Petition for Writ of Certiorari — Northwest Airlines, Inc. v. Duncan

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No. ——

IN THE

Supreme Court of the Anited States

NORTHWEST AIRLINES, INC..

Petitioner,

Vv.

JULIE DUNCAN,

Respondent.

Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Ninth Circuit

PETITION FOR A WRIT OF CERTIORARI

TOM TINKHAM

DORSEY & WHITNEY LLP

Pillsbury Center South

220 South Sixth Street

Minneapolis, MN 55402

(612) 340-2829

PAUL M. SMITH *

MICHAEL B. DESANCTIS

JENNER & BLOCK

601 Thirteenth Street, N.W.

Washington, D.C. 20005

(202) 639-6000

DAVID P. SANDERS

JENNER & BLOCK

One IBM Plaza

Chicago, IL 6061 |

(312) 222-9350

Counsel for Petitioner

* Counsel of Record

a

WILSON-EPES PRINTING Co., INC. — (202) 789-0096 - WASHINGTON, D.C. 20001

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UU +

QUESTION PRESENTED

Section 105(a)(1) of the Airline Deregulation Act preempts

all state laws and regulations “related to a price, route or

service of an air carrier.” 49 U.S.C. § 41713(b)(1). The

question presented is whether the court below erred when it

held, in conflict with other courts of appeals, that a state may

regulate any “service” provided on an international or interstaie

flight if the service does not involve price or route

determinations.

LIST OF PARTIES

AND

CORPORATE DISCLOSURE STATEMENT

The caption of this case contains the names of all parties

that were before the United States Court of Appeals for the

Ninth Circuit and the United States District Court for the

Western District of Washington.

Petitioner Northwest Airlines, Inc. is an indirect, wholly

owned subsidiary of Northwest Airlines Corporation, a publicly

traded company. As of December 31, 1999, based on a

Schedule 13G filed with the Securities and Exchange

Commission, AXA Financial, Inc. (formerly known as the

Equitable Companies Incorporated), through subsidiaries and

affiliates, had a beneficial ownership of more than 10% of the

common stock of Northwest Airlines Corporation.

TABLE OF CONTENTS

Page

eh ea i

LIST OF PARTIES AND CORPORATE

DISCLOSURE STATEMENT ................... TT

MME occ ccc cccccccccccescess Vv

ee dk ccc ecceecceccces 2

ccc csccees 2

STATUTORY PROVISION INVOLVED .............. 2

Ne tien ace weeeeesecececes 3

REASONS FOR GRANTING THE WRIT ............. 6

|. The Circuits Are in Fundamental and

Irreconcilable Conflict Over the Proper

Interpretation of the ADA Preemption

eee eee kecceeccccccecce 9

A. The Emergence and Scope of the Conflict .... 9

B. The Practical Impact of the Conflict ........ 19

Il. The Ninth Circuit’s Rules Are Particularly

Problematic Because They Expose Airlines

to Forms of State Regulation Congress

Clearly Intended to Preempt. ................ 21

EE EES 24

APPENDIX A

Opinion, Duncan v. Northwest Airlines, Inc.,

No. 98-35617 (9th Cir. Apr. 6, 2000) ... 2.2.2.2... la

iv

APPENDIX B

Order, Duncan v. Northwest Airlines, Inc.,

No. C98-130Z (W.D. Wash. June 5, 1998) ........

APPENDIX C

Order on Petition for Rehearing, Duncan v.

Northwest Airlines, Inc., No. 98-35617

i CE SD iu. soca eaeawecseaeeds

APPENDIX D

Statutory Provision Involved ..................

APPENDIX E

Class Action Complaint for Injunctive Relief,

Medical Monitoring and Damages, Duncan vy.

Northwest Airlines, Inc., No. 98-2-01158-1SEA

(Super. Ct. Wash. filed Jan. 13,1998) ...........

20a

TABLE OF AUTHORITIES

CASES

Abdu-Brisson v. Delta Airlines, Inc., 128 F.3d 77

RTI gl od iba ee a ate Eo 17,18

Abdullah v. American Airlines, Inc., 181 F.3d 363

RIERA SOS A REED LE ihe os hy SAR Oe 16

American Airlines, Inc. v. Wolens, 513 U.S. 219

TRAPATT EY ae 6, 10, 16, 22

Charas v. Trans World Airlines, Inc., 160 F.3d 1259

(9th Cir. 1998), amended, 169 F.3d 594

8 Ee ange passim

Chukwu v. Board of Directors of British Airways,

889 F. Supp. 12 (D. Mass. 1995), aff'd mem.,

101 F.3d 106 (1st Cir. 1996) .................... i4

Exxon Corp. v. Hunt, 475 U.S. 355 (1986) .......... 21

Galbut v. American Airlines, Inc., 27 F. Supp. 2d 146

Pe eo ete be cele er ead ee 11,14

Hobbs v. Labor Commission, 991 P.2d 590

EE CED ones séuueensneecadantsess 10

Hodges v. Delta Airlines, Inc., 44 F.3d 334 (Sth Cir.

SEED ccncedtnacencscacbeneasansseuseses passim

Kungys v. United States, 485 U.S. 759 (1988) ........ 21

Morales v. Trans World Airlines, Inc., 504 U.S. 374

Dt sc hckunse ceuandadhaeneensaunasess passim

Newman v. American Airlines, Inc., 176 F.3d 1128

i ee a er ae 19

vi

O'Carroll v. American Airlines, Inc., 863 F.2d 11

ad ed ae ee ec aeeen 12

Parise v. Delta Airlines, Inc., 141 F.3d 1463

ee ee ea eke es 14

Smith v. Comair, Inc., 134 F.3d 254 (4th Cir.

DE dis ctbebendeas ebdaddisenaeesses ed 8, 14, 20

Taj Mahal Travel, Inc. v. Delta Airlines, Inc.,

164 F.3d 186 (3d Cir. 1998) ................. 10, 16

Travel All Over The World, Inc. v. Kingdom of

Saudi Arabia, 73 F.3d 1423 (7th Cir. 1996) ........ 13

United Airlines, Inc. v. Mesa Airlines, Inc.,

219 F.3d 605 (7th Cir. 2000) ....... chew es 18, 19, 20

Woodson v. U.S. Airways, Inc., 67 F. Supp. 2d 554

tt tis cestdudhwcwidesduneus 10, 11, 22

STATUTES AND ADMINISTRATIVE MATERIALS

a os ea ecuueaneneas 2

A ae 2

BRUISE: GUID occ ccc cccccccccescccscesses 2

I ee ee cuudienuauenas 2

a 2

49 U.S.C. §4171Z(DML) o.oo cece eee es 2, 3,6

49 U.S.C. App. § 1506... 20... cece cece eee eee 16

ee 3

44 Fed. Reg. 9948 (Feb. 14, 1979) ........ 11, 12, 22, 23

vil

49 Fed. Reg. 25408 (June 20, 1984)

65 Fed. Reg. 36772 (June 9, 2000)

IN THE

Supreme Court of the United States

No.

NORTHWEST AIRLINES, INC.,

Petitioner.

V.

JULIE DUNCAN,

Respondent

Petition for a Writ of Certiorari to the

United States Court of Appeals for the Ninth Circuit

PETITION FOR A WRIT OF CERTIORARI

Petitioner Northwest Airlines, Inc. (‘Northwest’)

respectfully requests this Court to issue a writ of certiorari to

review a decision of the United States Court of Appeals for the

Ninth Circuit. In that decision, the Ninth Circuit adopted an

interpretation of the Airline Deregulation Act that conflicts

both with the rule in other circuits and with the intent of

Congress because it allows states to regulate or prohibit any

airline policy regarding a “service” not directly related to fares

or routes, even if the policy was adopted in order to compete in

the deregulated marketplace Congress sought to foster.

2

OPINIONS BELOW

The decision of the United States Court of Appeals for the

Ninth Circuit, reported at 208 F.3d 1112 (9th Cir. 2000), is

reprinted at Pet. App. la. The unreported order of the United

States District Court for the Western District of Washington is

reprinted at Pet. App. 9a. The unpublished order of the United

States Court of Appeals for the Ninth Circuit denying rehearing

and rehearing en banc is set forth at Pet. App. 19a.

JURISDICTION

Northwest properly removed this suit to the United States

District Court for the Western District of Washington pursuant

to 28 U.S.C. §§ 1441, 1446. Jurisdiction in the district court

was proper under 28 U.S.C. § 1332(a). The Ninth Circuit had

jurisdiction to review the district court’s dismissal of the case

pursuant to 28 U.S.C. § 1291. The Ninth Circuit issued its

decision on April 6, 2000. Northwest timely filed a petition for

rehearing and rehearing en banc, which was denied on June 16,

2000. The jurisdiction of this Court is invoked pursuant to 28

U.S.C. § 1254(1).

STATUTORY PROVISION INVOLVED

This case involves section 105(a)(1) of the federal Airline

Deregulation Act (“ADA”), now codified at 49 U.S.C. §

41713(b)(1), which provides as follows:

Preemption — Except as provided in_ this

subsection, a State, political subdivision of a State, or

political authority of at least 2 States may not enact or

enforce a law, regulation, or other provision having the

force and effect of law related to a price, route, or service

3

of an air carrier that may provide air transportation under

this subpart.

