]. The Department, referring explicitly to this
Act, later uses substantially the same language in making
the same point. See id. at 53,105 [to be codified at 29 C.FR.
§ 220.50(c)].
App. 29
Piedmont relies on other language in the proposed
1983 regulations to support its position, specifically
where the Department, in defining scope, announced that
“only those employees who are expressly granted a hir-
ing preference under the Act and these regulations have
any rights under the Rehire Program.” Id. at 53,102 [to be
codified at 29 C.FR. § 220.03(a)]. Even if we assume for
the argument that the class of eligible protected
employees may be smaller if these regulations or similar
ones are adopted than it was before, McDonald will still
be within the class, and this Court declines to infer from
language in regulations not yet adopted that no rights
exist at ali until adoption. Indeed, the Department’s reaf-
firmation of the employees’ statutory rights as recited
above forbids such a conclusion.
Accordingly, Piedmont’s motion to dismiss this
action on this additional ground is denied.
Having concluded that this action is properly before
the court, and that the complaint states a claim, we now
consider defendant’s motion to stay this action pending
resolution of Alaska Airlines Inc., et al. v. Donovan, 594
F.Supp. 92 (D.C.Dist. Col. 1984).
In exercising its discretion to stay an action before it
in favor of a case in another court, a court must be
motivated by considerations of judicial economy, funda-
mental fairness and the orderly administration of justice.
Ordinarily, a court would not be justified in holding in
abeyance a later-filed action such as this one unless the
parties and issues of the concurrent actions are substan-
tially identical. See Kistler Instrumente A.G. v. PCB
App. 30
Piezotronics, 419 FSupp. 120, 123 (W.D.N.Y. 1976). Defendant
here contends that the New York and District of Columbia
cases are substantially identical in all matters except the
parties. Further, it avers that the plaintiff will nct be preju-
diced by deferring to the District of Columbia action because
the issues of concern to McDonald will be adjudicated fully
and his interests protected in the other case; moreover, the
threat of duplicative litigation will be averted.
The identity of these actions is not particularly signif-
icant and would not justify staying this action as defen-
dant requests. Plaintiffs in Alaska Airlines allege that the
first right of hire provision of § 43 violates due process.
While this allegation invites judicial construction of the
entire statute, the significant portion of the complaint
there is directed against the regulations to be promul-
gated under the statute. Thus, the Alaska Airlines case
differs substantially from this action by McDonaid, who
grounds his claims firmly and solely on the specific !an-
guage of the statute itself, independent of any interpreta-
tive regulations that may or may not ever be
promulgated. Since the Alaska Airlines action is so closely
tied to the regulations and their status, and the regula-
tions are not yet in effect, there is really nothing to
litigate at this time.
To submit McDonald’s claim to the delays of an
action that does not mirror substantially his own is pat-
ently unfair.
McDonald’s efforts to define and, he hopes, to vindi-
cate his statutory rights should not be held hostage to the
trial tactics and delays attendant to another action over
which he has no control. Moreover, interests of judicial
economy would not necessarily be served by a stay. A
y
App. 31
decision and judgment in the District of Columbia action
likely would have no claim preclusion or collateral estop-
pel effect against either party to this action under the
rules set forth in Blonder-Tongue Laboratories, Inc. v. Uni-
versity of Illinois Foundation, 402 U.S. 313, 329, 91 S.Ct.
1434, 1443, 28 L.Ed.2d 788 (1971) and Parklane Hosiery Co.,
Inc. v. Shore, 439 U.S. 322, 330, 331, 99 S.Ct. 645, 651, 652,
58 L.Ed.2d 552 (1979); nor would this district court even
be required to reach a consistent result on the due process
issue since the rule of stare decisis is not implicated. See
Newsweek, Inc. v. U.S. Postal Service, 663 F.2d 1186, 1196
(2d Cir.1981), cert. denied sub nom. Council of Public Utility
Mailers v. U.S. Postal Service, 457 U.S. 1133, 102 S.Ct. 2959,
73 L.Ed.2d 1350 (1982); City Stores Company v. Lerner Shops
of District of Columbia, 410 F.2d 1010, 1014 (D.C.Cir.1969);
EEOC v. Pan American World Airways, 576 F.Supp. 1530,
1535 (S.D.N.Y.1984).
This Court upholds plaintiff’s right to chart the
course of his own litigation and to prosecute his claims in
the manner of his choice. See Bell v. Hood, 327 U.S. 678, 66
S.Ct. 773, 90 L.Ed. 939 (1946). The uncertain risks of
inconsistent results or duplicative litigation are not per-
suasive under the facts presently before this Court.
Accordingly, defendant’s motion to stay this action pend-
ing decision in the District of Columbia action is denied.
Counsel for the parties shall confer with regard to
any necessary pre-trial proceedings. A Rule 16 conference
will be held February 13, 1986 at 9:00 A.M. in Courtroom
31, United States Courthouse, 101 East Post Road, White
Plains, New York 10601.
So Ordered.
App. 32
APPENDIX 5
Paul F. McDONALD, Plaintiff,
v.
PIEDMONT AVIATION INC.
Defendant.
No. 84 Civ. 8262 (CLB).
United States District Court,
S.D. New York
Sept. 7, 1988
Involuntarily terminated airline pilot who applied to
another airline for employment filed an action for viola
tion of his rights under the employee protection program
of the Airline Deregulation Act. On airline’s motion for
summary judgment, the District Court, Brieant, Chief
Judge, held that appropriate statute of limitations to bor
row for private action under employee protection provi
sions of the Airline Deregulation Act was the most
closely analagous state, rather than federal, limitations
provision
Motion denied
John G. McDonald, Rhinebeck, N.Y., for plaintiff
Louis B. Kimmelman, O'Melveny & Meyers, New
York City, for defendant
MEMORANDUM AND ORDER
BRIEANT, Chief Judge
In this action for money damages and injunctive
relief brought pursuant to 28 U.S.C. Secs 1331 and 1332
£ k
ererearereeeersssiaiaaaaaassssiaanarsemmemrmmemenimelle
A pp 33
the plaintiff alleges that the defendant violated Sec. 43 of!
the Airline Deregulation Act of 1978 (“the ADA”), 49
U.S.C.App. Sec. 1552, by refusing to give hiring prefer
ence to the plaintiff. This Court previously determined
that Sec. 43 supported an implied private right of action
McDonald v. Piedmont Aviation Inc., 625 F.Supp. 762 (S.D
N.Y.1986). Although, this interlocutory order was not
amenable to immediate appellate review, or decision was
cited with approval on March 27, 1987 by the Supreme
Court in Alaska Airlines v. Brock, 480 U.S. 768, n.9, 107
S.Ct. 1476, 1482 n. 9, 94 L.Ed.2d 661
Defendant now moves for summary judgment on the
ground that the plaintiff's claim was filed untime ly. This
motion presents a question of first Impression in this
Circuit: what is the appropriate statute of limitations to
borrow for an action under Sec. 43(d) of the ADA? The
motion was fully submitted for decision on July 27, 1988
hereafter, the Court received, and considered, a lette
from defendant's attorneys docketed August 19, 1955
Through the ADA, Congress sought to deregulate the
airline industry and make it more competitive Alaska
Airlines v. Brock, supra (citing $.Rep. No. 95-631, p. 5.
(1978)). Confident that deregulation would lead to eco
nomic benefits for the public, but also aware that it would
lead to dislocation of airline employees, Congress enacted
the Employee Protection Program (’ EPP”) in Sec. 43, as
part of the ADA. Id. The program provides for benefits to
‘protected employees,” defined as employees who had
been employed by a certified carrier for at least four
years prior to October 24, 1978, Se 43(h)(1), and were
affected by workforce reductions. The first part of the
EPP provides for monthly assistance payments from the
——
App. 34
Federal Government to eligible employees who have been
dislocated as a result of airline deregulation. Sec
43(a)-(c), (e).
