Amicus Curiae Brief — El Al Israel Airlines, Ltd. v. Tsui Yuan Tseng

—

MOTION FILED

mn 16 1998

No. 97-475

IN THE

Supreme Court of the United States

OCTOBER TERM, 1997

EL AL ISRAEL AIRLINES, LTD.,

Petitioner,

— ean

TSUI YUAN TSENG,

Respondent.

On Writ Of Certiorari to the United States

Court Of Appeals for the Second Circuit

MOTION FOR LEAVE TO FILE BRIEF AMICUS CURIAE

AND BRIEF AMICUS CURIAE OF

THE INTERNATIONAL AIR TRANSPORT ASSOCIATION

IN SUPPORT OF PETITIONER

BERT W. REIN

Counsel of Record

EDWIN O. BAILEY

WILEY, REIN & FIELDING

1776 K Street, N.W.

Washington, D.C. 20006

(202) 429-7000

Attorneys for Amicus Curiae

July 16, 1998

No. 97-475

IN THE

Supreme Court of the Anited States

OCTOBER TERM, 1997

EL AL ISRAEL AIRLINES, LTD.,

Petitioner,

eaten

Tsu! YUAN TSENG,

Respondent.

On Writ Of Certiorari To The United States

Court Of Appeals For The Second Circuit

MOTION FOR LEAVE TO FILE

BRIEF AMICUS CURIAE

The International Air Transport Association (IATA)

respectfully moves for leave to file the attached Brief as

amicus curiae in this case. The consent of counsel for the

petitioner was obtained. The consent of counsel for

respondent was requested and refused. This Court

previously granted IATA’s motion for leave to file a Brief as

amicus curiae in Support of the Petition for Writ of

Certiorari. 1998 U.S. LEXIS 3398 (May 18, 1998).

IATA’s interest in this case derives from its efforts on

behalf of its 256 member air carriers to preserve the Warsaw

Convention' as the uniform determinant of international air

carrier liability to passengers while voluntarily modernizing

and liberalizing its application. Voluntary initiatives led by

IATA are ongoing and strongly supported by the United

States Department of Transportation and other governmental

authorities.

The Court’s decision on the issue presented will have a

significant impact on these efforts. As set forth more fully in

the Brief attached to this motion, it is of national and

international importance that this Court’s decision take

cognizance of these developments.

Respectfully submitted,

BERT W. REIN

Counsel of Record

EDWIN O. BAILEY

WILEY, REIN & FIELDING

1776 K Street, N.W.

Washington, D.C. 20006

(202) 429-7000

Attorneys for Amicus Curiae

Dated: July 16, 1998

Convention for the Unification of Certain Rules Relating to

International Transportation by Air, concluded at Warsaw, Poland, October 12,

1929, 49 Stat. 3000, T.S. No. 876, 137 L.N.T.S. 11 (1934), reprinted in 49

U.S.C. § 40105 (1997) (note).

i

TABLE OF CONTENTS

Page

INTEREST OF AMICUS CURIAE. ......00c0ccccccceeeeeeeees 2

INTRODUCTION AND SUMMARY OF

TT iaitailinctartnapeenntinnagmpenianencmnseteeesessocenes 3

TT TE A 6

I. ARTICLE 17 OF THE WARSAW

CONVENTION PROVIDES THE

EXCLUSIVE REMEDY FOR AIRLINE

PASSENGERS INJURED IN

“INTERNATIONAL TRANSPORTATION”

AS DEFINED BY ARTICLE 1(2) OF THE

A. The Court Below Improperly Engaged In

Judicial Activism In Attempting to Find a

Set of “Ordinary Torts” Outside The

2. In Denying Article 17 Full Preemptive

Effect, The Court Ignored The Necessary

Consequences Of Federal Preemj.ion

Analysis As Determined In The Fifth

Circuit’s Potter Decision ................-.--.+-+ 10

B. The Second Circuit’s Position Cannot Be

Reconciled With The Shared Expectations

Of The Parties To The Convention................ 12

il

Il. THIS COURT SHOULD REAFFIRM THE

UNITED STATES’ COMMITMENT TO A

UNIFORM, GLOBAL PASSENGER

~ COMPENSATORY LIABILITY REGIME.........

A. The Air Carriers’ Current Initiative To

Modernize And Liberalize The Warsaw

Convention’s Worldwide Article 17

Is Ongoing And Had Had The Strong

Support Of The U.S. Department of

B. The Air Carriers’ Efforts To Modernize The

Warsaw Convention Passenger Liability

Regime Worldwide Would Be Seriously

Impaired If the Convention Is Not Read To

Provide The Exclusive Remedy For

Personal Injuries In “International

EE cheeentitagttinitetarteccmatecen

Ge a ecrcnirccnsesctnercinlapitiniiledunsiaiinicidenibauiiaaess

TABLE OF AUTHORITIES

Cases Page

Abnett v. British Airways pic, | All E.R. 193 (H.L.

iii iantsciatenennestninchabdeitibtnisnabesiindsisinaibiaiainipindatidnsitinete passim

Air France v. Saks, 470 U.S. 392 (1985) ..........0c0008 passim

Dooley v. Korean Air Lines Co., Lid, 118 S. Ct.

I sietciethitihcalansiihteleemscitieahaliainiiepatainmmmencaqnene 13

Eastern Airlines, Inc. v. Floyd, 499 U.S. 530

I cvitocinidenp tsceniinssthiciinvtiabtitbndnddeiitiaimauitiiendeneincctiasn passim

Potter v. Delta Air Lines, Inc., 98 F.3d 881 (Sth Cir.

STE cccsoricittntninapthbibanieitipsieimaninctndumienitiganactinenié 5,10,11

Zicherman v. Korean Air Lines Co., Lid, 516 U.S.