Pet. App. 20a.

STATEMENT

Petitioner Northwest Airlines seeks review of a ruling by

the Ninth Circuit that dramatized and exacerbated a long-

standing and explicit conflict among the circuits over the

proper interpretation of section 105(a)(1) of the ADA, 49

U.S.C. § 41713(b)(1), in which Congress preempted any

provision of state law relating to an airline’s “price, route, or

service.” Because that conflict will not disappear absent action

by this Court, and because the current disarray in the law is

both unworkable — from the point of view of airlines operating

in an interstate environment — and inconsistent with the will of

Congress, the argument for a grant of review in this case is

compelling.

This case was filed by a flight attendant in state court in

Washington, alleging, on behalf of a proposed class of flight

attendants on Northwest’s trans-Pacific flights, that Northwest

was liable under state tort law for allowing passengers to smoke

on those flights. At the time the action was filed, Northwest

did not allow smoking on domestic flights or on many

international flights but, consistent with federal regulations, '

‘Under 14 C.F.R. Part 252, federal authorities have regulated on-board

smoking for decades. Until this year, those federal regulations permitted

smoking on international flights, subject to certain restrictions. This past

June, the regulations were amended to ban smoking on flights of domestic

air carriers originating or terminating in the United States. 65 Fed. Reg.

36772 (June 9, 2000). A similar ban applicable to foreign air carriers is

subject to potential waiver if the applicable foreign governments object to

4

did allow smoking on some Asian flights. It was acknowledged

by respondent, Pet. App. 22a-23a, that Northwest adopted this

service policy because it was necessary to compete with foreign

air carriers that allowed smoking on the same routes.

Respondent alleged that this service policy was, nevertheless,

a breach of Northwest’s duty, under state tort law, to provide a

safe and healthy working environment.

The case was removed to federal court, and the district

court dismissed the case as preempted by section’ 105(a)(1),

reasoning that allowing respondent’s tort claim to proceed

would be tantamount to allowing state regulation of a “service”

provided to Northwest customers on trans-Pacific flights. Pet.

App. 15a-17a. The district court’s ruling was based on then-

applicable Ninth Circuit case law, which in turn was based on

the Fifth Circuit’s en banc ruling in Hodges v. Delta Airlines,

Inc., 44 F.3d 334 (Sth Cir. 1995). Pet. App. 12a-17a (citing

Gee v. Southwest Airlines, 110 F.3d 1400, 1404-07 (9th Cir.

1997), overruled on other grounds by Charas v. Trans World

Airlines Co., 160 F.3d 1259 (9th Cir. 1998)). Hodges, in

essence, established the rule that states may not regulate airline

decisions about “services,” broadly defined, but that tort suits

challenging the manner in which a service was performed on a

given day are permissible. While the case was pending on

appeal, however, the Ninth Circuit issued an en banc decision

in Charas v. Trans World Airlines, Inc., 160 F.3d 1259 (9th

Cir. 1998), amended, 169 F.3d 594 (9th Cir. 1999), which

radically altered the governing standards in that circuit.

the extraterritorial application of United States law. /d. During the

pendency of this case, but prior to the imposition of the new federal

regulations, Northwest made a decision to ban smoking on all flights,

including those to and from Asia.

5

Charas started with the proposition that the ADA

preemption provision should be interpreted in light of the

congressional goal of shielding the newly deregulated airlines

from re-regulation by the states. It then held that preemption of

“run-of-the-mill personal injury claims” arising from negligent

operations would not further the goal of preserving

deregulation and promoting competition. 160 F.3d at i261.

Finally, the court concluded that the only way to limit the

scope of section 105(a)(1) (and thus save personal injury claims

from preemption) is to interpret the term “service” in that

section as adding nothing to the prior terms “price” and

“route.” As a result, although section 105(a)(1) preempts state

laws that relate to an airline’s “price, route or service,”

(emphasis added) the Charas court interpreted “service” as

encompassing only matters that would already be preempted as

involving airline “routes” — “such things as the frequency and

scheduling of transportation, and . . . the selection of markets

to or from which transportation is provided,” /d. at 1265-66.

Because that definition of “service” conflicted with Hodges,

Charas expressly overruled two Ninth Circuit cases that had

relied on Hodges, and the opinion acknowledged that it was

creating a direct conflict with Hodges. Id. at 1261, 1263.

In the present case, a panel of the Ninth Circuit then

applied Charas, not to a “run-of-the-mill personal injury

claim,” id. at 1261, but to aclaim challenging an airline service

policy of allowing smoking on certain flights. It held that such

a policy was also fully exposed to state regulation through tort

law. In so doing, the Ninth Circuit underscored its position

about the superfluousness of the term “service” in the statute.

Writing for the panel, Judge Reinhardt stated that the

Northwest policy of allowing smoking on trans-Pacific flights

did not involve a “service” protected from state regulation,

because it was not “‘a decision dealing with ‘the frequency and

6

scheduling of transportation, [or] the selection of markets to or

from which transportation is provided.” Pet. App. 5a (quoting

Charas, 160 F.3d at 1265-66).

Thus, the court applied a definition of “service,” which it

initially adopted in Charas for the stated purpose of limiting

preemption to matters that affect airline competition, to

preserve a state-law challenge to an airline service policy that

was implemented by Northwest in order to “meet the

competition.” And it then went further, holding that a state-law

tort claim would not be preempted even if it could be shown to

have the potential to force an airline to re-route its flights to

another state in order to avoid liability. The court explained

that such a causal connection to airline “routes” would be “too

tenuous” to warrant preemption. Pet. App. 6a-7a. Thus, in the

wake of the ruling below, the only state tort claims that would

be preempted under section 105(a)(1) would be claims directly

challenging an airline’s decision to set a particular price or fly

a particular route.

REASONS FOR GRANTING THE WRIT

This case presents a question of fundamental importance

concerning the proper interpretation of section 105(a)(1) of the

ADA, which preempts any state “law, regulation, or other

provision having the force and effect of law related to a price,

route, or service of an air carrier.” 49 U.S.C. § 41713(b)(1).

Since this Court’s decisions in Morales vy. Trans World

Airlines, Inc.,504 U.S. 374 (1992), and American Airlines, Inc.

v. Wolens, 513 U.S. 219 (1995), serious and persistent

disagreements have emerged in circuit court cases applying

section 105(a)(1) to state tort claims. Those disagreements

include both divergent views about the basic mode of analysis

that should be applied and a specific conflict over the meaning

of the statutory term “service.” This conflict will not resolve

itself because the two principal approaches to interpreting the

statute are based on en hanc rulings of the Fifth and Ninth

Circuits, each of which has been repeatedly endorsed by other

circuits. As a result, absent intervention by this Court, airlines

will continue to have to deal with two quite distinct legal

regimes, depending on which circuit’s law happens to apply.

The evident confusion in the lower courts would be reason

enough to justify a grant of review even if both of the

competing rules were arguably defensible. But the problem is

even more serious because, as this case illustrates, the Ninth

Circuit has adopted such a narrow interpretation of the ADA

preemption provision that the statutory goals of Congress are

being frustrated. It is the Ninth Circuit that strongly

emphasized in Charas the need to apply section 105(a)(1) with

an eye to the congressional goal of promoting competition

among the airlines in a newly deregulated environment. But in

its zeal to limit the scope of preemption to matters affecting

competition, the Ninth Circuit in Charas went much too far

when it excluded from preemption all tort claims — and all other

forms of state regulation — not directly related to an airline

“price” or “route.”

The effect of that exclusion was dramatized in this case,

where the Ninth Circuit confirmed its rule that the third

statutory term — “service” — is always treated as mere

surplusage, adding nothing to the scope of the preemption

provision, even where such a narrow statutory interpretation

flatly disserves the congressional goal of promoting free

competition. Thus, in the Ninth Circuit, state regulation of

airline policies relating to smoking, service of alcohol,

overbooking, boarding of passengers and other matters not

directly involving prices or routes may proceed unfettered,

8

even where the policies subject to attack were adopted for the

sole purpose of ‘‘meeting the competition." Meanwhile, in

several other circuits, it is well estabiished that such state law

causes of action would be preempted. See, e.g., Hodges; Smith

v. Comair, Inc., 134 F.3d 254 (4th Cir. 1998).

The ruling below also extended Charas in another

extraordinary way. The Ninth Circuit held that, even if a cause

of action under a state’s tort law were so burdensome that it

effectively forced airlines to alter their routes to avoid that

state, that would not be enough to justify preemption. Here

again, it seems likely that the court’s rule will disserve the

statutory goals — and it is certain that other circuits applying

section 105(a)(1) would not ignore the practical but indirect

impact of a state law on airline route decisions.

The inevitable result of allowing the circuit conflicts to

linger will be to leave in place a checkerboard of state

regulation, requiring airlines to vary their policies from place

to place as they attempt to compete for passengers while

adhering to the most restrictive state rule that might be applied

to a given flight between two different states. The Court should

step in to restore uniformity in an area where it is a practical

necessity. This case, involving an airline policy that was

adopted for the purpose of competing with foreign carriers and

would be shielded from preemption under one of the competing

approeches to interpreting the Act but not the other, provides an

excellent and timely vehicle for addressing these important

issues.