The second part of the EPP imposes upon the airline
industry a “duty to hire” such protected employees. This
subsection, Sec. 43(d)(1), provides in relevant part:
“Each person who is a protected employee of an
air carrier which is subject to regulation by the
Civil Aeronautics Board who is furloughed or
otherwise terminated by such an air carrier
(other than for cause) prior to the last day of the
10-year period beginning on October 24, 1978
shall have first right of hire, regardless of age, in
his occupational specialty, by any other air car-
rier hiring additional employees which held a
certificate issued under section 1371 of this title
prior to October 24, 1978. Each such carrier hir-
ing additional employees shall have a duty to
hire such a person before they hire any other
person, except that such air carrier may recall
any of its own furloughed employees before
hiring such a person.”
49 U.S.C.App. Sec 1552(d)(1). McDonald bases his claims
upon rights granted him as a “protected employee”
under this second provision
In October, 1981 Air New England, Inc. ceased opera-
tions, and the plaintiff, who had worked there as a pro-
fessional commercial airline pilot for at least seven years,
was involuntarily terminated. In November, 1981 the
plaintiff alleges that he applied to Piedmont for employ-
ment, and one month later Piedmont hired a class of
employees allegedly consisting entirely of non-protected
App. 35
employees. The plaintiff requested that Piedmont recon
sider his application in light of his protected position
under Sec. 43 of the ADA. In a letter dated May 28, 1982,
Mr. L.R. Welch, Jr, Director of Personnel Administration
for Piedmont, informed Mr. McDonald that his applica-
tion had been removed from Piedmont’s active file and
would receive no further consideration. Mr. McDonald
filed this action on November 15, 1984, approximately
two and a half years after he received notice from Pied-
mont that his application was no longer being consid-
ered
Defendant now moves for summary judgment on the
basis that the claim is time-barred by the relevant statute
of limitations
Congress did not provide a statute of limitations for
Sec. 43 or any other provision of the ADA, therefore, this
Court must “borrow” the most suitable rule of timeliness
from another source. Agency Holding Corp. v. Malley-Duff
& Associates Inc., wu. __, 107 S.Ct. 2759, 2762, 97
L.Ed.2d 121 (1987)
[he Supreme Court in Agency Holding outlined the
relevant considerations in determining the appropriate
statute of limitations. The Court stated that when a fed
eral statute fails to specify a limitations period, the gen
eral assumption is that Congress intended by its silence
that the court borrow a state statute of limitations. Id
This assumption that state law applies is based upon the
longstandirg practice of the courts, and Congressional
f
awareness of that practice. Id.
[he Supreme Court noted, however, that in some
limited circumstances, state statutes of limitations would
App. 36
be unsatisfactory vehicles for the enforcement of federal
law, and in those circumstances, it would be inappropri-
ate to conclude that Congress would choose to adopt a
state law at odds with federal substantive law. Id. (quot-
ing DelCostello v. Teamsters, 462 U.S. 151, 161, 103 S.Ct.
2281, 2289, 76 L.Ed.2d 476 (1983)). The Supreme Court
found that the circumstances under which it is more
appropriate to borrow a limitations period found in a
federal, rather than state, statute are:
“[W]hen a rule from elsewhere in federal law
clearly provides a closer analogy than available
state statutes, and when the federal policies at
stake and the practicalities of litigation make
that rule a significantly more appropriate vehi-
cle for interstitial lawmaking .. . ”
Id., 107 S.Ct. at 2763 (quoting DelCostello, supra, 462 U.S.
at 171-172, 103 S.Ct. at 2294). In Agency Holding the Court
concluded that the circumstances for applying a federal
statute of limitations were met, and adopted the limita-
tions period found in the Clayton Act to apply to civil
claims under RICO.
Defendant argues that a uniform federal statute of
limitations is needed for all Sec. 43(d) claims. The defen-
dant claims that federal labor policy is directly implicated
by Sec. 43(d), and therefore, the goals of uniformity and
quick resolution of labor disputes require adoption of a
relatively short statute of limitations. The defendant also
notes that it is a national employer, subject to suit in
every jurisdiction in which it flies, and therefore, a fed-
eral statute of limitations should be adopted to avoid
perceived evils of forum-shopping. The defendant then
offers as the closest analogy to a claim of violation of the
App. 37
first right of hire provision of Sec. 43(d), a claim of unfair
labor practice for discriminatory hiring in violation of
Sec. 8(a)(3) of the NLRA, to which the six month statute
of limitations in Sec. 10(b) of the NLRA, 29 U.S.C. Sec.
160(b), applies. In the alternative, the defendant proposes
that a claim under Sec. 43(d) be considered analogous to
claims arising under the labor protective provisions of the
Interstate Commerce Act, 49 U.S.C. Sec. 11347, and that
the two year statute of limitations applicable to actions to
enforce rights under the Interstate Commerce Act, 49
U.S.C. Sec. 11706(c)(1), Modin v. New York Central Co., 650
F.2d 829, 833-34 (6th Cir.), cert. denied, 454 U.S. 967, 102
S.Ct. 512, 70 L.Ed.2d 384 (1981), be applied.
Defendant has called our attention to Gonzales v
Aloha Airlines, Inc., 669 F.Supp. 1023, 1025 (D. Hawaii
1987), in which the District Court borrowed the NLRA six
months statute of limitations in a Section 43 case, analo-
gous to the instant case, as well as another Hawaii district
court case, Bigelow v. Hawaiian Airlines, Inc., 696 F.Supp.
1356 (1987), which followed the decision in Gonzales
Those decisions have, of course, no precedential force in
this Circuit. Defendant also directed the Court by letter to
a decision in the United States District Court for the
District of Columbia, Crocker v. Piedmont Aviation, Inc.,
696 "Supp. 685 (D.D.C.1988), in which the Court held
that the three year District of Columbia “catch-all” statute
of limitations should be followed for certain claims under
Section 43(d). This opinion also lacks precedential force
in this Circuit.
After considering the factors outlined by the
Supreme Court in Agency Holding, this Court concludes
that Sec. 43(d) does not require that a federal statute of
nl
App. 38
limitations be applied, and adopts the most closely analo-
gous New York State limitations period.
While it may be that the federal statutes set forth by
the defendant provide a closer analogy to a cause of
action under Sec. 43(d) than any state rule, and that the
practicalities of litigation against a multistate employer
point toward the adoption of a uniform federal statute, -
those are not the only factors to be considered by this
Court. As the Supreme Court explained in Agency Hold-
ing: “the mere fact that state law fails to provide a perfect
analogy to the federal cause of action is never itself
sufficient to justify the use of a federal statute of limita-
tions...” Id., 107 S.Ct. at 2762. Furthermore, the fact that
adoption of a state rule may lead to forum-shopping,
which could not occur in this forum for reasons which
will be noted below, or to litigation concerning which
statute applies, are insufficient, alone or together, for a
court to go against the traditional practice of selecting a
state statute of limitations. This Court must also consider
whether the federal policies at stake make a federal rule
significantly more appropriate than a state rule. /d. at
2763.
This Court concludes that the federal policies at stake
in a Sec. 43(d) claim would not be frustrated by the
adoption of a state rule, and do not require the adoption
of a federal statute of limitations. The Court finds no
reason here to vary from the longstanding practice of
adopting a state statute of limitations in the face of Con-
gressional silence. The Employee Protection Program
enacted in Sec. 43 of the ADA represents a humanitarian
attempt by Congress to ensure that the benefits of dereg-
ulation would not be “paid for” solely by airline
App. 39
employees. Alaska Airlines, Inc. v. Brock, 480 U.S. at __,
107 S.Ct. at 1478. The intent of Congress in passing this
legislation is explained in the Committee Report on S.