BO ED Adnereipitientstiatibdiesihiinecrinlapicienninbiebtanienini 7,14

STATUTES

ee witecirenninttlitciterrncenearnignepincsinig 15

es ucintntciinninenncnensnhsisiniaiprictipbmntaisenaine 15

Convention for the Unification of Certain Rules

Relating to International Transportation by Air,

concluded at Warsaw, Poland, October 12, 1929,

49 Stat. 3000, T.S. No. 876, 137 L.N.T.S. 11

(1934), reprinted in 49 U.S.C. § 40105 (1997) ..... 2,14

MISCELLANEOUS

Council Regulation (EC), No. 2027/97 (Oct. 9,

International Air Transport Association:

Agreement Relating to Liability Limitations of

The Warsaw Convention, Order 96-10-7, 1996

WL 563872 (Dep’t of Transp. Oct. 3, 1996)......... 17

iv

International Air Transport Association:

Agreement Relating to Liability Limitations of

The Warsaw Convention, Order 97-1-2, 1997

WL 4834 (Dep't of Transp. Jan. 8, 1997) ............. 18

Order on Discussion Authority Regarding Limits

and Conditions of Passenger Liability

Established by the Warsaw Convention, 60 Fed.

Reg. 12813 (Dep’t of Transp. 1995) ..................... 15,20

Internationa! Civil Aviation Organization

RE 4

International Civil Aviation Organization

EPOCURE FEET O ID cnccccscesssesintecescsssancessecsece 4

Letter from Waxman, Solicitor General, to Suter,

Clerk of the Supreme Court of the United States

RR eR eae TN HS 4

Report of the Meeting of the Special Group on the

Modernization and Consolidation of the

“Warsaw System” (SGMW), Montreal, April 14-

No. 97-475

IN THE

Supreme Court of the United States

OCTOBER TERM, 1997

EL AL ISRAEL AIRLINES, LTD.,

Petitioner,

—v-—

Tsu!l YUAN TSENG,

Respondent.

On Writ Of Certiorari to the United States

Court Of Appeals for the Second Circuit

BRIEF OF AMICUS CURIAE THE INTERNATIONAL

AIR TRANSPORT ASSOCIATION IN SUPPORT OF

PETITIONER

The International Air Transport Association ("IATA")

respectfully submits this brief as amicus curiae in support of

petitioner.’

' This brief was not authored in whole or in part by counsel for a party, and

no person or entity, other than the amicus curiae, its members, and its counsel,

made a monetary contribution to the preparation and submission of this brief.

2

INTEREST OF AMICUS CURIAE

IATA is an organization of some 256 air carriers,

including virtually all of the international air carriers, the

majority of which are either owned or controlled by

sovereign nations.’ Since its establishment in 1945 by

Special Act of the Canadian Parliament, IATA has worked

closely with governments and __intergovernmental

organizations to achieve and maintain uniformity in the

interpretation of international agreements affecting civil

aviation, including the Warsaw Convention.’ IATA has also

worked to assure that such agreements are responsive to

inevitable changes in technology, economics and

jurisprudence. These activities are consistent with IATA's

overriding purpose of promoting safe, regular and

economical air transportation for the benefit of all peoples of

the world.

Many of IATA’s member air carriers transport

passengers, baggage and goods to and from the United States

and, therefore, are subject to United States jurisdiction.

IATA is currently playing a major role in promoting

voluntary air carrier agreements that waive the Warsaw

Convention’s limitation of liability for international

passenger air transportation and restrict use of certain

defenses. These efforts have been approved by the U.S.

Department of Transportation (“DOT”) and many other

government authorities around the world. The Second

A complete list of LATA's member air carners is found in the Appendix to

its October 10, 1997 Brief Amicus Curiae in Support of Petitioner at the

certiorari Stage.

’ Convention for the Unification of Certain Rules Relating to International

Transportation by Air, concluded at Warsaw, Poland, October 12, 1929, 49 Stat.

3000, T.S. No. 876, 137 L.N.T.S. 11 (1934), reprinted in 49 U.S.C. § 40105

(1997) (note). The Articles cited herein are reproduced at Appendix A.

3

Circuit’s decision in Tseng v. EL AL Israel Airlines, Ltd,

122 F.3d 99 (2nd Cir. 1997), if sustained, could inhibit this

global effort by denying IATA member air carriers serving

the United States the benefit of the Convention’s

fundamental liability boundaries and uniform liability

regime. It would thus make IATA’s effort to encourage

additional air carriers to adopt liberalized and modernized

liability provisions substantially more difficult because

Carrier interest in voluntarily enhancing passenger rights

under the Convention is tied to the corresponding benefit of

preserving a properly bounded and uniform liability regime.

Accordingly, [ATA has a direct and substantial interest in

the case before the Court.

INTRODUCTION AND SUMMARY OF

ARGUMENT

This case comes before the Court at an extraordinary time

in the history of the Warsaw Convention liability regime.

Since 1995, more than 100 air carriers, including the vast

majority of the major international carriers, have agreed to

waive all monetary limitations on compensatory damages

permitted under the Convention and to absorb a substantial

amount of strict liability in Convention cases. The voluntary

agreements leading to these actions have been endorsed as a

“gigantic step” forward by the DOT, used as a standard for

European air carrier liability by the European Union‘ and

applauded by governments throughout the world. They may

indeed have broken the logjam which has heretofore

precluded governments from comprehensively updating the

* Council Regulation (EC) No. 2027/97 (Oct. 9, 1997), eff. Oct. 17, 1998

(extending regime of no limits and 100,000 Special Drawing Rights strict

liability to both domestic and international operations of European air carriers).

4

Convention’ and they have apparently persuaded the United

States Senate to move forward ratification of Montreal

Protocol No. 4 to the Convention, and thus reaffirm the

Convention’s occupation of the field of airline liability for

passenger injury in international air transportation. See

Letter from Waxman, Solicitor General, to Suter, Clerk of

the Supreme Court of the United States, July 1, 1998 at 2.

The Second Circuit’s decision in Tseng is both legally

erroneous and threatening to this positive movement. If

affirmed, it would create liability in the absence of both the

accident -- ie. “an unexpected or unusual event or

happening that is external to the passenger”, Air France v.

Saks, 470 U.S. 392, 405 (1985) (emphasis added) -- and the

physical injury prerequisites t+ recovery under Article 17,

Eastern Airlines v. Floyd, 499 U.S. 530, 535-36 (1991).

This liability would be unbounded by Convention rules and

administered under a variety of state laws. It would thus

depart radically from a treaty regime which, as this Court

previously has emphasized, is designed to promote certainty

and uniformity in the law governing air carrier liability in

international air transportation.