9

i. The Circuits Are in Fundamental and Irreconcilable

Conflict Over the Proper Interpretation of the ADA

Preemption Provision.

A. The Emergence and Scope of the Conflict

The conflict among the circuits at issue here involves

forms of state regulation not at issue in the two cases where this

Court applied the ADA preemption provision and established

a basic framework for the preemption analysis. First, in

Morales v. Trans World Airlines, Inc., 504 U.S. 374, 391

(1992), the Court held that section 105(a)(1) bars states from

enforcing their general consumer protection statutes through

state-created guidelines aimed at prohibiting false and

misleading airfare advertising. The Morales Court recognized

that Congress in the ADA sought to place “*maximum reliance

on competitive market forces’” and intended the preemption

provision “[t]o ensure that the States would not undo federal

deregulation with regulation of their own.” /d. at 378 (quoting

49 US.C. App. §§ 1302(a)(4), 1302(a)(9)) (alterations in

original). The Court then noted that the words of section

105(a)(1) “express a broad preemptive purpose,” id. at 383, and

therefore reyected the argument that the ADA preempted only

state laws that specifically address the airline industry. Instead,

the Court made clear that the ADA’s preemption provision

a plies with equal force to general laws that are “not

specifically designed to affect” rates, routes, or services but

have such an effect directly or indirectly. /d. at 386 (internal

quotation and citation omitted).

Applying this analysis, the Court recognized that, while

[s]ome state actions may affect [airline fares] in too tenuous,

remote or peripheral a manner’ to have preemptive effect,” id.

at 390 (quoting Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 100

eee

10

n.21 (1983)) (alteration in original), “the obligations imposed

by the [advertising] guidelines would have a significant impact

upon the airlines’ ability to market their product, and hence a

significant impact upon the fares they charge.” /d. Accordingly,

the state advertising regulations were preempted.

Three years later, in Amer can Airlines, Inc. v. Wolens, 513

U.S. 219(1995), this Court dealt with state law challenges to an

airline’s retroactive modification of its frequent flyer program.

The Court held that the plaintiffs’ fraud claims were preempted.

Id. at 228. Applying the language of section 105(a)(1), it

concluded that those claims related both to the airline’s “rates,”

in the form of mileage credits for free tickets, and to the

“service” of access to flights and class upgrades. See id. at 226.

In the wake of Morales and Wolens, a striking conflict

among the circuits has developed concerning the proper

application of section 105(a)(1) to other kinds of state law tort

claims and concerning the meaning of the term “service” in that

section. See, e.g., Taj Mahal Travel, Inc. v. Delta Airlines,

Inc., 164 F.3d 186, 192 (3d Cir. 1998) (“In the absence of

definitive guidance from the Supreme Court, the Courts of

Appeals have struggled with the relationship between the

[Airline Deregulation} Act’s preemption clause and state tort

claims.”); Hobbs v. Labor Comm'n, 991 P.2d 590, 594 n.6

(Utah Ct. App. 1999) (“Currently there is no single

interpretation of what is encompassed by the term ‘service’ [in

the ADA].”); Woodson v. U. S. Airways, Inc., 67 F. Supp. 2d

The Court held that the plaintiffs’ contract claims were not preempted,

however, because a state's enforcement of private contractual obligations

simply holds parties’ to their own agreements and does not constitute a

“law” relating to a price, route or service of an air carrer within the meaning

of the ADA’s preemption clause. See Wolens, 513 U.S. at 228-33.

554, 557 (M.D.N.C. 1999) (“courts interpreting the scope of

preemption under the ADA have failed to reach consisient

results”); Galbut v. American Airlines, Inc., 27 F. Supp. 2d 146,

151 (E.D.N.Y. 1997) (“Based on the Morales ruling, the scope

of the word ‘services’ has proven critical in preemption analysis

with respect to tort claims, although no singular definition has

emerged despite repeated scrutiny” (citing cases)).

One leading interpretation was enunciated by the en banc

Fifth Circuit in Hodges. There, the plaintiff brought a personal

injury tort suit for injuries suffered when an object fell out of an

overhead bin. In determining whether the plaintiff's claim

“related to a price, route or service of an air carrier,” the

Hodges court defined the term “service” broadly as follows:

“Services” generally represent a _ bargained-for or

anticipated provision of labor from one party to another.

If the element of bargain or agreement is incorporated in

our understanding of services, it leads to a concern with

contractual arrangement between the airline and the use of

the service. Elements of the air carrier service bargain

include items such as ticketing, boarding procedures,

provision of food and drink, and baggage handling, in

addition to the transportation itself. These matters are all

appurtenant and necessarily included with the contract of

carriage between the passenger or shipper of the airline. It

is these [contractual] features of air transportation that we

believe Congress intended to de-regulate as “services” and

broadly to protect from state regulation.

44 F.3d at 336 (emphasis added and alteration in original).

* This definition was derived in large part from statements issued by

the Civil Aeronautics Board (“CAB”) implementing section 105(a1). 44

F.3d at 337. According to the CAB,

12

Next, drawing on this Court’s Morales decision, Hodges

held that only those tort claims that make specific reference to

airline services or “significantly affect” such services are

preempted. /d. at 340. Applying this standard in light of its

broad definition of “services,” the court then distinguished

between tort claims that concern an airline’s policy of providing

a given service and those that go only to the manner in which

those services are provided. Only the former would

“significantly affect” the airline’s services and be preempted.

Id. at 339-40. The latter, which the court characterized as

claims concerning the “operation and maintenance” of the

aircraft, would not. /d.

As an example of tort claims preempted under this

standard, the court reaffirmed its earlier holding in O Carroll

v. American Airlines, Inc., 863 F.2d 11 (Sth Cir. 1989). There,

the plaintiffs, who had been removed from a flight for being

intoxicated and disruptive, sued under state tort law for having

been wrongfully evicted from the flight. According to the

Hodges court, the O'Carroll plaintiffs’ claims were properly

held preempted: “[e}]nforcement of O’Carroll’s state law claims

would result in significant de facto regulation of the airlines’

[P]reemption extends to all of the economic factors that go into the

provision of the quid pro quo for passenger's fare, including flight

frequency and timing, liability limits, reservation and boarding

practices, insurance, smoking rules, meal service, entertainment,

bonding and corporate finance. . . . [A] state may not interfere with the

services that carriers offer in exchange for their rates and fares. For

example, liquidated damages for bumping (denial of boarding),

segregation of smoking passengers, minimum liability for loss,

damages and delayed baggage, and ancillary charges for headsets,

alcoholic beverages, entertainment, and excess baggage would clearly

be “service” regulation within the meaning of section 105.

44 Fed. Reg. 9948, 9951 (Feb. 14, 1979).

13

boarding practices and, moreover, would interfere with federal

law granting the airlines substantial discretion to refuse to carry

passengers.” 44 F.3d at 339 (citing 49 U.S.C. App. § 1511(a)).

By contrast, the personal injury negligence claim in

Hodges related not to the airline’s policy concerning its

baggage services, but only to the manner in which those

services were rendered. Accordingly, the plaintiff's claim

would not “significantly affect” the airline’s baggage services

within the meaning of the ADA and was not, therefore,

preempted. /d. at 340.

Hodges was followed by the Seventh Circuit in 7ravel All

Over The World, Inc. v. Kingdom of Saudi Arabia, 73 F.3d

1423 (7th Cir. 1996). There, after noting the considerable

confusion in the lower courts over the ADA’s preemptive

reach, see id. at 1433 (citing cases arriving at inconsistent

results in slander and defamation cases), the court adopted the

Fifth Circuit’s broad definition of “service” as used in section

105(aX(1) of the ADA. /d. In addition, the court held,

consistent with the Fifth Circuit’s analysis in Hodges, that a

claim relates to an airline’s services and therefore is preempted

if it has a “significant economic effect” on those services. /d.

at 1432-33.

Applying this test, the Seventh Circuit held that the

plaintiff travel agency’s slander and defamation claims against

an airline were not preempted. See id. at 1433. By contrast, the

court held that the plaintiff's intentional tort claims, based on

the airline’s refusal to honor the tickets issued by plaintiff, were

preempted because they “expressly referr[ed] to airline

‘services,’ which include ticketing as well as the transportation

itself.” Jd. at 1434.

14

The Eleventh Circuit has also adopted the Seventh

Circuit’s “significant economic effect” test, originally derived

from Hodges. Parise v. Delta Airlines, Inc., 141 F.3d 1463,

1465-66 (11th Cir. 1998) (citing Travel All Over the World, 73

F.3d at 1431). And the Fourth Circuit has likewise expressly

adopted the broad definition of “service” announced in Hodges.

In Smith v. Comair, Inc., 134 F.3d 254 (4th Cir. 1998), the

plaintiff passenger sued the defendant airline for intentional

torts and breach of contract arising out of the airline’s refusal

to allow him to board after he failed to produce proper

identification. Citing Hodges, the court concluded that,

“({u]ndoubtedly, boarding procedures are a service rendered by

an airline.” /d. at 259 (citing Hodges, 44 F.3d at 336; Chukwu

v. Bd. of Dirs. of British Airways, 889 F. Supp. 12, 13 (D.