2493, the Senate bill which contained the protections for
employees that became the core of the EPP. H.R.Conf.
Rep. No. 95-1779, p. 105 (1978), U.S.Code Cong. &
Admin. News 1978, 3737. The report states in relevant
part:
“{[A]n individual employee will be able to do
little to adjust to the new structure. Many airline
employees have given most of their working
lives to the air transportation industry and have
too much invested to leave it now. In many
. cases, a job shift even within the industry would
be costly because of lost seniority. Older
employees looking for a new job might encoun-
ter difficulties because of their age. Since
employees will not be ab[l]e to adjust in the
sense their employers can, the Committee
believes that a reasonable program of transition
assistance should be provided.
“ .. The Committee believes that the Congress,
on behalf of the American people, must insure
that the benefits of the public which result from
its decision to alter substantially the regulation
of air transportation are not paid for by a minor-
ity — the airline employees and their families
who have relied on the present system.” S.Rep.
No. 95-631, p. 114 (1978).
The Senate Committee Report, and the language of
the statute itself, make it clear that the primary purpose
of Congress in passing the EPP was to protect individual
employees from the negative impact of deregulation.
Through this provision Congress was attempting to
App. 40
relieve some of the hardship foreseeably affecting airline
employees. Protection of employees is the primary goal
of Sec. 43 of the ADA, and that is the key distinction
between this case and DelCostello v. Teamsters, 462 U.S.
151, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983) and, Robinson v.
PanAmerican World Airways, Inc., 777 F.2d 84 (2d Cir.1985),
where courts determined that adoption of a federal stat-
ute was appropriate and applied the six month limita-
tions period of Sec. 10(b) of the NLRA to federal causes of
action.
The decision in DelCostello involved a suit by an
employee alleging that an employer had breached a pro-
vision of the collective-bargaining agreement, and that
the union had breached its duty of fair representation by
mishandling the ensuing grievance-and-arbitration pro-
ceedings. 462 U.S. at 163, 103 S.Ct. at 2289-90. The
Supreme Court concluded that Sec. 10(b) was the applica-
ble statute of limitations governing the suit, finding that
the hybrid Sec. 301/fair representation claim amounted
to a direct challenge to the private settlement of disputes
under the collective bargaining agreement. Id. at 165, 103
S.Ct. at 2291. The Court stated that the federal statute of
limitations selected was designed to accommodate the
balance of interests present in this type of action, specifi-
cally the interest in allowing an aggrieved employee a
satisfactory opportunity to vindicate his rights, and the
national interest in stable bargaining relationships and
finality of private settlements. Id. at 171, 103 S.Ct. at 2294.
In Robinson, our Court of Appeals applied Sec. 10(b)
to a former airline employees’ action for termination
allegedly due to their pro-union activities. The action was
brought under the Railway Labor Act, 45 U.S.C. Sec. 151
App. 41
et seg., which establishes a scheme for the resolution of
labor disputes in the rail and transportation industry. 777
F.2d at 85. The Court defined the two key policy goals
behind the RLA as speed, to prevent the disruption
caused by prolonged labor disputes in the transportation
industry, and uniformity, due to the interstate nature of
the employer. Id. at 87. The Court stated that the key
question in determining whether to apply Sec. 10(b) was
whether the dispute necessitated uniform and speedy
settlement because it arose out of a labor-management
relationship. The Court found that the plaintiff’s claim
presented such a case since the “discharge of pro-union
employees at a time when a union is attempting to orga-
nize and represent the employees is the typical labor
dispute raising the [relevant] labor-management con-
cerns...” Id. at 89.
The disputes in DelCostello and Robinson directly
affected the consensual processes that federal labor law is
chiefly designed to promote - the formation of a collec-
tive bargaining agreement and the private settlement of
disputes under it. Thus, significant goals of labor policy
would be frustrated through lack of uniformity or failure
to resolve the dispute quickiy. Under such circumstances,
adoption of a federal statute of limitations is appropriate.
Auto Workers v. Hoosier Cardinal Corp., 383 U.S. 696, 702,
86 S.Ct. 1107, 1111, 16 L.Ed.2d 192 (1966).
In contrast, the Employee Protection Program in Sec.
43(d) does not directly affect industrial peace or the con-
duct of labor relations under a collective bargaining
agreement. It provides remedial benefits through the first
right of hire to individuals who lose their jobs due to
—neamieeaeaa eae ana
App. 42
action taken by Congress to deregulate the airline indus-
try. While some labor issues may be indirectly implicated,
such as seniority rights, the primary policy to be pro-
moted by the legislation, the assistance of dislocated
employees, would not be frustrated through the applica-
tion of a state statute of limitations. Courts should apply
the state rule in the absence of Congressional direction to
the contrary. Such would be the expectation of Congress.
The defendant argues that the limited duration of the
first right of hire provisions of the EPP support a short
statute of limitations. The statute defines “protected
employees” as those who are separated from employment
between October 24, 1978 and October 24, 1988. This
Court concludes, however, that this time limit was chosen
to define the group eligible for the benefits of the EPP,
and is unrelated to the right of any one of them to bring a
cause of action to enforce his rights, once established.
Furthermore, ten years is a relatively long period to allow
for the full effects of deregulation to be felt in the indus-
try.
The Court must now consider which state rule to
apply to this lawsuit. Since Mr. McDonald is a Massa-
chusetts resident (Complaint, Para. 4, 5), and his claim
accrued there, this Court, under Sec. 202, N.Y.Civ.Prac.L.
& R., must borrow a statute of limitations from the laws
of Massachusetts because New York would do so to avoid
forum shopping. The Court concludes that the three year
statute of limitations found in Mass.Gen. Laws Ann. Ch.
260, Sec. 2A for actions of tort applies to this case. The
defendant allegedly violated its affirmative duty to plain-
tiff under Sec. 43(d) to give him preferential hiring treat-
ment, causing economic injury to the plaintiff, and
LLL
App. 43
perhaps entitling him to injunctive relief. While the court
notes that an action in tort and an action under Sec. 43(d)
are not identical, the lack of a perfect analogy alone is not
grounds to discard a state rule. Agency Holding, 107 S.Ct.
at 2762.
Based upon the foregoing, the Court concludes that
the plaintiff’s action was timely filed, and, therefore,
denies the defendant’s motion for summary judgment on
the ground of the statute of limitations.
Counsel for the parties shall attend a final pretrial
and status report conference before me on October 12,
1988 at 9:00 a.m. in Courtroom 31, United States Court-
house, 101 East Post Road, White Plains, New York, at
which time an early trial date will be established by the
Court. Please submit a statement of issues to be tried,
separately numbered, together with voir dire requests
and requests to charge.
So Ordered.
App. 44
APPENDIX 6
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
X
PAUL F. MCDONALD,
imen 84 Civ. 8262 (CLB)
-against- : MEMORANDUM
PIEDMONT AVIATION, INC., * AND ORDER
Defendant.
X
Brieant, Chief Judge
Plaintiff moves for partial summary judgment on
liability pursuant to Fed.R.Civ.P. 56, supported by the
affidavits of Capt. Paul F. McDonald, Bruce H. Weiland,
and John G. McDonald. Familiarity of the reader with all
prior proceedings is assumed. In support of his motion,
plaintiff asserts that Piedmont was obligated by § 43(d) of
the Airline Deregulation Act of 1978 to honor the hiring
preference imposed by the Act for October 24, 1978
through October 24, 1988, and to hire Capt. McDonald
when he applied for employment as a pilot with Pied-
mont in November 1981. This motion was fully submitted
for decision on February 21, 1989, and is resolved as
follows.
In October 1981, Air New England (ANE) ceased
operations, and the plaintiff, who had worked there as a
professional commercial pilot for at least seven years,
was terminated. In November 1981, the plaintiff applied
to Piedmont for employment as a pilot, and one month
ee
App. 45
later Piedmont allegedly hired a class of employees con-
Sisting entirely of non-protected employees.