The consequences of such a departure would be extremely

unfortunate. The preservation of insurable boundaries and

* On November 26, 1997, the Council of the International Civil Aviation

Organization (“ICAO”) established a Special Group on the Modernization and

Consolidation of the “Warsaw System,” (SGMW). See ICAO Doc. C-

WP/10688. This Special Group is considering a draft revised Convention

prepared by the ICAO Legal Committee, ICAO Doc. 9693-LC/190, and is

currently reviewing the comments of Member States on the draft text in

contemplation of a Council decision on convening a Diplomatic Conference.

See Report of the Meeting of the Special Group on the Modernization and

Consolidation of the “Warsaw System” (SGMW), Montreal, Apri! 14-18, 1998,

(noting “a strong commitment towards the swift finalization of the new

instrument” to “seize this historic opportunity”).

5

uniform liability rules in international air transportation

under the Convention has been the carrot which has induced

many IATA members to voluntarily waive Article 22(1)

limits in Article 17 cases. Similarly, the facilitation of

settlement by uniform, predictable Convention rules has

encouraged carriers to accept a substantial measure of strict

liability as a further means of minimizing litigation costs.

The decision below, by contrast, would leave carriers

uncertain as to whether Convention rules would apply to any

particular claim since plaintiffs’ attorneys would certainly

plead non-Convention claims as alternatives or supplements

in virtually every case arising in international air

transportation. Moreover, litigation costs undoubtedly

would escalate as novel, non-Convention, claims were

adjudicated and settlement postponed.

The inevitable result would be a significant disincentive

to expansion of participation in beneficial intercarrier

agreements. In addition, the lure of litigating outside

Convention boundaries could stir opposition to United States

participation in continuing international negotiating efforts

to enhance the position of passengers under the treaty regime

while reaffirming its preemptive purpose and uniform

liability rules.

IATA believes that the wording, purpose and negotiating

history of the Warsaw Convention require reversal of the

decision below. The preclusive effect of Article 17

limitations was recently affirmed by the House of Lords for

exactly these reasons in Abnett v. British Airways plc, | All

E.R. 193 (H.L. 1996) and IATA encourages the Court to

give weight to this well-considered decision as well as the

Fifth Circuit’s analysis in Potter v. Delta Airlines, 93 F.3d

881 (Sth Cir. 1996) which reached the same conclusion.

Thus, both on legal and practical grounds, reversal of the

decision below is essential.

6

ARGUMENT

I. ARTICLE 17 OF THE WARSAW

CONVENTION PROVIDES THE EXCLUSIVE

REMEDY FOR AIRLINE PASSENGERS

INJURED IN “INTERNATIONAL

TRANSPORTATION” AS DEFINED BY

ARTICLE 1(2) OF THE CONVENTION.

Petitioner and the Solicitor General will address in detail

the errors in the Second Circuit’s reasoning and analysis

which led it to deny preemptive effect to the Convention’s

liability regime. However, there are several points of special

interest to the international airline community that IATA

wishes to emphasize.

A. The Court Below Improperly Engaged In

Judicial Activism In Attempting to Find a

Set of “Ordinary Torts” Outside The

Convention.

To reach its ultimate conclusion denying full preemptive

effect to the Convention’s liability regime, the Second

Circuit chose to ignore this Court’s admonitions on how the

Convention is to be interpreted, and adopted a narrow

approach based more on assertion than reason. It also

cramped the preemptive effect of the treaty, which is the

supreme law of the land, without engaging in any of the

traditional federal preemption analysis required by this

Court’s precedents.

:

1. The Second Circuit Failed To

Follow This Court’s Guidance In

Interpreting The Convention.

In Saks, Floyd, and Zicherman v. Korean Air Lines, 516

U.S. 217 (1996), this Court set out clear guidelines to be

applied when interpreting the Convention.

First, the French text should be consulted to guide the

analysis “because it is our responsibility to give the specific

words of the treaty a meaning consistent with the shared

expectations of the contracting parties . . . [and] because the

Warsaw Convention was drafted in French by continental

jurists.” Saks, 470 U.S. at 399. The French version is also

“the only authentic text” of the Convention. Floyd, 499 U.S.

at 535.

Second, isolated comments of delegates reported in the

minutes of the 1929 Warsaw Conference are not

determinative of the meaning of Convention Articles

because these “remark{s] [do] not have the authority of

submissions by the drafting committee,” and may be nothing

more than generalizations that do not “focus[]} specifically”

on the interpretive issue under consideration. Zicherman,

516 U.S. at 227.

Third, with particular reference to the scope of air carrier

liability and Article 17, interpretations that best “accord[]

with the Warsaw Convention’s stated purpose of achieving

uniformity of rules governing claims arising from

international air transportation” are preferred. Fleya, 499

U.S. at 552. In general, “treaties are construed more

liberally than private agreements, and to ascertain their

meaning we may look beyond the written words to the

history of the treaty, the negotiations, and the practical

construction adopted by the parties.” Saks, 470 U.S. at 396

(internal citation omitted).

8

The Second Circuit ignored each of these interpretive

principles. First, it looked only at the English text of Article

24(2) in concluding that the Convention was exclusive only

where presumptive liability arose under Article 17. Tseng,

122 F.3d at 104-105. The Solicitor General’s Brief in

Support of Petition for Writ of Certiorari establishes that the

French text’s “[djams les cas prévus a l’article 17”

encompasses all claims “in the circumstances anticipated [or

‘foreseen’] in Article 17” i.e., where a passenger seeks relief

for injuries sustained between embarkation and

disembarkation. See Solicitor General’s Brief in Support of

Petition for Writ of Certiorari at 14-15. The term “les cas

prévus” “serves as a shorthand for personal injury cases in

general -- which Article 17 addresses (or ‘anticipates’)

comprehensively -- and distinguishes that class of cases from

cases involving damaged or lost luggage and delay, to which

Article 24(1) refers with the parallel phrase ‘les cas prévus

aux articles 18 et 19°.” Jd. The Second Circuit’s English-

only analysis, by ignoring the more expansive meaning of

the Convention’s French text, fails to “give the specific

words of the treaty a meaning consistent with the shared

expectations of the contracting parties.” Saks, 470 U.S. 399.

Second, to bolster its English language reading of Article

24(2), the Second Circuit relies on vague, non-specific

remarks by individual delegates or delegations in the English

translation of the minutes of the 1929 Warsaw Conference.