Mass. 1995), aff'd mem., 101 F.3d 106 (1st Cir. 1996)). Thus,

to the extent that the plaintiff's intentional tort claims were

based on the airline’s “boarding practices,” they were

preempted. /d. Consistent with Hodges, however, the court

also made clear that, in contrast to claims concerning an

airline’s policies or practices, “[sjuits stemming from

outrageous conduct on the part of an airline toward a passenger

will not be preempted under the ADA if the conduct too

tenuously relates or is unnecessary to an airline’s services.” /d.

(citing Rombom v. United Air Lines, Inc., 867 F. Supp. 214,

222, 224 (S.D.N.Y. 1994)).*

* A number of federal district courts in other circuits have adopted and

applied the definitions and reasoning of the Fifth, Seventh, Fourth and

Eleventh Circuits. See e.g., Chukwu v. Bd. of Dirs. of British Airways, 889

F. Supp. 12, 13-14 (D. Mass. 1995), aff'd mem., 101 F.3d 106 (1st Cir.

1996) (citing Hodges and adopting Fifth Circuit's definition of services);

Galbut, 27 F. Supp. 2d at 152 (citing Travel All Over The World to support

proposition that upgrade is a “service”’).

15

As noted above, the en banc Ninth Circuit in Charas broke

ranks with all of these circuits that have followed the Hodges

approach. Unlike the Fifth and Seventh Circuits’ “significant

economic effect” test, the test fashioned in Charas limits the

ADA’s preemptive force to state laws “adversely affect[ing] the

economic deregulation of the airlines and forces of competition

within the airline industry.” 160 F.3d at 1261. Moreover, the

court went on to hold that “[!]Jike ‘rates’ and ‘routes,’ Congress

used ‘service’ in § 1305(a)(1) in the public utility sense -- i.e.,

the provision of air transportation to and from various markets

at various times.” /d. at 1266. The court explained:

Congress used the word “service” in the phrase “rates,

routes, or service,” in the ADA’s preemption clause to

refer to the prices, schedules, origins and destinations of

the point-to-point transportation of passengers, cargo, or

mail. In the context in which it was used in the Act,

“service” was not intended to include an airline’s provision

of in-flight beverages, personal assistance to passengers,

the handling of luggage, and similar amenities.

Id. at 1261. Elsewhere, the court explained that “‘service,’

when juxtaposed to ‘rates’ and ‘routes,’ refers to such things as

the frequency and scheduling of transportation, and to the

selection of markets to or from which transportation is provided

(as in, ‘This airline provides service from Tucson to New York

twice a day.’)”). /d. at 1265-66.

In addition to adopting this narrow definition of “service”

~ one that renders the term virtually synonymous with the word

“route” — the Ninth Circuit in Charas also expressly rejected

as unworkable the Hodges court’s distinction between an

airline’s policy to provide a service and the performance of a

service through the “operation and maintenance” of its aircraft.

16

Id. at 1263 (citing and expressly rejecting Hodges, 44 F.3u at

336-37).

The Ninth Circuit’s analysis was adopted by the Third

Circuit in Taj Mahal Travel, Inc. v. Delta Airlines, Inc., 164

F.3d 186 (3d Cir. 1998). After exhaustively surveying the

disagreements among the circuits, the Third Circuit chose to

follow Charas and held that “the proper inquiry is whether a

common law tort remedy frustrates deregulation by interfering

with competition through public utility-style regulation.” Taj

Mahal Travel, 164 F.3d at 194 (citing Charas, 160 F.3d at

1265-66). Thus, like the Ninth Circuit, the Third Circuit

broadly concluded that “preemption is inappropriate in the tort

field.’ Jd. The Third Circuit further joined in the Ninth

Circuit’s rejection of the Fifth Circuit’s distinction between

service policies and the operation of the aircraft. /d.°

Now, in the instant case, the Ninth Circuit has exacerbated

the interpretive rift between it and some of its sister circuits.

‘The Third Circuit found support for this proposition in the savings

clause of the Federal Aviation Act (“FAA”), 49 U.S.C. App. § 1506. 164

F.3d at 194. But see Morales, 504 U.S. at 384-85 (rejecting argument that

Court could look to FAA’s savings clause for guidance in applying the

ADA’s preemption provision to tort claims); Wolens, 513 U.S. at 232

(ADA’s preemption provision and FAA’s savings clause together permit

states to enforce contracts made by airlines but prevents states from

“imposing their own substantive standards with respect to rates, routes, or

services” through application of their tort law).

*“Compounding the prevailing confusion, while the Third Circuit joined

the Ninth Circuit’s analysis in Charas, which was motivated by a desire to

avoid preemption of routine personal injury claims, the Third Circuit held

more recently in Abdullah v. American Airlines, Inc., 181 F.3d 363, 367 (3d

Cir. 1999), that the entire field of airline safety is preempted as a matter of

field preemption under the FAA.

17

Applying Charas’s definition of “services,” Judge Reinhardt

stated that an airline’s deliberate policy of allowing smoking is

not a “service” protected from state regulation by the ADA

because “[a]n airlines’ decision to permit (or not to permit)

smoking on a flight is not a decision dealing with ‘the

frequency and scheduling of transportation, [or] the selection of

markets to or from which transportation is provided.”” Pet.

App. Sa (alteration in original) (quoting Charas, 160 F.3d at

1265-66).’

The Ninth Circuit then went on to create a bright-line rule

that the threat of a state-law personal-injury action can never

have a sufficient impact on airlines operating to justify

preemption — i.e., that “the connection between an award in a

tort case and an airline’s ‘services’ is simply too tenuous” to

justify preemption under the ADA. Pet. App. 6a-7a. In so

doing the court made clear that, even where it could be

demonstrated that the application of state tort law would

significantly impact an airline’s services by forcing it to re-

route its flights, the “causal relationship” between a tort suit

and the airline’s routes and services “‘is not sufficient to invoke

preemption under § 1305(a)(1).” /d. at 6a.*

This conclusion is patently at odds with CAB regulations

_implementing the ADA. See supra, p. 12 n.3.

*The Second Circuit has adopted somewhat ofa hybrid rule, combining

elements of the Ninth and Third Circuits’ approach with that of the Fifth,

Seventh, Fourth and Eleventh Circuits. In Abdu-Brisson v. Delta Airlines,

Inc., 128 F.3d 77 (2d Cir. 1997), it held, like the Ninth Circuit, that the

primary focus of the preemption analysis must be congressional intent,

which it characterized as preempting laws that “affect competition between

airlines.” /d. at 84. At the same time, however, the court rejected

application of any bright-line rule and insisted on a case-by-case approach

to ascertain “whether the dangers and hardships of diverse regulation justify

(continued...)

18

Given the depth of the disagreement among the circuits,

—there is little reason to suppose that the conflict will resolve

itself. For example, the Ninth Circuit in this case declined to

review en banc the panel’s rather extreme application of

Charas. And in United Airlines, Inc. v. Mesa Airlines, Inc.,

219 F.3d 605 (7th Cir. 2000), the Seventh Circuit recently had

occasion to comment on the circuit conflict, and pronounced

that “nothing any other circuit has said about the subject

persuades us to alter course.” /d. at 609. Specifically, the court

reaffirmed the broader test it had adopted in Travel All Over

The World, providing that a claim is preempted if either the

state[’s] rule expressly refers to air carners’ rates, routes, or

services, or application of the state’s rule would have ‘a

significant economic effect upon them.’ /d. (quoting Travel All

Over The World, 73 F.3d at 1432). In doing so, the court

expressly rejected the Third Circuit’s more restrictive

formulation (borrowed from the Ninth Circuit’s decision in

Charas) that “state law is preempted by § 105(a)(1) only if it

‘frustrate[s] Congressional intent [or] impose[s] a state utility-

like regulation on the airlines.”” /d. at 608-09 (quoting 7a

Mahal Travel, 164 F.3d at 195) (alteration in original).’ Indeed,

the Seventh Circuit concluded that the- ADA’s preemption

provision “applies according to its text, rather than according to

goals and motives imputed to legislators,” and thus preempts

*(...continued)

foreclosing a State from the exercise of its traditional powers.” /d. (internal

quotations omitted). Thus, unlike the Ninth Circuit's ngid formulation, the

Second Circuit’s analysis made clear that, if application of a state’s tort-like

human rights laws did in fact frustrate Congress's deregulatory goals, that ~

application of state law would be preempted under the ADA. /d. at 84-86.

*As the Mesa Airlines court recognized, the general anti-fraud statute

held preempted in Wolens was “a long distance from ‘utility-like

regulation.”” /d.

19

even claims not inconsistent with the intent of Congress in

enacting the ADA. /d. at 611 (citing Wolens).

B. The Practical Impact of the Conflict

There ts a pressing need for action by this Court to resolve

the conflicts among the circuits. The circuits’ dramatically

differing interpretations of section 105(a)(1) have real and

immediate implications for the entire-airline industry.