Capt. McDonald asserts in support of his motion that
Piedmont passed over his application in favor of non-
protected pilot applicants. Piedmont disputes Capt.
McDonald’s factual assertion that it hired non-protected
employees at a time when McDonald was qualified for
employment. Piedmont states that it has been hiring its
new pilots exclusively from the ranks of “protected
employees” as defined in § 43 of the ADA since July 1982,
and that there is still extensive competition for positions
due to the size of the “protected employee” applicant
pool.
Plaintiff contends that he should have been the next
pilot hired by defendant Piedmont after November 1981,
when he submitted his application for employment.
However, defendant argues that it had no obligation to
accord him special treatment under the first right of hire
provision of § 43, if at all, until February 1, 1982. It
appears that plaintiff did not formally notify Piedmont of
his protected status until February 1, 1982, when he met
with Capt. Womack, Piedmont’s Director of Flight Opera-
tions, at Piedmont in Winston-Salem, North Carolina, and
requested that Piedmont consider his application in light
of his protected position under § 43. Plaintiff believes that
the defendant’s employees and officers knew when he
applied that he was a protected employee under § 43 of
the Airline Deregulation Act and were aware of their
obligations under the Act, and that he was under no
obligation to formally notify Piedmont of the law or his
status under it.
App. 46
Defendant further states that, at the time that Capt.
McDonald applied for employment, he failed to satisfy
Piedmont’s minimum qualifications and requirements for
consideration for employment because he had not com-
pleted the flight engineer’s written exam and did not
have a flight engineer’s rating. This requirement was not
fulfilled by plaintiff until January 4, 1982, and therefore
Piedmont claims that any duty to hire plaintiff could not
have arisen before that date at the earliest.
Piedmont asserts that, after February 1, 1982, when
Capt. McDonald satisfied Piedmont’s minimum require-
ments and Piedmont was notified of Capt. McDonald's
protected status, the next class to be hired was selected
on or about May 11, 1982. By that time, however, Pied-
mont states that Capt. McDonald had disqualified himself
from employment as a result of his alleged conduct dur-
ing an incident occurring on April 30, 1982.
In a letter dated May 28, 1982, Mr. L.R. Welch, Jr.,
Director of Personnel Administration for Piedmont,
informed Capt. McDonald that his application had been
removed from Piedmont’s active file and would receive
no further consideration due to his behavior during an
April 30, 1982 visit to Capt. Womack’s office. Piedmont
asserts that, during the April 30 visit, plaintiff harassed
Capt. Womack’'s secretary, Janet Cook, in an effort to gain
access to Capt. Womack’s office to discuss his employ-
ment application. Plaintiff denies that any incident
occurred, and argues that, in any event, it is irrelevant
because defendant was obligated to hire plaintiff in
November 1981. Plaintiff also alleges that his application
was rejected because Piedmont has a company policy
imposing a cut-off age of 33 for hiring of pilots
App. 47
Thus, at the very least, there is a disputed issue of
material fact as to what Capt. McDonald said and did at
Piedmont’s Training Center on April 30, 1982, and
whether such conduct arose before or after the claim sued
on here arose
In order for plaintiff to be entitled to a “first right of
hire” under § 43(d) and therefore to summary judgment,
he would have to establish each of the following elements
by a preponderance of the evidence
(1) plaintiff must be a ‘protected employee’ of
an air carrier subject to Civil Aeronautics Board
regulation, 49 U.S.C. § 1552(d); (2) he must have
been furloughed or terminated, other than for
cause, by such air carrier during the ten-year
period beginning October 24, 1978; and (3) Pied
mont must hold a certificate under 49 U.S.¢
§ 1371 issued prior to October 24, 1978 and must
be ‘hiring additional employees.’ 49 U.S.¢
§ 1552(d).
All of these elements have been shown by plaintiff and
admitted by Piedmont. Piedmont asserts, however, that
these facts, alone, do not give plaintiff an unqualified
right to be hired. Piedmont contends that, before the right
matures and any duty to hire arises, an applicant must
show that (1) all of Piedmont’s requirements and quali
fications for employment as a pilot have been fulfilled,
and (ii) Piedmont has been given notice of the applicant’s
protected status under the statute
Plaintiff’s summary judgment motion is denied on
the ground that there are disputed issues of fact as to
when defendant Piedmont knew of plaintiff S protected
App. 48
Status, whether plaintiff had fulfilled Piedmont’s mini-
mum requirements for consideration for employment,
and whether Piedmont had cause not to hire Capt.
McDonald because of the April 30, 1982 incident despite
his protected status. All of these issues must be tried to a
jury.
SO ORDERED.
Dated: White Plains, New York
April 27, 1989
Charles L. Brieant
Charles L. Brieant
Chief Judge
App. 49
APPENDIX 7
JURY INSTRUCTIONS RE MEASURE OF DAMAGES in
McDonald v. Piedmont Aviation, Inc., in the United States
District Court for the So. District of New York, (No. 84
Civ. 8262 CLB).
[p. 709] Now, if you find that Captain McDonald is
entitled to recover on his claim for the defendant’s breach
of a statutory duty to employ him, then you may consider
awarding the plaintiff, Captain McDonald, damages in
money. If you do not find liability, that is to say if you do
not find that Piedmont’s violation of Section 43 D was the
reason or a substantial factor in the reason for the failure
to hire the plaintiff, then there is no need to consider the
damages and you simply report a verdict in favor of the
defendant.
[p. 710] Now, the fact that | am discussing damages
with you in connection with this matter is not to be taken
by you as any indication that damages should or should
not be awarded, that’s for you to decide. As | told you
earlier, that decision is yours and yours alone. If you find
the defendant liable to Captain McDonald for a statutory
violation, and you find that he has been damaged by the
failure to hire him as a protected pilot, you will award the
plaintiff such amount in money as in the exercise of good
judgment and common sense you find is fair and just
compensation for the actual fair losses sustained by the
plaintiff. In fixing the amount you should consider the
earnings and benefits the plaintiff would have received in
Piedmont if he had been hired and pursued a normal
career with that company, minus, less the earnings and
benefits plaintiff earns at his present position with Air
App. 50
Berlin or could have earned elsewhere in the exercise of
due diligence seeking a job as an aircraft crew member. In
computing a damage award you must base your comput-
ations on your fair and reasonable evaluation of all the
evidence. You may not engage in any speculation or
guesswork. You can consider evidence of hours actually
worked, maximum and minimum salaries, nonsalary ben-
efits, including unemployment and other insurance, such
as sick pay, disability pay, pensions and the like. All those
things may be considered by you in [p. 711] arriving at a
figure. In computing damages you need not limit yourself
to statistics; and the evidence of so-called statisticians or
other expert witnesses are never binding or controlling
on the jury. You simply consider it for such weight and
significance and value that you think it has. In making a
damage award, you should also consider the possibility
that the plaintiff, if he had been hired by Piedmont, might
not finish the training school; that he might not live to the
expected age or retired; or that he might have a loss of
health so he would not have a certificate to fly; or some
other occurrence might happen wherein he would not
continue to be a full-time employee of Piedmont for the
entire period estimated in the Akins report; and you can
consider all the other facts in the case and use your best
judgment considering all the evidence in the case in
computing a damage award that wil! be fair to both sides.
Damages of the type that I have been discussing with
you are compensatory; that is to say, they are intended to
compensate or make Captain McDonald whole insofar as
possible and place him in the economic position he would
App. 51
have been in if the statute had not been violated, assum-
ing you find there was such a violation and if the viola-
tion had not caused damage. Damages of this type are not
given to punish anybody or for any other purpose
beyond fair and just [p. 712] compensation for statutory
violation. .