Tseng, 122 F.3d at 105. However, the statements it cites do

not specifically address the question at issue. Rather, the

referenced remarks merely suggest that the delegates were

aware that the Convention would not deal with all issues

affecting international commercial aviation and that a

number of undefined subjects which are not addressed by the

Convention would, per force, be left to domestic laws of the

various signatory nations for resolution. Lord Hope of

9

Craighead, speaking for the House of Lords in Abnett,

looked at these same minutes and found nothing in them to

support the argument against giving less than full preemptive

effect to Article 17’s liability boundaries:

But these are mere straws in the wind which

emerged during several days of detailed

discussion to which many delegates

contributed. I do not find a sufficiently clear

and consistent expression of views here about

the objects of the Convention on the point

which is at issue in this case to enable me to

say that the answer to the problem is to be

found in the minutes. The most that can be

said is that I have not found anything in these

minutes or in the accompanying material

which contradicts the impression which I

have already formed on reading the

convention.

Abnett, 1 All E.R. at 208.

Third, the Second Circuit ignores this Court’s strong

admonition that the Convention should be construed

consistently with the “shared expectations of the contracting

parties,” including most specifically, the desire to achieve

uniformity in the laws governing international transportation

by air. Saks, 470 U.S. 399. Its newly-minted “ordinary”

injury concept covering injuries within the international air

transportation scope of Article 17 — which it then illustrates

with the example of a malfunctioning escalator causing

injury outside the scope of Articles 17 and 24(2) -- would

result in passengers claiming injury from the same incident

on the same flight being treated differently if, for example,

one claimed physical injury and one claimed non-physical

injury for which relief is barred under Article 17. See Floyd,

10

499 U.S. at 552. No principle of uniformity could survive

this concept whose practical result would be to ensure a mix

of covered, Convention law, and “ordinary”, state-law,

claims in virtually every injury case.

2. In Denying Article 17 Full Preemptive

Effect, The Court Ignored The Necessary

Consequences Of Federal Preemption

Analysis As Determined In The Fifth

Circuit’s Potter Decision.

It is undisputed that respondent’s alleged harm occurred

during embarkation in international travel by air and thus

“inside” the substantive scope of the Warsaw Convention as

defined by Articles 1 and 17. Nevertheless, the Second

Circuit declares that respondent’s remedy lies “outside” the

Convention because she could not meet Article 17's

requirements for establishing presumptive liability. Tseng,

122 F.3d at 104-05. The decision thus circumvented all of

the Convention’s conditions and limitations which establish

uniform procedural, jurisdictional and substantive law for

passenger liability.

In reaching this result, the Second Circuit failed to apply

this Court’s precedents on federal preemption. It also

summarily rejected the Fifth Circuit’s decision in Potter v.

Delta Air Lines, 98 F.3d 881 (Sth Cir. 1996) giving Article

17 full federal preemptive effect. Tseng, 122 F.3d at 107.

This telling omission strongly suggests that the court below

could find no flaw in the Potter court’s reasoning or in its

application of this Court’s prior federal preemption

decisions.

The Fifth Circuit’s reasoning in Potter is indeed

compelling. First, it properly followed this Court’s guidance

in Floyd and Saks by interpreting the Convention “in order

1]

to advance its [apparent] goals.” Potter, 98 F.3d at 885. To

ascertain these goals, it cited this Court’s findings in

Zicherman, concluding that “[a] primary function of the

Warsaw Convention is to foster uniformity in the laws

governing international air carrier liability.” /d

Second, applying this Court’s federal preemption criteria,

the Fifth Circuit inquired whether the “area” requiring

uniformity, that is, international passenger liability, would

be frustrated if state court actions could be brought within

the jurisdictional scope of Article 17 whenever the claimant

could not meet one or more of that Article's requirements for

establishing liability. /d The court then undertook a

detailed analysis to show how state-law actions would

nullify significant Convention conditions and limitations,

that this Court’s previous decisions on the scope of

allowable Article 17 recoveries would be circumvented, and

that plaintiffs could “plead artfully” around Article 17 in

order to “forum-shop” in U.S. courts. /d. at 885-86.

Ignoring the Fifth Circuit's compelling analysis, the

Second Circuit attempted to dismiss Potter by contending (i)

that the Convention’s goal of uniformity “has not always

been found feasible in all areas of international travel,” (ii)

even where possible, uniformity cannot justify altering the

operating structure of the Convention, citing Zicherman, and

(iii) uniformity could be achieved equally as well by

allowing recovery outside the Convention, “under a uniform

body of law.” Tseng, 122 F.3d at 107. The first point, even

if true in the abstract, does not diminish the need to preserve

uniformity where it is feasible. See Abnett, | All E.R. at

212. The second point is valid only if the court’s misreading

of Article 24 is assumed. As to the third point, the Potter

court explained that there is no “uniform body of law”

applicable to the state-law based cases that the Second

Circuit would allow. Potter, 98 F.3d at 886. To the

12

contrary, there are widely varying procedural and

substantive laws in the 50 states, all of which would

potentially be applicable. This is the antithesis of the

uniformity on passenger liability law and procedure sought

to be achieved by the signatories to the Convention.

B. The Second Circuit’s Position Cannot Be

Reconciled With The Shared Expectations

Of The Parties To The Convention.

This Court has stated that the “shared expectations of the

contracting parties” must be taken into account when

interpreting the Convention. Saks, 470 U.S. at 399. One

such unchallengeable expectation is uniformity of the law

applicable to passenger liability. Floyd, 499 U.S. at 532.

The Second Circuit acknowledges this as a goal of the

parties to the Convention, but nonetheless asserts that this

objective would be “absurd” or “illogical” if it meant that

claimants within the jurisdictional scope of Article 17, but

unable to satisfy its requirements for carrier liability, could

not step “outside” the Convention and ignore all its

conditions and limitations. Tseng, 122 F.3d at 106-07.

There is, however, no illogic to the parties’ contrary

shared expectation. Rather, it would be illogical to render

illusory the concept of uniformity by creating a parallel “opt-

- out” personal liability regime wholly reliant on the differing

domestic laws of the various nations around the world. In its

Abnett decision, the House of Lords made this point clearly

when it observed that the signatories did not “set{] alongside

the convention ... an entirely different set of rules which

would distort the operation of the whole scheme.” Abnett, |

All E.R. at 213.