A good example is the area of an airline’s boarding

policies. In the Ninth Circuit, there is no preemption of state

regulation of any airline policy or practice absent a direct link

to an airline's decisions involving rates or routes. See Charas,

160 F.3d at 1261, 1265-66. It follows that a claim that an

airline wrongfully denied a passenger boarding — even if based

on an airline’s policy related to such things as overbooking,

disability, or intoxication — would not be preempted.'® See

Newman v. American Airlines, Inc., 176 F.3d 1128, 1131 (9th

Cir. 2000) (applying Charas and holding that discrimination

claim based on refusal to board passenger with heart condition

absent medical certificate was not preempted because it did not

relate to routes or rates). Indeed, states would be free to adopt

regulations micro-managing such matters as whether airlines

may permit first-class passengers to board first.

‘Under the Ninth and Third Circuit's narrow definition of services,

states apparently are now free to pass laws directly regulating most aspects

of air travel including not only laws prescribing boarding procedures but

also, for example, laws that would limit the number of allowed carry-on

bags, the number of alcoholic beverages served or the categories of in-flight

entertainment available in each cabin of the plane. It could be argued that

none of these relates to prices or routes and thus none is preempted.

20

By contrast, the Fourth Circuit had little difficulty

concluding that, under the principles set forth in Hodges and

Travel All Over the World, boarding practices are a “service”

under the ADA, and a claim based on refusing to allow a

passenger to board due to a ticket agent’s failure to check for

photo identification is preempted. See Smith, 134 F.3d at 259;

see also Hodges, 44 F.3d at 336 (defining “services” to include

“boarding practices” and reaffirming Fifth Circuit precedent

that such claims are preempted).

Other examples, involving state regulation of policies

ranging from food and beverage service to baggage handling to

flight security, could easily be elaborated. In each case, the

split among the circuits means that very different rules will

apply in different places.

The bottom line point is that the nation’s leading air

carriers serve cities and passengers in every state, every day. It

is intolerable that these carriers should simultaneously be

subject to such divergent interpretations of controlling federal

law — particularly when one of those interpretations undermines

the very freedom of competition that Congress sought to

preserve, Airlines should not have to tailor their operations to

comply with the most restrictive state law rules that might be

applied to a given flight. As Judge Easterbrook succinctly put

it, “applying the conflicting tort principles of 50 different states

to the[] interstate and international transactions [of air carriers]

would make a mess of things. Preemption under § 105(a)(1)

enables a system of private law, with nationally uniform

overrides, to flourish.” Mesa Airlines, 219 F.3d at 611.

-_--

21

Il. The Ninth Circuit’s Rules Arc Particularly Problematic

Because They Expose Airlines to Forms of State

Regulation Congress Clearly Intended to Preempt.

In addition to the need to resolve the conflict among the

circuits, the need for review in this Court is especially

pronounced because the Ninth Circuit’s approach is clearly

wrong. First, as a textual matter, the Ninth Circuit’s

interpretation of the word “service” reads that word out of the

ADA altogether. It is a “cardinal rule of statutory interpretation

that no provision should be construed to be entirely redundant.”

Kungys v. United States, 485 U.S. 759, 778 (1988) (plurality

opinion of Scalia, J.). See also Exxon Corp. v. Hunt, 475 U.S.

355, 369 n.14 (1986) (rejecting reading of statute that would

render word superfluous). Nevertheless, the Ninth Circuit has

adopted a definition of the word “service” that renders -it

entirely redundant of the immediately preceding word “route.”

Pet. App. 5a (“‘service,” when juxtaposed to ‘rates’ and

‘routes,’ refers to such things as the frequency and scheduling -

of transportation, and to the selection ef markets to or from

which transportation is provided . . . .” (quoting Charas, 160

F.3d at 1265-66)).

Indeed, the Ninth Circuit explicitly refused to broaden its

definition of “service” to include an airline’s policies to provide

the many services and amenities that help to distinguish one

airline from another in the competitive marketplace. See Pet.

App. 5a-6a. Such policies undeniably affect the airlines’ ability

to compete both domestically and abroad. See 49 Fed. Reg.

— 25408, 25412 (June 20, 1984) (“While no-smoking restrictions

are important, the government should not impose restrictions on

airlines that hamper their growth or ability to compete.”)

(emphasis added). In the Ninth Circuit, however, if an airline’s

policies conflict with the policies of any given state, that state’s

22

laws and policies will control. That is flatly contrary to the

intent of Congress in enacting the ADA’s preemption

provision. As this Court has explained, the ADA’s preemption

provision “is most sensibly read, in light of the ADA’s

overarching deregulatory purpose, to mean ‘States may not seek

to impose their own public policies or theories of competition

or regulation on the operations of an air carrier.” Wolens, 513

U.S. at 229 n.5 (quoting and adopting brief of United States as

amicus curiae). But the ruling below endorses just such an

imposition. At least where, as here, such a policy has been

implemented to meet and hopefully surpass the competition, it

should be immune from state regulation. See id. at 226

(holding that state fraud claim would affect the “service” of

frequent flyer class upgrades); Morales, 504 U.S. at 378

(recognizing that ADA was designed to “promote maximum

reliance on competitive market forces’” (quoting 49 U.S.C.

App. § 1302(a)(4)).""

In adopting its restrictive interpretation of the term

“service,” the Ninth Circuit also ignored the contemporaneous

interpretation of that term by the Civil Aeronautics Board,

which explicitly included services not directly related to fares

or routes, such as “reservation and boarding practices,

insurance, smoking rules, meal service, entertainment .. .

minimum liability for loss, damages and delayed baggage, and

ancillary charges for headsets, alcoholic beverages,

'' This must be contrasted with state personal injury suits alleging the

negligent rendition of an airline's services by an errant employee. Such

suits deter only the employee's negligent conduct. They would not regulate

the airline by deterring it from having such a policy going forward and,

therefore, would not be preempted under the ADA. See, e.g., Hodges, 44

F.3d at 339-40; Woodson, 67 F. Supp. 2d at 557 (tort claim not preempted

where it would not force airline to alter a “practice,” “procedure” or

“service” related to boarding).

23

entertainment, and excess baggage.” 44 Fed. Reg. 9948, 9951

(Feb. 14, 1979) (emphasis added). That administrative

interpretation is entitled to judicial deference.

Perhaps most striking of all is the Ninth Circuit’s refusal to

allow preemption of any tort claim even if it would have the

indirect effect of forcing the airline to alter the routes it chooses

to fly. See Pet. App. 6a-7a. This unyielding interpretation is

patently inconsistent with this Court’s repeated emphasis that

state enforcement actions are preempted even if their effect on

an airline’s rates, routes or services is indirect. See Morales,

504 U.S. at 386.

In sum, although the particular airline policy at issue in this

tort case may have been foreclosed prospectively by new

federal smoking regulations, see supra, p. 3 n.1 there remains

an urgent need for action by this Court to clarify the law and

rectify the approach adopted by the Ninth Circuit. This case,

because it involves an airline policy not directly related to fares

or routes but unquestionably related to airline competition,

would be an excellent vehicle for addressing the multifaceted

circuit conflict. A resolution would also be very timely, in view

of the fact that the conflict has “matured” to the point where it

is intractable and is causing real practical problems for national

air Carriers attempting to determine which state laws apply to

them.

24

CONCLUSION

The writ of certiorari should be granted.

TOM TINKHAM

DORSEY & WHITNEY LLP

Pillsbury Center South

220 South Sixth Street

Minneapolis, MN 55402

(612) 340-2829

September 13, 2000

Respectfully submitted,

PAUL M. SMITH*

MICHAEL B. DeSANCTIS

JENNER & BLOCK

601 Thirteenth Street, N.W.

Washington, D.C. 20005

(202) 639-6000

DAVID P. SANDERS

JENNER & BLOCK

One IBM Plaza

Chicago, IL 60611

(312) 222-9350

Counsel for Petitioner

*Counsel of Record

APPENDIX

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APPENDIX A

United States Court of Appeals,

Ninth Circuit.

Julie DUNCAN, on behalf of herself and all others similarly

. situated,

Plaintiff-Appellant,

v.

NORTHWEST AIRLINES, INC.,

Defendant-Appellee.

No. 98-35617.

Argued and Submitted Dec. 7, 1999

Filed April 6, 2000

Before: REAVLEY,' REINHARDT, and McKEOWN,

Circuit Judges.

REINHARDT, Circuit Judge:

In this case, we must determine whether a class-action tort

suit brought against Northwest Airlines by some of its flight

attendants is preempted by the Airline Deregulation Act. We

hold that it is not

I. BACKGROUND

Julie Duncan, as the named plaintiff, filed a class-action,

personal-injury lawsuit against Northwest Airlines in

Washington state court. Brought on behalf of nonsmoking

flight attendants who served as crew members on Northwest's

smoking flights to and from Asia, the suit raises a claim based

' The Honorable Thomas M. Reavley, Senior United States Circuit

Judge for the United States Court of Appeals, Fifth Circuit, sitting by

ra a

2a

on Northwest's smoking policy. At the time the action was

filed, Northwest prohibited smoking on all domestic and most

international flights, but permitted smoking on most flights to

and from Asia.’ In her complaint, Duncan argued that, by

permitting smoking on most trans-Pacific flights, Northwest

breached its duty under state law to provide a safe and healthy

work environment for its employees. She further alleged that

Northwest’s decision to allow smoking on these flights injured

the flight attendants by exposing them to secondhand smoke.