The losses considered are economic losses only and
- there is to be no award for emotional distress or annoy-
ance or provocation or anything like that. This is purely a
lost wages and lost benefits situation for your consider-
ation. If you find that the salaries and benefits he would
have earned at Piedmont would be received over a period
of future time, you should discount any damage award to
give due regard for the discounted value of money paid
now for something to become due in the future, because
any verdict for damages in this case will be paid upon the
entry of judgment. Although you will understand that
future salary won’t be received for many years to come,
you can use your own knowledge of the interest rates,
and you may consider the rate of inflation in the country
as affecting value now of payments in the future.
This matter, like all matters concerning damages, is
something for you to exercise your common sense. And
as I said earlier, we’re talking about compensatory dam-
ages intended to make him whole in the matter, not for
the purpose of conferring a benefit or punishing anybody.
There is one other matter that has to be mentioned
whenever compensatory damages are being claimed;
that’s this, any person who is damaged has a duty to
mitigate or reduce his or her damages by taking such [p.
713] reasonable actions as an ordinary, reasonable person
App. 52
such as any of you would take under the circumstances.
For example, if someone has claimed damages for lost
wages due to a back injury on the job, and the doctor
advises surgery of a reasonable sort which a reasonable
person would undergo, then a plaintiff can’t refuse the
surgery and thereby fail to reduce his damages by putting
himself in a position where he can go back to work. It’s
the same way in a first right of hire case. If you find
Piedmont violated the statute and the violation was a
substantial factor in not hiring the Plaintiff and caused
the plaintiff damage, you may then consider whether
Captain McDonald should have taken any action such as
a reasonable person would have taken under the circum-
stances to avoid or reduce his damages. And if you find
he did not, you may reduce the damages accordingly. If
you find that Captain McDonald’s going to work for Air
Berlin satisfied this duty to mitigate, then you should
reduce his damages only by the extent of the amount he
received or will receive in salaries and benefits from Air
Berlin.
App. 53
APPENDIX 8
UNITED STATES COURT OF APPEALS
DISTRICT OF COLUMBIA CIRCUIT
X
HOBART N. CROCKER, JR.,
ee No. 90-7021
id D.C. No. 86-01673
PIEDMONT AVIATION, INC.,
Appellee.
X
Argued January 18, 1991
Decided
May 24, 1991
Pierre Murphy, with whom Robert M. Beckman and
David M. Kirstein were on the brief, Washington, D.C.,
for appellant.
Richard G. Parker, with whom Donald T. Bliss and
James J.R. Talbot were on the brief, Washington, D.C., for
appellee.
Elizabeth Hopkins, Ailen H. Feldman and Steven J
Mandel, Attys., Dept. of Labor, entered appearances.
Washington, D.C., for amicus curiae urging reversal.
Before MIKVA, Chief Judge, and SENTELLE and
HENDERSON, Circuit Judges.
Opinion for the court filed by Circuit Judge HEN-
DERSON.
App. 54
HENDERSON, Circuit Judge:
Hobart N. Crocker, Jr., brought this action alleging
that Piedmont Aviation, Inc. violated section 43(d) of the
Airline Deregulation Act, Pub. L. No. 95-504, 92 Stat. 1705
(1978), by failing to accord Crocker a hiring preference
after he lost his position as a pilot with a regulated,
certificated airline following deregulation of the airline
industry. The district court granted summary judgment in
Piedmont’s favor, concluding that Crocker lost his section
43(d) right of first hire before the alleged violation when
he obtained employment with a noncertificated com-
muter airline. 741 F.Supp. 241. Crocker now appeals the
district court’s judgment asserting that his first-hire right
survived his hiring by the noncertificated carrier. We
agree with Crocker that employment by a noncertificated
carrier does not extinguish a section 43(d) first-hire right
and, therefore, reverse the district court.
I.
On Appeal from a grant of summary judgment, we
must view the record in the light most favorable to the
appellant. Williams v. Mordkofsky, 901 F.2d 158, 160
(D.C.Cir.1990). So viewed, the record reveals the follow-
ing facts.
In 1971 Crocker began employment as an airline pilot
for Air New England, a regulated airline holding a certifi-
cate of public convenience and necessity from the Depart-
ment of Transportation. In 1978, while Crocker was so
employed, Congress passed the ADA which largely freed
the airlines from government regulation. See Alaska Air-
lines, Inc. v. Brock, 480 U.S. 678, 680, 107 S.Ct. 1476, 1477,
App. 55
94 L.Ed.2d 661 (1987). Seeking “to ensure that the benefits
to the public flowing from this deregulation would not be
‘paid for’ by airline employees who had relied on the
heavily regulated nature of the industry in deciding to
accept and to retain positions with commercial air car-
riers,” Congress enacted section 43 of the ADA, the
“Employee Protection Program,” 49 U.S.C. app. § 1552,
(EPP), “in order to assist employees dislocated as a result
of deregulation.” Alaska Airlines, 480 U.S. at 680-81, 107
S.Ct. at 1478.
The EPP, as enacted, provides two benefits for a
displaced airline employee who qualifies as a “protected
employee,” that is, an employee who “on October 24,
1978, ha[d] been employed for at least 4 years by an air
carrier holding a certificate issued under section 1371 of
[the appendix to title 49].” 49 U.S.C. app. § 1552(h)(1).
First, the EP provides for payment from a government
fund of a “monthly assistance payment” to a protected
employee who loses his job or suffers financial loss as a
result of a bankruptcy or severe work force reduction
caused by deregulation. See 49 U.S.C. app. § 1552(a), (b),
(h); Alaska Airlines, 480 U.S. at 681 & n. 1, 107 S.Ct. at 1478
& n. 1.! Second, subsection (d) of the EPP guarantees a
right of first hire under certain circumstances for a dis-
placed protected employee:
' Because Congress made those payments “subject to such
amounts as are provided in appropriation Acts,” 49 U.S.C. app.
§ 1552(a)(1), and because no money was ever appropriated for
them, the financial assistance provisions have never been
implemented. See Alaska Airlines, 480 U.S. at 681, 107 S.Ct. at
1478.
App. 56
Each person who is a protected employee of an
air carrier which is subject to regulation by the
Civil Aeronautics Board who is furloughed or
otherwise terminated by such an air carrier
(other than for cause) prior to the last day of the
ten year period beginning on October 24, 1978
shall have first right of hire, regardless of age, in
his occupational specialty, by any other air car-
rier hiring additional employees which held a
certificate issued under section 1371 of [the
appendix to title 49] prior to October 24, 1978.
Each such air carrier hiring additional
employees shall have a duty to hire such a per-
son before they [sic] hire any other person,
except that such air carrier may recall any of its
own furloughed employees before hiring such a
person. Any employee who is furloughed or
otherwise terminated (other than for cause), and
who is hired by another air carrier under the
provisions of this subsection, shall retain his
rights of seniority and right of recall with the air
carrier that furloughed or terminated him.
49 U.S.C. app. § 1552(d).
In October 1981 Crocker was furloughed by Air New
England when that airline ceased operation. In April 1982
he applied for employment with Piedmont, a “certifi-
cated” carrier subject to the EPP’s first-hire duty, and in
July of that year Piedmont interviewed him. In December
1982, having heard nothing from Piedmont, Crocker took
a position as chief pilot for Coral Air, Inc., a noncertifi-
cated commuter airline then in Chapter 11 bankruptcy,
and soon afterward became its Director of Operations. In
July 1983, shortly before Coral Air’s assets were frozen
App. 57
and it haited operations, Crocker resigned his position
with that carrier.