Moreover, a treaty-based determination that air carriers

should not be exposed to liability, under a presumptive fault

13

regime, for non-corporal passenger injuries associated with

individual reactions to the experience of flight or the

processes involved with the embarking or disembarking of

such flights hardly seems “absurd”. /d. at 207.

Consistent with this expectation of limitations on carrier

responsibility for non-accidental or non-corporal injury, the

Convention requires that all passengers be given notice of

the applicability of the treaty with respect to the air carriers’

liability for damages. The notice provides passengers the

opportunity to obtain supplemental insurance or to take other

precautions before embarking on an international journey.

Article 23 also invalidates “[a]ny provision [in the contract

of carriage] tending to relieve the carrier of liability or to fix

a lower limit than that which is laid down in this convention

.... As the Solicitor General has pointed out, it would

have made no sense and would have been extremely one-

sided and odd to have restricted the air carriers’ right to limit

liability by contract if passengers were free to pursue

liability claims “within” Article 17 jurisdiction but “outside”

its express terms. See Solicitor General’s Brief in Support of

Petition for Writ of Certiorari at 18-19; see also, Dooley v.

Korean Air Lines Co., Ltd, 118 S.Ct. 1890 (1998) (where

Congress has struck a balance denying recovery for certain

claims and claimants under Death On The High Seas Act,

applicable under Article 17, Court cannot substitute its own

views).

The Second Circuit’s opinion would, therefore, render the

Convention’s goal of uniformity and its conditions and

limitations on passenger liability a nullity. This result

cannot be accepted as reflecting the “shared expectations” of

the Convention’s signatories, including the Government of

the United States.

14

II. THIS COURT SHOULD REAFFIRM THE

UNITED STATES’ COMMITMENT TO A

UNIFORM, GLOBAL PASSENGER

COMPENSATORY LIABILITY REGIME.

The Warsaw Convention is the most widely adhered to

private international law treaty. Some 120 nations are

parties to the agreement. The Convention is universally

recognized as a unique, remarkable achievement because of

its establishment of a uniform liability regime for

international transportation by air which provides certainty

and common legal expectations for air carriers, passengers,

and shippers throughout the world. Since its proclamation

by President Franklin Delano Roosevelt on October 29,

1934, the Convention has been the supreme law of the land.

See, 49 Stat. 3000 et seq.; cf, Zicherman, 516 U.S. at 226.

To preserve “uniformity in the law of international air

travel,” Zicherman, 516 U.S. at 350, against concerns that

certain of the Convention’s limits were unduly restrictive on

passengers, IATA and the world’s air carriers have, during

the past several decades, undertaken certain voluntary

initiatives to modernize and liberalize those rules. Thus, in

1966, the airlines entered into a multilateral agreement under

which they voluntarily raised the Article 22(1) limit of

liability for personal injury or death to $75,000 and waived

the non-negligence defense in Article 20(1) for claims up to

that amount, thus providing for virtual strict liability when

such damages had been demonstrated. More recently, when

it became apparent that governments were unable to succeed

in modernizing the liability regime through treaty

amendment, IATA and the world’s leading air carriers once

again liberalized the liability rules, this time waiving all

Article 22(1) liability limits for passengers worldwide, and

their Article 20(1) non-negligence defenses for U.S.-related

15

transportation up to 100,000 Special Drawing Rights, or

approximately $135,000.

These voluntary waivers, however, have depended, and

continue to depend, on the maintenance of a common,

uniform understanding that Article 17 bounds the claims that

can be brought. By reaffirming the need for global

uniformity on the law of passenger liability and rejecting the

Second Circuit’s contrary position, this Court can further the

airlines’ initiative to globalize these waivers to the benefit of

all international passengers.

A. The Air Carriers’ Current Initiative To

Modernize And Liberalize The Warsaw

Convention’s Worldwide Article 17

Passenger Compensatory Liability Regime

Is Ongoing And Had Had The Strong

Support Of The U.S. Department of

Transportation.

To comprehend fully the impact of the Second Circuit’s

decision, it is necessary for this Court to understand in some

detail the extensive efforts by IATA and the world’s air

carriers and the DOT in fashioning the most recent changes

to the Warsaw passenger liability regime.

The process began on February 22, 1995 when the DOT

granted IATA’s application for so-called “discussion

authority.” Order on Discussion Authority Regarding Limits

and Conditions of Passenger Liab. Est. by the Warsaw

Convention, 60 Fed. Reg. 12813 (Dep’t of Transp. 1995).

This authority, under 49 U.S.C. §§ 41308 and 41309,

granted antitrust immunity for the air carriers to discuss and

reach agreements on changing or even eliminating the

limitation of liability in Article 22(1) of the Convention and

waiving one or more of the defenses found in Articles 20(1)

16

and 21. Pursuant to this “discussion authority,”

representatives of the world’s air carriers held a series of

meetings in Washington which were monitored by the DOT

and the Department of Justice.

The first agreement to emanate from these sessions was

the “IATA Intercarrier Agreement on Passenger Liability.”

This agreement, which came to be known as the “IIA,” was

unanimously endorsed at the IATA Annual General Meeting

on October 31, 1995. It is an umbrella agreement pursuant

to which the air carriers agree, inter alia, “[t}o take action to

waive the limitation of liability on recoverable compensatory

damages in Article 22 paragraph 1 of the Warsaw

Convention as to claims for death, wounding or other bodily

injury of a passenger within the meaning of Article 17 of the

Convention ....” The IIA reserves all available

Convention defenses, but provides that any air carrier may

waive any defense, including the waiver of any defense up to

a specified monetary amount of recoverable compensatory

damages, as the circumstances may permit. Thus, by the fall

of 1995, many of the world’s air carriers had taken the first

step toward waiving any limitation of liability to compensate

for injuries cognizable under Article 17.

The next step was to reach agreement on measures to

implement the IIA in air carrier tariffs and conditions of

carriage. Further meetings of the air carriers were held

pursuant to DOT discussion authority. IATA carriers

evolved the “Agreement on Measures to Implement the

IATA Intercarrier Agreement” (“MIA”), under which

signatories agreed to tariff language waiving, inter alia, any

limitation of liability under Article 22(1) for all recoverable

compensatory damages arising under Article 17. Air carriers

* — The full text of the IIA is found at Appendix B.