The complaint sought damages, an injunction, and’ medical

monitoring.’

Northwest reinoved the suit to federal court and filed a

motion to dismiss, asserting that Duncan’s action was

preempted by § 1305(a)(1)_the Airline Deregulation Act

(ADA). The district court granted Northwest’s motion and

dismissed the case. Duncan appealed. After the appeal was

filed, Northwest banned smoking on all trans-Pacific flights.

> Prior to 1988, nearly every airline permitted smoking on both

domestic and international flights. Smoking policies began to change in

1988, when a federal statute banned smoking on some domestic flights.

Since then, a combination of statutory prohibitions, international

agreements, and voluntary efforts by airlines have made nonsmoking

domestic and international flights the rule rather than the exception.

‘Both Duncan and Northwest agree that Duncan abandoned her claim

for injunctive relief before the district court. In any event, her request for

injunctive relief would now be moot, given that Northwest no longer permits

smoking on its trans-Pacific flights.

— ee

~

PO A ORAM be

3a

Il. DISCUSSION

On appeal, we must determine whether Duncan’s tort suit

is preempted by § 1305(a)(1) of the ADA. Section 1305(a)(1)

provides:

[N]o state or political subdivision thereof and no interstate

agency or other political agency of two or more states shall

enact or enforce any law, rule, regulation, standard, or

other provision having the force and effect of law relating -

to the rates, routes or service of any air carrier... *

49 U.S.C. app. § 1305(a)(1) (emphasis added). The scope of

preemption under this provision depends on the interpretation

of the phrase “relating to the rates, routes or service.” When

the district court dismissed Duncan’s suit, the meaning of this

phrase--and hence the scope of preemption under section

1305(a)(1)--was uncertain both in this circuit and others.

»

* In 1994, section 1305(a)(1) of the ADA was amended and

incorporated into the Federal Aviation Administration Authorization Act of

1994. See 49 U.S.C. § 41713(b\(1). As amended, the provision reads in

relevant part: “[A] State, political subdivision of a State, or political

authority of at least 2 States may not enact or enforce a law, regulation, or

other provision having the force and effect of law related to a price, route,

or service of an air carrier that may provide air transportation under this

~ subpart.” Because the minor amendments are nonsubstantive, for

convenience we will continue to refer to the provision as § 1305(a)(1) of the

ADA. wpa rg

* Obviously, an action is preempted only if it also satisfies the other

requirements of § 1305(a)(1). For purposes of the present appeal, we

assume that a court ruling that granted relief in Duncan's suit would

constitute the enforcement by Washington of “a law, regulation, or other

provision having the force and effect of law.” 49 U.S.C. app. § 1305S(a)(1).

da

While Duncan’s appeal was pending, we substantially

clarified the scope of § 1305(a)(1) preemption in Charas y.

Trans World Airlines, Inc., 160 F.3d 1259 (9th Cir. 1998) (en

banc).° In that case, we provided a definitive interpretation of

the term “service”: we concluded that “Congress used the word

‘service’ in the phrase ‘rates, routes, or service’ in the ADA’s

preemption clause to refer to the prices, schedules, origins and

destinations of the point-to-point transportation of passengers,

cargo, or mail.” /d. at 1261. This interpretation was mandated

by the purpose and language of the preemption provision.

First, we determined that “in enacting the ADA, Congress

intended to preempt only state laws and lawsuits that would

adversely affect the economic deregulation of the airlines and

the forces of competition within the airline industry. Congress

did not intend to preempt passengers’ run-of-the-mill personal

injury claims.”* Jd. Accordingly, we interpreted the term

° For a detailed description of the evolution of ADA preemption

doctrine in this circuit, see Charas, 160 F.3d at 1262-63.

’ We also expressly overruled our earlier decisions in Harris v.

American Airlines, Inc., 55 F.3d 1472 (9th Cir. 1995), and Gee v. Southwest

Airlines, 110 F.3d 1400 (9th Cir. 1997), to the extent that those decisions

were inconsistent with our new decision.

* One might argue that, because the quoted passage mentions only

passengers ‘personal injury claims, Charas is inapplicable to personal injury

claims brought by others, such as flight attendants. However, we stated that

passengers ' claims were not preempted because the claims before us were

all filed by passengers. The logic of Charas does not support a distinction

between passenger plaintiffs and other plaintiffs. The opinion turns on the

effect of a lawsuit on certain aspects of the defendant airlines’ business, not

on the role of the plaintiff who brought the lawsuit. Moreover, any such

argument is rebutted by the fact that, in its conclusion, Charas holds that

“(Congress] did not intend to immunize the airlines from liability for

personal injuries caused by their tortious conduct.” 160 F.3d at 1266.

Nothing in this statement suggests that we intended the holding in Charas

se

Sa

“service” narrowly in order to prevent the “preemption of

virtually everything an airline does.” /d. at 1266. Second, our

interpretation of the term “service” was guided by the context

in which the term was used:

Airlines’ “rates” and “routes” generally refer to the

point-to-point transport of passengers. “Rates” indicates

price; “routes” refers to courses of travel. It therefore

follows that “service,” when juxtaposed to “rates” and

“routes,” refers to such things as the frequency and

scheduling of transportation, and to the selection of

markets to or from which transportation is provided...

[Thus,] [I]ike “rates” and “routes,” Congress used

“service” in § 1305(a)(1) in the public utility sense--i.e.,

[to refer to] the provision of air transportation to and from

various markets at various times.

Id. at 1265-66. We concluded that, “[{i}]n the context in which

it was used in the Act, ‘service’ was not intended to include an

airline’s provision of in-flight beverages, personal assistance to

passengers, the handling of luggage, and similar amenities.” /d.

at 1261.

Given our holding in Charas, it is clear that allowing

smoking on Northwest’s trans-Pacific flights does not

constitute a “service.” An airline’s decision to permit (or not

to permit) smoking on a flight is not a decision dealing with

“the frequency and scheduling of transportation, [or] the

selection of markets to or from which transportation is

provided.” Charas, 160 F.3d at 1265-66. Rather, like the

to be limited to suits brought by passengers.

6a

decision to offer in-flight beverages, a rule permitting or

prohibiting smoking deals with what we termed, for want of a

better word, “amenities.” Northwest contends that, even if

permitting smoking does not itself constitute a service,

Duncan’s action is still preempted by § 1305(a)(1) because tt

“relates to” a “service.” The airline’s argument proceeds in two

parts. First, it contends that the result of permitting Duncan's

lawsuit to proceed might be to force Northwest to prohibit

smoking on any trans-Pacific flights that originate in

Washington State. It argues that this forced prohibition, in

turn, might compel Northwest, for economic reasons, to drop

its trans-Pacific departures from Washington and reroute its

other trans-Pacific flights around the state. The airline argues

that this causal relationship between Duncan’s tort suit and its

provision of “services” renders her claim “related to” a

“service.”

Northwest's argument about the causal connection

between its smoking policy and its ability to profit on the

trans-Pacific routes is unpersuasive. As noted above,

Northwest stopped allowing smoking on its trans-Pacific fli ghts

while Duncan’s appeal was pending. In spite of its smoking

prohibition, Northwest has not canceled its trans-Pacific flights.

Thus, the airline’s own business decision demonstrates

conclusively that, even if Duncan’s suit had forced it to prohibit

smoking on flights originating in Washington (and perhaps it

did), the airline would not have had to cancel its

Washington-based trans-Pacific departures and reroute its other

flights.

Moreover, the type of causal relationship to a “service”

alleged by Northwest is not sufficient to invoke preemption

under § 1305(a)(1). Ifit were, then, contrary to Charas, almost

all personal injury claims would be preempted. This is because

7a

all successful tort suits--and certainly all successful class-action

tort suits--invariably carry with them an economic cost for the

defendant airline. Such cases may even, in some instances,

cause the airline to decide to make changes in its operations.

Charas makes clear, however, that the imposition of liability as

a result of a personal injury action does not sufficiently

interfere with the objectives of airline deregulation to warrant

preemption of the action--in other words, the connection

between an award in a iort case and an airline’s “services” is

simply too tenuous. See 160 F.3d at 1261, 1266; see also

Newman v. American Airlines, 176 F.3d 1128, 1131 (9th Cir.

1999). Cf Morales v. Trans World Airlines, 504 U.S. 374,

378, 112 S. Ct. 2031, 119 L. Ed.2d 157 (1992) (holding that

state actions are not preempted if they affect rates, routes, or

services “in too tenuous, remote, or peripheral a manner”

(internal quotation omitted)).

Finally, Northwest argues that Read-Rite Corp. y.

Burlington Air Express, 186 F.3d 1190 (9th Cir.1999),

somehow compels a different result. Read-Rite, however,

provides no support for Northwest’s position. Read- Rite

concerned the law governing the loss of or damage to goods

transported by interstate common carriers. In that case, we held

that “state law regulating the scope of air carrier liability for

loss or damage to cargo is preempted by the ADA.” /d. at 1197.