In June 1986, Crocker filed this action alleging Pied-
mont violated section 43(d) by refusing to hire him, pur-
suant to his right of first hire, during the period
beginning in March 1984 when Piedmont hired other,
nonprotected pilots.2 On October 4, 1989, Piedmont
moved to strike certain portions of Crocker’s claim for
relief. By memorandum opinion and order filed Novem-
ber 15, 1989, the district court, treating the motion as one
for summary judgment, granted judgment in Piedmont’s
favor on the ground that Crocker ceased to be a covered
employee entitled to a hiring preference when he took
employment with Coral Air. Crocker then filed a motion
for reconsideration which was denied by memorandum
opinion and order filed February 8, 1990. Crocker now
appeals the district court’s decision.
IT.
It is undisputed for the purpose of this appeal that
Crocker is a protected employee under the EPP and that
he acquired a section 43(d) right of first hire in October
1981 when he was laid off by Air New England. Thus, the
sole issue before this court is whether Coral Air’s hiring
of Crocker in December 1982 extinguished his right of
first hire under the statute so as to relieve Piedmont of its
2 While this action was pending, Crocker obtained, and
resigned from, employment with two other non-certificated
airlines. He worked for Eastern Metro Express from July 1986
until November 1986 and for Eastern Express from January
1987 until March 1987.
App. 58
statutory obligation to afford Crocker a hiring preference
Over nonprotected applicants. We hold that it did not.
In its opinion granting Piedmont’s motion, the dis-
trict court concluded that Crocker’s employment with
Coral Air, a noncertificated carrier, extinguished his first-
hire right. Observing that the EPP expressly limits the
duration and amount of monthly assistance payments to
a displaced protected employee able to obtain new
employment by (1) reducing the amount of monthly pay-
ments to a protected employee who is offered but fails to
accept “reasonable comparable employment,” 49 U.S.C.
app. § 1552(b)(2), and (2) terminating payments alto-
gether after seventy-two months or when “the recipient
obtains other employment,” whichever occurs first, 49
U.S.C. app. § 1552(e)(1), the district court reasoned:
The fact that an employee was hired by a non-
covered carrier, if in a “reasonably comparable
position,” would get the employee off the assis-
tance to the extent that the salary was compara-
ble. It would be a strange result for the
government to burden private employers more
than itself by letting the government’s respon-
sibility end when the protected employees got
“reasonably comparable employment” but
require continued private air carrier preference
until the employee got a “covered carrier” posi-
tion.
Memorandum Opinion dated November 14, 1989 at 7-8
(footnote omitted). In its order denying reconsideration,
the court offered an additional rationale for its ruling:
“Plainitff secured a job in his occupational speciality,
“Ibeit without the help of the ADA. He was then no
longer ‘furloughed’ or ‘terminated’ and therefore he is
App. 59
ineligible for the first-hire preference under the terms of
the statute, the legislative intent, and the agency inter-
pretation.” Memorandum Opinion and Order dated Feb-
ruary 8, 1990. We reject the district court’s analysis for the
following reasons.
First, the EPP itself imposes no limits on the length of
a protected employee’s first-hire right and we do not
believe the statutory restrictions on financial! assistance
should be engrafted on the first-hire provisions?. In
reStricting the assistance payments, Congress acted to
“limit{] as much as possible the potential expenditure of
Government funds,” S.Rep. No. 95-631, 95th Cong. 2d
Sess. 115 (1978), and to ensure that it created no disincen-
tive to reemployment, see id. at 117 (“The committee
intends that the percentages chosen will result in com-
pensation payments that are less than the employees’
after-tax income in order to preserve maximum incen-
tives for employees to secure comparable work.”), quoted
in Alaska Airlines, 480 U.S. at 694, 107 S.Ct. at 1485. These
concerns do not support similarly limiting a pilot’s first-
hire right. The first-hire provisions impose no additional!
expense on the government and in fact were viewed by
Congress as a means of relieving the financial burden
created by the monthly assistance payments. See S.Rep.
No. 95-631, 95th Cong.2d Sess. 116 (1978) (“The interac-
tions of these provisions will decrease the cash payments
required under the program.”); 124 Cong.Rec. 10,76§5
3 In fact, given the express statutory restrictions on the
financial assistance benefits, the absence of any similar limita-
tions on the first-hire right suggests that Congress intended to
impose none.
App. 60
(1978) (Senator Zorinsky, seeking to amend the bill to
provide a hiring preference only “instead of affording the
relief of compensation from the pockets of the Nation’s
taxpayers”). Further, the prospect of losing those rights
upon employment by a noncertificated airline might dis-
courage a displaced employee from seeking interim
employment such as that taken by Crocker and prompt
him instead to wait for an opportunity to use the first-
hire right to obtain employment with an established,
formerly certificated airline. That result would frustrate
the legislative intent to encourage reemployment of dis-
placed protected employees and actually increase the
number of monthly payments, thereby exacerbating the
drain on the public fisc. For these reasons we reject the
district court’s conclusion that the financial assistance
restrictions should be applied to the first-hire right.4
Second, we do not agree with the district court’s
conclusion that a protected employee ceases to be “fur-
loughed or otherwise terminated,” so as to qualify for the
hiring preference, when he is hired by a noncertificated
airline. This rationale assumes that when the statute
speaks of an employee being “furloughed or otherwise
terminated,” it is referring to a status that an employee
acquires when terminated and later loses if hired by any
other employer. We think that under the more natural
4 In declining to apply those restrictions to the first-hire
provisions, we may be at variance with the Second Circuit's
recent decision in McDonald v. Piedmont Aviation, Inc., 930 F.2d
220 (2d Cir.1991), which relied on the financial assistance
restrictions to limit to seventy-two months the amount of back
pay recoverable by a protected employee who is denied his
first-hire right. Id. at 226-227.
App. 61
reading of the statutory language the contemplated ter-
mination or furlough should be viewed as a single act of
the employing carrier which triggers the first-hire right.
Third, we find the district court’s holding contrary to
the recently expressed position of the Department of
Labor (Department), the agency charged with promulgat-
ing regulations under section 43. When the district court
issued its decision, the Department had not espoused a
clear opinion on the question presented.° Since that time,
however, the Department has interpreted section 43(d) to
mean that a displaced protected employee retains his
first-hire right until hired by an air carrier that held a
certificate before deregulation and that the employee,
therefore, does not lose that right upon employment by a
noncertificated carrier such as Coral Air. See Brief for the
Acting Secretary of Labor as Amicus Curiae; Depart-
ment’s Letter to United Airlines, dated January 3, 1991.
Because Congress expressly charged the Department with
administering the EPP, its interpretation is entitled to
deference unless inconsistent with the statutory lan-
guage. See Robinson v. American Airlines, Inc., 908 F.2d
> The district court did have before it, and relied upon, an
opinion letter by the Department stating that a protected
employee lost his first hire right upon reemployment by a
certificated air carrier. See Department's Letter to USAir, Inc.,
dated June 2, 1989. The broad language used in that letter,
viewed in isolation, can be construed to support Piedmont’s
position here. See id. at 1 (“A designated employee who has
obtained another job in his or her occupational [sic] no longer
has any rehire rights. Once a designated employee obtains
another job, that employee would no longer be furloughed or
terminated.”).
App. 62
1020, 1023 (D.C.Cir. 1990). We find the Department's
interpretation consistent with both the language and
intent of the statute.
As noted above, the first-hire right, unlike the finan-
cial assistance entitlement, is not expressly limited by the
statutory language. Further, the benefit expressly pro-
vided under subsection 43(d) is the right of a long-term
“protected” employee of a certificated carrier to first hire
by another certificated carrier, at the least suggesting, as the
Department maintains, that Congress intended to ensure
that a displaced protected employee obtain employment
not merely with any air line but with one comparable to
his previous employer, namely an established carrier that
held a certificate before regulation, and that the first-hire
right therefore survive until the employee obtains such
employment.