17

also could use the MIA tariff language to waive Article

20(1) non-negligence defenses for portions of the claims that

did not exceed 100,000 Special Drawing Rights, or the

equivalent of approximately $135,000 at current exchange

rates.’ In other words, carriers, responding to the DOT,

could agree to virtual strict liability up to the latter amount

and waive any financial limitation on compensatory

damages.

U.S. air carriers, many of which are also IATA members,

developed a further agreement under the auspices of the Air

Transport Association of America (“ATA”). This

agreement, called the “ATA Provisions Implementing the

IATA Intercarrier Agreement to be Included in Conditions

of Carriage and Tariffs” (“IPA”), took the additional step of

permitting, subject to applicable law, recoverable Article 17

compensatory damages to be determined by reference to the

law of the domicile or permanent residence of the passenger.

The three air carrier agreements were submitted to the

DOT on July 31, 1996 for approval and antitrust immunity

under 49 U.S.C. §§ 41308 and 41309. On October 3, 1996,

the DOT issued a Show Cause Order tentatively approving

the agreements and recommending certain conditions.

International Air Transp. Assoc.: Agreement Relating to

Liab. Limitations of The Warsaw Convention, Order 96-10-

7, 1996 WL 563872 (Dep’t of Transp. Oct. 3, 1996). In its

Order, the DOT specifically found that “[w]ith their

provision for the worldwide waiver of the Warsaw passenger

liability limits, the agreements have made a gigantic step

toward creating an international liability regime under which

carriers properly accept liability for death or injuries of

passengers utilizing their service.” /d, 1996 WL 563872 at

” The full text of the MIA is found at Appendix C. =

18

*5. The agreements were given final DOT approval on

January 8, 1997. International Air Transp. Assoc.:

Agreement Relating to Liab. Limitations of The Warsaw

Convention, Order 97-1-2, 1997 WL 4834 (Dep’t of Transp.

Jan. 8, 1997).

B. The Air Carriers’ Efforts To Modernize

The Warsaw Convention Passenger

Liability Regime Worldwide Would Be

Seriously Impaired If the Convention Is

Not Read To Provide The Exclusive

Remedy For Personal Injuries In

“International Transportation.”

The extraordinary effort spearheaded by [ATA and the

world’s air carriers with the support of the U.S. DOT to

modernize and liberalize terms of the Warsaw Convention is

driven by the value air carriers place on global uniformity in

passenger liability. IATA has undertaken a worldwide

campaign, in cooperation with many member air carriers, to

persuade all international air carriers to sign the IIA and the

MIA. The agreements are currently being considered by air

carriers throughout the world. As of July 9, 1998, the IIA

had 107 signatories and the MIA had 67 signatories.*

Much work remains to be done to encourage true, global

acceptance of the new, liberalized regime. Until this task

has been completed, the full benefits -- the “gigantic step” to

which the DOT referred -- will not be available to

passengers on international flights throughout the world,

including the millions of United States citizens who travel

between foreign points having no contact with .nis country.

A list of the signatories is found at Appendix D.

19

For all such passengers, the Warsaw Convention -- hopefully

as modified by the IATA air carriers’ agreements -- will

provide their best protection.

IATA, and its air carrier members, undertook this effort to

modernize and liberalize the passenger liability provisions of

the Convention in the expectation that Article 17 would be

given the full preemptive effect that is reflected in the House

of Lords’ Abnett decision and in the Fifth Circuit’s Potter

decision. These decisions provide the certainty on the extent

of liability risks that is the guid pro quo for the air carriers’

willingness to waive liability limits under the Convention’s

presumptive fault regime and to take the additional step of

waiving Article 20(1) defenses up to 100,000 Special

Drawing Rights for United States-related traffic.

Throughout this modernization process, IATA and its air

carriers have been reinforced in these beliefs by the DOT’s

recognition that a uniform, global passenger liability regime

was in the best interest of all passengers, but most

particularly, United States passengers. Thus, at the

beginning of the process, in its Order granting “discussion

authority” on February 22, 1995, the DOT recognized that

the United States could not simply “order” foreign nations to

accord U.S. citizens the relief which it may believe is most

appropriate in the event of harm during international

transportation as defined by Article 1(2) of the Convention.

In discussing and rejecting alternatives to an air carrier

voluntary effort to liberalize and modernize the Warsaw

Convention, the DOT specifically observed:

A final alternative would be for the United

States to unilaterally establish a regime that

all carriers operating to the United States

would have to abide by. This approach,

however, could engender such significant

20 ;

opposition from our trading partners that our

ability to implement the plan unilaterally

would very well be jeopardized.

60 Fed: Reg. at 12813.

The DOT went on to note that:

IATA seeks discussions geared toward

producing a temporary § arrangement,

recognizing the immediate need to increase

the liability limits through a uniform system

of rules. This is fully consistent with our

objectives.

Id

Lastly, the DOT commented:

We have strived for a uniform international

system that allows U.S. victims to receive fair

recoveries within a reasonable period of time.

Id., at 12814.

The Second Circuit’s decision denying preemptive effect

to Article 17 places in jeopardy the guid pro quo on which

the voluntary carrier agreements have been undertaken. It

would be far more difficult, if not impossible, for IATA to

persuade other air carriers to join these agreements if the

U.S. commitment to a uniform liability regime is not

apparent. It might prove equally difficult to go forward to an

enhanced, uniform treaty regime if the state-law based

actions permitted by the decision below were approved by

this Court. Thus, the Second Circuit’s decision, if affirmed,

could greatly shorten the “gigantic step” that the DOT

believed the IATA air carrier agreements would achieve for

all passengers, and in particular, citizens of the United

States. IATA therefore respectfully submits that this Court

21

should follow the recommendation of the Solicitor General?

and reject the Second Circuit’s erroneous interpretation of

the Convention.

. In his Brief in Support of Petition for Writ of Certiorari at 12, the Solicitor

General notes that there are no issues presented here involving Article 25. That

Article, in the case of “willful misconduct” precludes air carrier resort to

“provisions of this convention which exclude or limit his liability.” Any

Suggestion that allegations of “willful misconduct” based on Article 25 also

permit claimants to avoid the requirements of Article 17, which deal with the

establishment of liability rather than its exclusion or limitation, would find no

Support in the language, structure or purpose of the Convention.