The crux of our holding was that claims arising from damage

by common carriers had been governed by a purely federal

regime for nearly the entire century. We described that regime

as follows: “federal regulation by statute, federal preemption

of state regulation, and regulation by federal common law of

matters not covered by federal statute.” /d. at 1196. Unlike

personal injury claims, which state tort law has traditionally

governed, federal law governed the claims at issue in Read-Rite

prior to the enactment of the ADA. Consequently, Read-Rite’s

8a

finding of preemption after the ADA’s enactment simply

maintained the regulatory status quo ante. Because it did not

address the question of when preemption within a field that the

states have traditionally occupied is appropriate--the question

at issue in both Charas and the present case--Read-Rite is of no

relevance here.

Ill. CONCLUSION

For the foregoing reasons, we reverse the district court's

conclusion that Duncan’s suit is preempted by § 1305(a)(1) of

the ADA, hold that the provision does not preempt Duncan's

action, and remand for further proceedings consistent with this

opinion.

REVERSED and REMANDED.

9a

APPENDIX B

UNITED STATES DISTRIC f COURT

WESTERN DISTRICT OF WASHINGTON

AT SEATTLE

JULIE DUNCAN, on behalf of

herself and all others similarly No. C98-130Z

situated,

Plaintiff, ORDER

VS.

NORTHWEST AIRLINES, INC., Filed

Defendant. June 5, 1998

Julie Duncan, a flight attendant for Northwest, alleges

negligence under Washington state law based on Northwest's

policy permitting smoking on its Transpacific flights. Duncan

seeks: 1) to enjoin passengers from continuing to smoke on

those flights; 2) to recover damages resulting from exposure to

secondhand smoke on those flights; and 3) to establish a fund

for medical monitoring flight attendants who worked the Asia

flights. Northwest Airlines moves to dismiss Duncan’s

complaint on grounds that it is preempted by the Airline

Deregulation Act (*ADA”), 49 U.S.C. § 41713 (b) (1994). The

Court grants Northwest’s motion.

I. DISCUSSION

Although it has banned smoking at its corporate

headquarters and on its domestic and trans-Atlantic flights,

Northwest Airlines continues to allow smoking in designated

10a

areas on most Of its flights to and from Asia and within Asia.

Julie Duncan is a flight attendant for Northwest and has worked

on the Asian flights where smoking is allowed. Ms. Duncan,

on behalf of herself and all similarly situated flight attendants,

claims that Northwest owes a duty to its employees to provide

a safe work environment, including an environment free of

harmful tobacco smoke and that Northwest’s refusal to ban

smoking is a breach of this common law duty. Northwest

argues that Duncan’s claim under Washington law is preempted

by § 105 of the Airline Deregulation Act.

Section 105 of the ADA provides that:

[A] State, political subdivision of a State, or political

authority of at least 2 States may not enact or enforce a

law, regulation, or other provision having the force and

effect of law, related to a price, route, or service of an air

carrier that may provide air transportation under this

subpart.

49 U.S.C. § 41713 (b)(1) (1994).

There are two questions at the heart of whether § 105

preempts Duncan’s state law claims. The first question is

whether application of the state’s common law of negligence

constitutes the enactment or enforcement of “a law, regulation,

or other provision having the force and effect of law.” 49

U.S.C. § 41713 (b\(1). The second question is whether the

claim “relates to rates, routes or service” or merely involves the

regulation of operation or maintenance of the aircraft. Ninth

Circuit precedent makes clear that assertions of preemption rise

or fall upon these determinations and both Duncan and

Northwest acknowledge that these are fundamental in

determining the pending motion.

lla

A. Enforcement or Enactment of a Law, Regulation or

Provision Having the Force of Law

The Supreme Court has recognized that the preemptive

scope of § 105 extends well beyond state statutes directly

targeted at the airline industry. See American Airlines v.

Wolens, 513 US. 219, 222-23 (1995). In Wolens, the Court

held that, although plaintiffs’ cause of action for breach of

contract was not preempted by § 105, a claim under IIlinois’s

generally applicable Consumer Fraud Act was preempted.

According to Duncan, Wolens, proves that Congress “did not

intend to occupy the field of airplane safety to the exclusion of

state common law.” Cleveland vy. Piper Aircraft Corp., 985

F.2d 1438, 1442 (10th Cir. 1993). But the Supreme Court's

reason for allowing the breach of contract suit to go forward

under state law does not support allowing Duncan’s negligence

suit to go forward. The Supreme Court was careful to note the

“distinction between what the State dictates [by way of

substantive tort standards, for example] and what the airline

itself undertakes” through the terms of its contract. Wolens,

513 U.*,. at 233. The Court then reasoned that the very terms

of the contract “confine[] the courts, in breach of contract

actions, to the parties’ bargain, with no enlargement or

enhancement based on state laws or policies external to the

agreement.” /d.

Likewise, Washington state’s common law duty to provide

employees with a sufficiently smoke-free work environment,

McCarthy v. Dept. of Social & Health Servs., 110 Wn. 2d 812

(1988), does more than “simply give effect to bargains offered

by the airlines and accepted by airline customers.” HWolens, 513

U.S. at 233. It would impose a state-created affirmative duty

upon Northwest to alter its own smoking policies on its

l2a

international flights. Such a state-imposed duty interferes with

the purpose behind ADA preemption, which is to “encourage,

develop, and attain an air transportation system which relies on

competitive market forces to determine the quality, variety and

prices of air services.” H.R. Cong. Rep. No. 95-1779, 95th

Cong. (1978); see ADA, 49 U.S.C. § 1302(a)(4), (a9) (1990).

The Ninth Circuit has recognized that claims founded on

state common law of negligence fall within the preemptive

scope of the ADA. See Gee v. Southwest Airlines, 110 F.3d

1400, 1404 (9th Cir. 1997); Harris v. American Airlines, 55

F.3d 1472, 1476 (9th Cir. 1995). Although it was not discussed

expressly, the Ninth Circuit in Gee and Harris necessarily

concluded that to ho!d an airline liable under state common law

of negligence would be to “enforce a law, regulation, or other

provision having the force and effect of law” when it held

certain negligence claims to be preempted. See Gee, 110 F.3d

at 1404: Harris, 55 F.3d at 1476. Duncan's claim for

negligence under Washington state law, therefore, is exactly the

type of action that tnggers § 105's preemption.

B. “Service” or Operation and Maintenance

The more difficult inquiry is whether Northwest’s smoking

policy constitutes a competitive “service” for the purpose of §

105 preemption. The Ninth Circuit has found a relatively broad

range of common law tort claims to be sufficiently linked to an

airline's services so as to preempt the claims. See Gee, 110

F.3d at 1404 (negligence claim based on providing passengers

with too many drinks and failing to provide assistance to

disabled passenger are preempted); Harris, 55 F.3d at 1476-77

(negligence claim based on failure to control unruly passenger

preempted).

13a

In Harris, the Ninth Circuit held a woman’s state law

negligence claim based upon a flight attendants continuing to

serve an intoxicated passenger who was harassing her was

preempted by the ADA. The court concluded that Harris’

claims “pertain|ed] directly to a ‘service’ the airlines render;

the provision of drink.” /d. at 1476. The Ninth Circuit relied

in large part upon the Supreme Court's expansive reading of

the ADA’s preemptive power in Morales v. Trans World

Airlines, Inc., 504 U.S. 374 (1992). In Morales, the Supreme

Court held that the preemptive scope of the ADA’s “relating to

rates, routes, or service” language to the preemptive provision

in ERISA, 29 U.S.C. § 1144(a), which preempts all state laws

“insofar as they . . . relate to any employee benefit plan.” /d. at

383. Having found such a broad preemptive purpose, the Court

held that any “State enforcement actions having a connection

with or reference to airline ‘rates, routes, or services’ are

preempted.” /d. Although Harris remains intact, the Ninth

Circuit has since backed away from such a broad interpretation

of the ADA’s preemptive scope. See Gee, 110 F.3d at 1404-05.

In Gee, the Ninth Circuit held that claims of emotional distress

based on a flight attendant’s failure to stop serving alcohol to

an intoxicated passenger and claims arising out of a flight

attendant’s failure to assist a disabled passenger were

sufficiently related to service to be preempted under the ADA.

Id. at 1406. Claims arising from an injury suffered when a

flight attendant failed to secure the latch on a drink cart’s door,

however, were found to be related to the operation or

maintenance of the plane rather than to services and were not

preempted. /d. at 1407. Likewise, a claim for injuries suffered

when an item fell from the overhead bin were not sufficiently

related to services to be preempted. /d.

Gee recognized the importance of considering the ADA’s

goals of airline deregulation as they relate to specific claims in

l4a

determining the scope of preemption. /d. at 1404 (citing West

y. Northwest Airlines, Inc., 995 F.2d 148 (9th Cir. 1993). The

court in Gee recognized that post-Harris decisions of the

Supreme Court had indicated both that the scope of preemption

under the ADA’s “relates to rates, routes, and service” language

may not be so broad. /d. at 1405 (citing New York State Conf.

of Blue Cross & Blue Shield v. Travelers Ins. Co., 514 U.S. 645

(1995)).