Nevertheless, Piedmont, responding to the Depart-
ment’s position, now offers in its post-argument brief a
new interpretation of section 43(d) to support its position
that Crocker lost his first-hire right when Coral Air hired
him. Piedmont first points out that the statute uses differ-
ent language to describe a carrier that triggers an
employee’s first-hire right by terminating him and a car-
rier that is subject to the first-hire duty: the former being
one “which is subject to regulation by the Civil Aeronau-
tics Board” and the latter being one “which held a certifi-
cate issued under section 1371 of [the appendix to title 49]
prior to October 24, 1978.” Piedmont next reasons that
this difference was purposeful and that Congress
intended thereby that a protected employee should
acquire the first-hire right when terminated by any carrier
subject to regulation by the Civil Aeronautics Board (CAB),
App. 63
whether or not formerly certificated or otherwise regu-
lated. Piedmont further asserts that this intent would be
unnecessary unless Congress contemplated that a pro-
tected employee also lose his first-hire right upon hiring
by any carrier subject to CAB regulation, whether or not
certificated. Otherwise, Piedmont contends, there would
be no need to confer the right upon termination by the
regulated but noncertificated carrier because the
employee would already possess the right, having
acquired it when terminated by the certificated carrier by
which he was employed on October 24, 1978. We find
Piedmont’s latest argument unpersuasive for the follow-
ing reasons.
First, Piedmont’s construction seems inconsistent
with Congress’s intent that the EPP benefit long-term
employees of certificated carriers who relied on the secu-
rity of their employment with those carriers and who lost
that employment as a result of deregulation, see Alaska
Airlines, 480 U.S. at 680-81, 107 S.Ct. at 1477-78; cf. 49
U.S.C. app. § 1552(a), (h)(2) (permitting monthly financial
assistance payments only to individuals adversely
affected by “a bankruptcy or major contraction of an air
carrier holding a certificate”), because it would confer the
right of first hire on a protected employee when termi-
nated by any carrier, whether or not the employee has
been involuntarily terminated by the certificated carrier
by which he was employed on October 24, 1978. Thus,
under Piedmont’s interpretation, a protected employee
who resigned employment with his long-term, certifi-
cated employer, or was discharged for cause, would
acquire the first-hire right if terminated or furloughed by
a subsequent, noncertificated employer.
App. 64
Second, had Congress intended that the right of first
hire be lost upon hiring by any carrier subject to regula-
tion, it could easily and clearly have expressed that intent
in the statutory language. There was no need or reason
for Congress instead to have left so significant a provi-
sion to be inferred through the subtle and complex logic
now offered by Piedmont, and we do not believe it did
SO.
The apparently inconsistent descriptions of the two
classes of carriers can more simply and fairly be ascribed
to imprecision of language than to any conscious intent to
distinguish between them. In referring to carriers “sub-
ject to regulation by the Civil Aeronautics Board,” Con-
gress may well have meant only those carriers formerly
holding a certificate, which were, after all, the only car-
riers subjected to actual regulation by the CAB.® Such a
meaning is supported by the preceding phrase “protected
employee of an air carrier” which at the least suggests
that the employee is protected by virtue of his employ-
ment with the subject carrier; that being the case, the
terminating carrier would, given the statutory definition
of “protected employee,” of necessity be one which held
a certificate of convenience and necessity on October 24,
1978. That meaning is also the one adopted by the
6 The Senate report on the EPP similarly refers to a certifi-
cated carrier as a “regulated carrier.” S. Rep. No. 95-631, 95th
Cong. 2d Sess. at 116-(“each regulated carrier is required to
give priority hiring to displaced employees who satisfy the
eligibility requirement”).
App. 65
Department in its regulations. See 29 C.F.R. § 220.10,
220.01(e) (granting first-hire right to “a protected
employee who is voluntarily placed on furlough or is
terminated by a covered air carrier” and defining “cov-
ered air carrier” as “an air carrier which was certificated
prior to October 24, 1978”).
For the preceding reasons, we conclude that Pied-
mont’s construction of section 43(d), while perhaps per-
missible, is not the only or even the more plausible
interpretation, given the circuitous route required to
reach it and the purpose of the EPP. Moreover, because
the Department’s construction is a reasonable one consis-
tent with the EPP’s language and purpose, we are
required to adopt that interpretation and to hold that
Crocker did not lost his statutory first-hire right when he
was hired by Coral Air. Accordingly, the judgment of the
district court is
Reversed and Remanded.
App. 66
APPENDIX 9
The Airline Deregulation Act of 1978.
Pub. Law 95-504 (S.2493); October 24, 1978. Section
102(a)(1) and (2) and Section 43 (49 USC §§ 1302(a)(1) &
(2) and Section 1552)
49 USC § 1302
§ 1302 Consideration of matters in public interest by
Board
(a) Factors for interstate, overseas, and foreign air trans-
portation. In the exercise and performance of its powers
and duties under this Act, the board shall consider the
following, among other things, as being in the public
interest, and in accordance with the public convenience
and necessity:
(1) The assignment and maintenance of safety as the
highest priority in air commerce, and prior to the authori-
zation of new air transportation services, full evaluation
of the recommendations of the Secretary of Transporta-
tio:, on the safety implications of such new services and
full evaluation of any report or recommendation submit-
ted under section 107 of this Act [49 USCS Appx § 1307].
(2) The prevention of any deterioration in establised
safety procedures, recognizing the clear intent, encour-
agement, and dedication of the Congress to the fur-
therance of the highest degree of safety in air
transportation and air commerce, and the maintenance of
the safety vigilance that has evolved within air transpor-
tation and air commerce and has come to be expected by
the traveling and shipping public.
App. 67
49 USC § 1552
§ 1552. Employee protection program
(a) General Rule. (1) The Secretary of Labor shall, sub-
ject to such amounts as are provided in appropriation
Acts, make monthly assistance payments, or reimburse-
ment payments, in amounts computed according to the
provisions of this section, to each individual who the
Secretary finds, upon application, to be an eligible pro-
tected employee. An eligible protected employee shall be
a protected employee who on account of a qualifying
dislocation (A) has been deprived of employment, or (B)
has been adversely affected with respect to his compensa-
tion.
(2) No employee who is terminated for cause shall receive
any assistance under this section.
(b) Monthly assistance computation. (1) An eligible
protected employee shall, subject to such amounts as are
provided in appropriation Acts, receive a monthly assis-
tance payment, for each month in which he is eligible
protected employee, in an amount computed by the Sec-
retary. The Secretary, after consultation with the Secretary
of Transportation, shall, by rule, promulgate guidelines to
be used by him in determining the amount of each
monthly assistance payment to be made to a member of
each craft and class of protected employees, and what
percentage of salary such payment shall constitute for
each applicable class or craft of employees. In computing
App. 68
such amounts for any individual protected employee, the
Secretary shall deduct from such amounts the full amount
of any unemployment compensation received by the pro-
tected employee.
(2) If any eligible protected employee is offered reasona-
bly comparable employment and such employee does not
accept such employment, then such employee’s monthly
assistance payment under this section shall be reduced to
an amount which such employee would have beeen
[been] entitled to receive if such employee had accepted
such employment. If the acceptance of such comparable
employment would require relocation, such employee
may elect not to relocate and, in lieu of all other benefits
provided herein, to receive the monthly assistance pay-
ments to which he would be entitled if this paragraph
were not in effect, except that the total number of such
payments shall be the lesser of three or the number
remaining pursuant to the maximum provided in subsec-
tion (e).
(c) Assistance for relocation. If an eligible protected
employee relocates in order to obtain other employment,
such employee shall, subject to such amounts as are pro-
vided in appropriation Acts, receive reasonable moving
expenses (as determined by the Secretary) for himself and
his immediate family. In addition, such employee shall,
subject to such amounts as are providea in appropriation
Acts, receive reimbursement payments for any loss
resulting from selling his principal place of residence at a
price below its fair market value (as determined by the
Secretary) or any loss incurred in cancelling such
employee’s lease agreement or contract of purchase
relating to his principal place of residence.