22

CONCLUSION

The judgment of the Second Circuit Court of Appeal

should be reversed.

Respectfully submitted,

BERT W. REIN

Counsel of Record

EDWIN O. BAILEY

WILEY, REIN & FIELDING

1776 K Street, N.W.

Washington, D.C. 20006

(202) 429-7000

Attorneys for Amicus Curiae

Dated: July 16, 1998

5

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APPENDIX A

Article 1(2)

(2) For the purpose of this convention the expression

“international transportation” shall mean any transportation

in which, according to the contract made by the parties, the

place of departure and the place of destination, whether or

not there be a break in the transportation or a transshipment, -

are situated either within the territories of two High

Contracting Parties, or within the territory of a single High

Contracting Party, if there is an agreed stopping place within

a territory subject to the sovereignty, suzerainty, mandate or

authority of another power, even though that power is not a

party to this convention. Transportation without such an

agreed stopping place between territories subject to the

sovereignty, suzerainty, mandate, or authority of the same

High Contracting Party shall not be deemed to be

international for the purposes of this convention.

Article 3(1)(e)

(1) For the transportation of passengers the carrier must

deliver a passenger ticket which shall contain the following

particulars:

(e) a statement that the transportation is subject

to the rules relating to liability established by this

convention.

2a

Article 17

The carrier shall be liable for damage sustained in the

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

bodily injury suffered by a passenger, if the accident which

caused the damage so sustained took place on board the

aircraft or in the course of any of the operations of

embarking or disembarking.

Article 20(1)

(1) The carrier shall not be liable if he proves that he and

his agents have taken all necessary measures to avoid the

damage or that it was impossible for him or them to take

such measures.

Article 22(1)

(1) In the transportation of passengers the liability of the

carrier for each passenger shall be limited to the sum of

125,000 francs [8300 Special Drawing Rights]. Where, in

accordance with the law of the court to which the case is

submitted, damages may be awarded in the form of

periodical payments, the equivalent capital value of the said

payments shall not exceed 125,000 francs. Nevertheless, by

special contract, the carrier and the passenger may agree to a

higher limit of liability.

Article 23

Any provision tending to relieve the carrier of liability or

to fix a lower limit than that which is laid down in this

convention shall be null and void, but the nullity of any such

provision shall not involve the nullity of the whole contract,

3a

which shall remain subject to the provisions of this

convention.

Articles 24(1) and 24(2)

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

for damages, however founded, can only be brought subject

to the conditions and limits set out in this convention.

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

the preceding paragraph shall also apply, without prejudice

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

to bring suit and what are their respective rights.

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APPENDIX B

IATA INTERCARRIER AGREEMENT ON

PASSENGER LIABILITY

WHEREAS, The Warsaw Convention system is of great

benefit to international air transportation; and

NOTING THAT: The Convention’s limits of liability,

which have not been amended since 1955, are now grossly

inadequate in most countries and that international airlines

have previously acted together to increase them to the

benefit of passengers;

The undersigned carriers agree

l. To take action to waive the limitation of liability on

recoverable compensatory damages in Article 22 paragraph

1 of the Warsaw Convention’ as to claims for death,

wounding or other bodily injury of a passenger within the

meaning of Article 17 of the Convention, so that recoverable

compensatory damages may be determined and awarded by

reference to the law of the domicile of the passenger.

2. To reserve all available defences pursuant to the

provisions of the Convention; nevertheless, any carrier may

waive any defence, including the waiver of any defence up

to a specified monetary amount of recoverable compensatory

damages, as circumstances may warrant.

l “WARSAW CONVENTION” as used herein means the Convention

for the Unification of Certain Rules Relating to International Carriage by Air

singed at Warsaw, 12th October 1929, or that Convention as amended at The

Hague, 28th September 1955, whichever may be applicable.

2b

3. To reserve their rights of recourse against any other

person, including rights of contribution or indemnity, with

respect to any sums paid by the carrier.

4. To encourage other airlines involved in the

international carriage of passengers to apply the terms of this

Agreement to such carriage.

5. To implement the provisions of this Agreement no

later than 1 November 1996 or upon receipt of requisite

government approvals, whichever is later.

6. That nothing in this Agreement shall affect the rights

of the passenger or the claimant otherwise available under

the Convention.

7. That this Agreement may be signed in any number of

counterparts, all of which shall constitute one Agreement.

Any carrier may become a party to this Agreement by

signing a counterpart hereof and depositing it with the

Director General of the International Air Transport

Association (LATA). .

8. That any carrier party hereto may withdraw from this

Agreement by giving twelve (12) months’ written notice of

withdrawal to the Director General of IATA and to the other

carriers parties to the Agreement.

Signed this day of 199

le

APPENDIX C

AGREEMENT ON MEASURES TO IMPLEMENT

THE IATA INTERCARRIER AGREEMENT

l.

I. Pursuant to the IATA Intercarrier Agreement of 31

October 1995, the undersigned carriers agree to

implement said Agreement by incorporating in their

conditions of carriage and tariffs, where necessary,

the following:

{CARRIER} shall not invoke the limitation

of liability in Article 22(1) of the Convention

as to any claim for recoverable compensatory

damages arising under Article 17 of the

Convention.

{CARRIER} shall not avail itself of any

defence under Article 20(1) of the

Convention with respect to that portion of

such claim which does not exceed 100,000

SDRs' [unless option II(2) is used].

Except as otherwise provided in paragraphs |

and 2 hereof, {CARRIER} reServes all

defences available under the Convention to

any such claim. With respect to third parties,

the carrier also reserves all rights of recourse

against any other person, including without

limitation, rights of contribution and

indemnity.

2c

Il. At the option of the carrier, its conditions of carriage

and tariffs also may include the following

provisions:

l.

{CARRIER} agrees that subject to applicable

law, recoverable compensatory damages for

such claims may be determined by reference

to the law of the domicile or permanent

residence of the passenger.

{CARRIER} shall not avail itself of any

defence under Article 20(1) of the

Convention with respect to that portion of

such claims which does not exceed 100,000

SDRs, except that such waiver is limited to

the amounts shown below for the routes

indicated, as may be authorised by

governments concerned with the

transportation involved.