App. 69
(d) Duty to hire protected employees. (1) Each person
who is a protected employee of an air carrier which is
subject to regulation by the Civil Aeronautics Board who
is furloughed or otherwise terminated by such an air
carrier (other than for cause) prior to the last day of the
10-year period beginning on the date of enactment of this
section [enacted Oct. 24, 1978] shall have first right of
hire, regardless of age, in his occupational specialty, by
any other air carrier hiring additional employees which
held a certificate issued under section 401 of the Federal
Aviation Act of 1958 [49 USCS Appx. § 1371] prior to such
date of enactment. Each such air carrier hiring additional
employees shall have a duty to hire such a person before
they hire any other person, except that such air carrier
may recall any of its own furloughed employees before
hiring such a person. Any employee who is furloughed or
otherwise terminated (other than for cause), and who is
hired by another air carrier under the provisions of this
subsection, shall retain his rights of seniority and right of
recall with the air carrier that furloughed or terminated
him.
(2) The Secretary shall establish, maintain, and peri-
odically publish a comprehensive list of jobs available
with air carriers certificated under section 401 of the
Federal Aviation Act of 1958 [49 USCS Appx. § 1371].
Such list shall include that information and detail, such as
job descriptions and required skills, the Secretary deems
relevant and necessary. In addition to publishing the list,
the Secretary shall make every effort to assist an eligible
protected employee in finding other employment. Any
App. 70
individual receiving monthly assistance payments, mov-
ing expenses, or reimbursement payments under this sec-
tion shall, as a condition to receiving such expenses or
payments, cooperate fully with the Secretary in seeking
other employment. In order to carry out his respon-
sibilities under this subsection, the Secretary may require
each such air carrier to file with the Secretary the reports,
data, and other information necessary to fulfull [sic] his
duties under this subsection.
(3) In addition to making monthly assistance or reimbur-
sement payments under this section, the Secretary shall
encourage negotiations between air carriers and repre-
sentatives of eligible protected employees with respect to
rehiring practices and seniority.
(e) Period of monthly assistance payments. (1)
Monthly assistance payments computed under subsection
(b) for a protected employee who has been deprived of
employment shall be made each month until the recipient
obtains other employment, or until the end of the 72
months occurring immediately after the month such pay-
ments were first made to such recipient, whichever first
occurs.
(2) Monthly assistance payments computed under subsec-
tion (b) for a protected employee who has been adversely
affected relating to his compensation shall be paid for no
longer than 72 months; so long as the total number of
monthly assistance payments made under this section for
any reason do not exceed 72.
(f) Rules and regulations. (1) The Secretary may issue,
amend, and repeal such rules and regulations as may be
necessary for the administration of this section.
App. 71
(2) The rule containing the guidelines which is required
to be promulgated pursuant to subsection (b) of this
section and any other rules or regulations which the
Secretary deems necessary to carry out this section shall
be promulgated within six months after the date of enact-
ment of this section [enacted Oct. 24, 1978].
(3) The Secretary shall not issue any rule or regulation as
a final rule or regulation under this section until 30
legislative days after it has been submitted to the Com-
mittee on Commerce, Science, and Transportation of the
Senate and the Committee on Public Works and Transpor-
tation of the House of Representatives. Any rule or regu-
lation issued by the Secretary under this section as a final
rule or regulation shall be submitted to the Congress and
shall become effective 60 legislative days after the date of
such submission, unless during that 60-day period either
House adopts a resolution stating that that House disap-
proves such rules or regulations, except that such rules or
regulations may become effective on the date, during
such 60-day period, that a resolution has been adopted by
both Houses stating that the Congress approves of them.
(4) For purposes of this subsection, the term “legislative
day” means a calendar day on which both Houses of
Congress are in session.
(g) Airline employees protective account. All payments
under this section shall be made by the Secretary from a
separate account maintained in the Treasury of the
United States to be known as the Airline Employees
Protective Account. There are authorized to be appropri-
ated to such account annually, beginning with the fiscal
App. 72
year ending September 30, 1979, such sums as are neces-
sary to carry out the purposes of this section, including
amounts necessary for the administrative expenses of the
Secretary related to carrying out the provisions of this
section.
(h) Definitions. For the purposes of this section -
(1) The term “protected employee” means a person who,
on the date of enactment of this section [enacted Oct. 24,
1978], has been employed for at least 4 years by an air
carrier holding a certificate issued under section 401 of
the Federal Aviation Act of 1958 [49 USCS Appx. § 1371].
Such term shall not include any members of the board of
directors or officers of a corporation.
(2) The term “qualifying dislocation” means a bankruptcy
or major contraction of an air carrier holding a certificate
under section 401 of the Federal Aviation Act of 1958 [49
USCS Appx. § 1371], occurring during the first 10 com-
plete calendar years occurring after the date of enactment
of the Airline Deregulation Act of 1978 [enacted Oct. 24,
1978], the major cause of which is the change in regula-
tory structure provided by the Airline Deregulation Act
of 1978, as determined by the Civil Aeronautics Board.
(3) The term “Secretary” means the Secretary of Labor.
(4) The term “major contraction” means a reduction by at
least 7'/2 percent of the total number of full-time
employees of an air carrier within a 12-month period.
Any particular reduction of less than 7'/2 percent maybe
found by the Board to be part of a major contraction of an
air carrier if the Board determines that other reductions
are likely to occur such that within a 12-month period in
, App. 73
which such particular reduction occurs the total reduc-
tion will exceed 7'/2 percent. In computing a 7'/2 percent
reduction under this paragraph, the Board shall not
include employees who are deprived of employment
because of a strike or who are terminated for cause.
(i) Transfer of authority of Board. The authority of the
Board under this section is transferred to the Department
of Transportation on January 1, 1985.
(j) Termination. The provisions of this section shall ter-
minate on the last day the Secretary is required to make a
payment under this section. (Oct. 24, 1978, P.L. 95-504
§ 43, 92 Stat. 1750.)
App. 74
APPENDIX 10
AFFIDAVIT OF JOHN J. NANCE, submitted with
McDonald’s Petition to Rehear, in McDonald v. Piedmont
Aviation, Inc., (Civ. Ap. 90-7328) to the Court of Appeals
for the Second Circuit.
AFFIDAVIT
SUBMITTED BY PERMISSION OF THE COURT
BY ORDER OF JUDGE ALTIMARI OF 7 MAY 1991,
State of Washington §
§
County of Pierce §
The undersigned JOHN J. NANCE, being duly
sworn, and under the penalties of perjury, hereby attests
to the following.
In passing the Airline Deregulation Act of 1978, the
Congress clearly and unequivocally stated their firm inten-
tion that the safety of airline transportation not be lessened
or compromised as a result of the pivotal changes and free
market forces the Act was expected to unleash on the airline
industry.' Indeed, the first two paragraphs of Section 102
clearly established this legislative intention when it directed
that in the exercise and performance of its powers, the Civil
Aeronautics Board “shall consider the following, among
other things, as being in the public interest... ”:
' The Short Title of the Act was “The Airline Deregulation
Act of 1978”, Pub.Law 95-504 [S.2493]; October 24, 1978.
App. 75
“(1) The assignment and maintenance of safety
as the highest priority in air commerce, and
prior to the authorization of new transportation
services, full evaluation of the recommendations
of the Secretary of Transportation on the safety
implications of such new services and full eval-
uation of any report of recommendation submit-
ted under section 107 of this Act,
(2) The prevention of any deterioration in
established safety procedures, recognizing the
clear intent, encouragement, and dedication of
the Congress to the furtherance of the highest
degree of safety in air transportation and air
commerce, and the maintenance of the safety
vigilance that has evolved within air transporta-
tion and air commerce and has come to be
expected by the traveling and shipping public,”
While the primary agent of safety assurance for the
air transportation system of the United States was to
remain the Federal Aviation Administration and the bod
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