{Amounts and routes to be inserted]

Neither the waiver of limits nor the waiver of

defences shall be applicable in respect of

claims made by public social insurance or

similar bodies however asserted. Such

claims shall be subject to the limit in Article

22(1) and to the defences under Article 20(1)

of the Convention. The carrier will

compensate the passenger or his dependents

for recoverable compensatory damages in

excess of payments received from any public

social insurance or similar body.

Bi Ps 2

Ill.

IV.

3¢

Furthermore, at the option of a carrier, additional

provisions may be included in its conditions of

carriage and tariffs, provided they are not

inconsistent with this Agreement and are in

accordance with applicable law.

Should any provision of this Agreement or a

provision incorporated in a condition of Carriage or

tariff pursuant to this Agreement be determined to be

invalid, illegal or unenforceable by a court of

competent jurisdiction, all other provisions shall

nevertheless remain valid, binding and effective.

l. This Agreement may be signed in any

number of counterparts, all of which shall

constitute one Agreement. Any carrier may

become Party to this Agreement by signing a

counterpart hereof and depositing it with the

Director General of the International Air

Transport Association (IATA).

2 Any carrier Party hereto may withdraw from

this Agreement by giving twelve (12)

months’ written notice of withdrawal to the

Director General of IATA and to the other

carriers Parties to the Agreement.

3. The Director General of IATA shall declare

this Agreement effective on November st,

1996 or such later date as all requisite

Government approvals have been obtained for

this Agreement and the IATA Intercarrier

Agreement of 31 October, 1995.

Signed this date of 1996.

ld

APPENDIX D

Signatories to IIA Agreement as of July 9, 1998

Aero Lingus plc

Aervias de México, S.A. de C.V. (Aeromexico)

Air Afrique

Air Aruba

Air Baltic Corporation SIA

Air Canada

Air Exel Commuter

Air France

Air Jamaica Limited

Air Mauritius

Air New Zealand

Air Pacific Limited

Air UK Group Limited

Air Vanuatu

Alaska Airlines

Alitalia

All Nippon Airways Co., Ltd.

Allegheny Airlines, Inc.

America West Airlines, Inc.

American Airlines

American Trans Air, Inc.

Asiana

Augsburg Airways GmbH

Austrian Airlines

Avianca

Azerbaijan Hava Yollary

Braathens S.A.F.E.

British Airways, plc

—— ee ee eee |

2d

Canadian Airlines, International

Cathay Pacific Airways, Ltd.

Central Mountain Air Ltd.

Cimber Air A/S

Compagnie Air France Europe

Continental Airlines, Inc.

Continental Express

Continental Micronesia

Croatia Airlines

Crossair

CSA - Czech Airlines

Delta Air Lines, Inc.

Deutsche BA Luftfahrtgesellschaft mbH

Deutsche Lufthansa AG

Egyptair

Emirates

Estonian Air

Eurowings Luftverkehrs AG

Finnair OY

Garuda Indonesia

GB Airways

Hawaiian Airlines

Heli Air AG

Heli-Linth AG

Iberia

Icelandair

Interimpex-A vioimpex

Japan Air Charter (JAZ)

Japan Air System Co. Ltd.

Japan Airlines Co. Ltd.

Japan Asia Airways (JAA)

Jet Airways (India) Pvt Ltd.

3d

Kenya Airways

Kiwi International Air Lines

KLM Cityhopper B.V.

KLM Royal Dutch Airlines

Korean Air Lines Co., Ltd.

LAPSA Lineas Aéreas Paraguayas

Lauda Air Luftfahrt AG

Luxair

Maersk Air A/S

Maersk Air Ltd.

Malaysia Airlines

Malev - Hungarian Airlines Public Ltd. Co.

Martinair Holland N.V.

Midwest Express Airlines, Inc.

Northwest Airlines

Pakistan International Airlines (PIA)

PGA Portugilia Airlines

Piedmont Airlines, inc.

Polskie Linie Lotnicze - Polish Airlines

PSA Airlines, Inc.

Qantas Airways Limited

Reeve Aleutian Airways, Inc.

Regional Airlines

Royal Air Maroc

SABENA

Saudi Arabian Airlines Corp.

Scandinavian Airlines Systems (SAS)

Singapore Airlines Ltd.

Sobelair

South African Airways

Swissair

TACA

4d

TAP Air Portugal

TAT European Airlines

Trans World Airlines Inc. (TWA)

Transavia airlines C.V.

Transbrasil S/A Linhas Aéreas

Trinidad & Tobago BWIA International

Tiirk Hava Yollari A.O. (Turkish Airlines Inc.)

Tyrolean Airways - Tiroler Luftfahrt -AG

United Airlines

UPS Airlines

USAir, Inc.

Varig S.A.

VIASA

Signatories to MIA Agreement as of July 9, 1998

Air Afrique

Air Baltic Corporation SIA

Air Canada

Air France

Air New Zealand

Air Pacific Limited

Alaska Airlines

Allegheny Airlines, Inc.

America West Airlines, Inc.

American Airlines

American Trans Air, Inc.

AMR Combs BJS, Inc.

AMR Eagle, Inc.

Asiana

Austrian Airlines

Avianca

British Airways, plc

Sd

Canadian Airlines, International

Cathay Pacific Airways, Ltd.

Central Mountain Air Ltd.

Compagnie Air France Europe

Continental Express

Continental Micronesia

Crossair

CSA - Czech Airlines

Delta Air Lines, Inc.

Deutsche BA Luftfahrtgesellschaft mbH

Deutsche Lufthansa AG

Estonian Air

Finnair OY

GB Airways

Heli Air AG

Heli-Linth AG

Icelandair

Kenya Airways

Kiwi International Air Lines

KLM Royal Dutch Airlines

Korean Air Lines Co., Ltd.

6d

Qantas Airways Limited

Reeve Aleutian Airways, Inc.

Royal Air Maroc

SABENA

Scandinavian Airlines Systems (SAS)

Singapore Airlines Ltd.

Sobelair

Swissair

TAP Air Portugal

TAT European Airlines

Trans World Airlines Inc. (TWA)

Transavia Airlines C.V.

Transbrasil S/A Linhas Aéreas

Tiirk Hava Yollari A.O. (Turkish Airlines Inc.)

Tyrolean Airways - Tiroler Luftfahrt -AG

United Airlines

UPS Airlines

USAir, Inc.

Varig S.A.