In Travelers, the Supreme Court adopted an approach to

preemption contrary to what the Ninth Circuit did in Harris and

contrary to the approach that it had previously taken in

Morales. Travelers, 514 U.S. at 657. The Travelers Court

explained that the preemption analysis must start from the

“assumption that the historic police powers of the States were

not to be superseded by the Federal Act unless that was the

clear manifest purpose of Congress.” /d. at 655. Such a

presumption against preemption runs contrary to Harris, where

the Ninth Circuit established a presumption that all claims

related to services were preempted, from which the court would

later carve exceptions such as breach of contract claims. See

Harris, 55 F.3d at 1477. Moreover, to the extent that Harris

relied upon Morales’ broad, ERISA-based interpretation of the

scope of preemption, Travelers altered the yardstick of

preemption in the ERISA context. The Supreme Court noted

that if the phrase “relate to” is extended to “its furthest reach of

indeterminacy, then for all practical purposes preemption

would never run its course.” Travelers, 514 U.S. at 655.

The Supreme Court’s “backtracking” from Morales and the

Ninth Circuit’s subsequent criticism of its own reasoning in

Harris does not alter the result in this case. This court need not

rely upon Harris to its fullest extent in finding that Duncan’s

claims are preempted. Northwest’s smoking policy does not

lSa

relate to a service in an indeterminate way. The Civil

Aeronautics Board, when implementing the ADA’s preemption

provision, recognized expressly that smoking policies were

within the preemptive scope of § 105.44 Fed. Reg. 9948, 9951

(1979). The Board explained that § 105 precludes states from

interfering “with the services that carriers offer in exchange for

their rates and fares. For example, liquidated damages for

bumping (denial of boarding), segregation of smoking

passengers, minimum liability for loss, . . . alcoholic beverages,

entertainment, and excess baggage would clearly be ‘service’

regulation within the meaning of section 105.” 44 Fed. Reg.

9948, 9951 (1979). The Board provided even more directly

implicated claims such as Duncan’s in its conclusion of what

is preempted by § 105: “Accordingly, we conclude that

preemption extends to all of the economic factors that go into

the provision of the quid pro quo for passenger’s fare, including

. smoking-rules.” /d. Likewise, in Diefenthal v. Civil

Aeronautics Board, 68 F.2d 1039, the court held that the

regulation of smoking was authorized under the Airline

Deregulation Act as related to the kind or quality of service

which a carrier provides. /d. at 1044.

The Civil Aeronautics Board regulations and the Ninth

Circuit’s holdings in Harris and Gee indicate that Northwest

Airlines’ policy of allowing smoking on its trans-Pacific routes

is a function of its service for the purposes of § 105 of the

ADA. Although Washington state has an interest in assuring

safety in Ms. Duncan’s workplace, the ADA makes clear that

this interest must yield to the federal interest in “encourag{ ing],

develop[ing], and attain{ingj an air transportation system which

relies on competitive market forces to determine the quality,

variety, and prices of air services.” H.R. Cong. Rep. No. 95-

1779, 95th Cong. (1978). Providing customers with the option

to smoke in designated areas of the plane is regrettably a part

l6a

of the “quid pro quo” for some passengers’ fare. 44 Fed. Reg.

at 9951. And to the extent that Northwest must maintain

smoking sections on its Trans-Pacific flights in order to

compete with Asian carriers, this service is one of the

competitive market forces” upon which Northwest relies.

Duncan attempts to escape preemption by characterizing the

cause of her injuries as “Northwest's failure to properly operate

and maintain the aircraft by allowing the cabin to fill with toxic

fumes.” Duncan claims that, as in Gee, the “claim does not

relate to airline ‘service’ but rather is connected with the failure

to take appropriate safety measures relating to the operation of

the aircraft” Gee, 110 F.3d at 1407. However, Duncan does not

point to any instrumentality or mechanical element of the

airplane that malfunctioned or was improperly operated by the

crew. In Gee, .ne claims that were not preempted all involved

the crew’s improper operation of the aircraft. Those claims

that were part of the bargained-for service provided to

passengers were not preempted. Because Northwest’s smoking

policies are part of the competitive package that the airline

offers in its quid pro quo with passengers, claims arising from

those policies are preempted.

- The Fifth Circuit cases of Smith v. America West Airlines.

Inc., 44 F.3d 344, 346-47 (Sth Cir. 1995) and Hodges v. Delta

Airlines. Inc., 44 F.3d 334, 338 (Sth Cir. 1995) are harmonious

with Ninth Circuit distinction between service and operations

and maintenance, and do not require a different result Gee, 110

F.3d at 1407. In Smith, the court was confronted with a state

law personal injury claim based on the airline’s permitting a

visibly deranged man to board the plane. The court relied

heavily upon the purpose of the Airline Deregulation Act in

determining the scope of preemption. The court noted that

§ 150 “assured the economic deregulation of the airlines by

17a

rendering them immune from rate and service regulation by the

states after the demise of federal regulation. Neither the

language nor history of the ADA implies that Congress was

attempting to displace state personal injury tort law concerning

the safety of the airline business.” The court concluded that, if

they had ultimately recovered, the Smiths’ claim “could affect

the airline’s 1icket selling, training or security procedures, but

it would not regulate the economic or contractual aspects of

boarding [the plane]. Any such effect would be ‘too tenuous,

remote or peripheral’ to be preempted by §1305(a)(1).”” Smith,

44 F.3d at 347 (quoting Shaw v. Delta Air Lines. Inc., 463 US.

85, 100 n. 21(1983)). The court in Smith did preempt claims

for the negligent rendition of service by an air carrier. /d.

After noting that the real question is the scope of services that

$105 was intended to reach, the court concluded that “those

services include boarding practices and their economic and

contractual dimension but not insofar as the safety of the flight

is involved.” /d.

In conclusion, the Court concludes that the Northwest

smoking ban relates to services that require preemption under

the Airline Deregulations Act. Accordingly, the Court

GRANTS the motion to dismiss and directs the Clerk to enter

final judgment pursuant to this Order.

IT IS SO ORDERED.

DATED this 5" day of June, 1998.

THOMAS S§S. ZILLY

UNITED STATES DISTRICT JUDGE

18a

UNITED STATES DISTRICT COURT

Western District of Washington

JUDGEMENT IN A CIVIL CASE

JULIE DUNCAN

V. CASE NUMBER C98-130Z

NORTHWEST AIRLINES, INC.

QO Jury Verdict. This action came before the Court for a

trial by jury. The issues have been tried and the jury has

rendered its verdict.

® Decision by Court. This action came to trial or hearing

before the Court. The issues have been tried or heard and

a decision has been rendered.

IT IS ORDERED AND ADJUDGED THAT

The Court GRANTS the defense motion to dismiss.

Judgment is hereby entered in favor of the defendant with

costs and with prejudice.

BRUCE RIFKIN, Clerk

June 11, 1998 By _/s/Casey Condon

Date Casey Condon

Deputy Clerk

7 19a

APPENDIX C

NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

JULIE DUNCAN, on behalf of No. 98-35617

herself and all others similarly

situated, D.C. No.

Plaintiff-Appellant, CV-98-00130-TSZ

V. : ORDER

NORTHWEST AIRLINES, INC., | Filed

Defendant-Appellee. June 16, 2000

Before: REAVLEY,' REINHARDT, McKEOWN,

Circuit Judges

The panel has voted to deny the petition for rehearing.

Judges Reinhardt and McKeown voted to deny the petition for

rehearing en banc, and Judge Reavley so recommended.

The full court has been advised of the petition for rehearing

en banc and no judge has requested a vote on whether to rehear

the matter en banc. Fed. R. App. P. 35.

The petition for rehearing and the petition for rehearing en

banc are denied.

' The Honorable Thomas M. Reavley, Senior United States Circuit Judge for

the United States Court of Appeals, Fifth Circuit, sitting by designation.

20a

APPENDIX D

FROM TITLE 49. TRANSPORTATION

SUBTITLE VII--AVIATION PROGRAMS

PART A--AIR COMMERCE AND SAFETY

SUBPAPT II--ECONOMIC REGULATION

CHAPTER 417--OPERATIONS OF CARRIERS

SUBCHAPTER I--REQUIREMENTS

§ 41713. Preemption of authority over prices, routes, and

service

(a) Definition.--In this section, “State” means a State, the

District of Columbia, and a territory or possession of the United

States.

(b) Preemption.--(1) Except as provided in this subsection, a

State, political subdivision of a State, or political authority of

at least 2 States may not enact or enforce a law, regulation, or

other provision having the force and effect of law related to a

price, route, or service of an air carrier that may provide air

transportation under this subpart.

(2) Paragraphs (1) and (4) of this subsection do not apply to air

transportation provided entirely in Alaska unless the

transportation is air transportation (except charter air

transportation) provided under a certificate issued under section

41102 of this title.

(3) This subsection does not limit a State, political subdivision

of a State, or political authority of at least 2 States that owns or

operates an airport served by an air carrier holding a certificate

issued by the Secretary of Transportation from carrying out its

proprietary powers and rights.

2la

(4) Transportation by air carrier or carrier affiliated with a

direct air carrier.--

(A) General rule.--Except as provided in subparagraph (B), a

State, political subdivision of a State, or political authority of

2 or more States may not enact or enforce a law, regulation, or

other provision having the force and effect of law related to a

price, route, or service of an air carrier or carrier affiliated with

a direct air carrier through common controlling ownership

when such carrier is transporting property by aircraft or by

motor vehicle (whether or not such property has had or will

have a prior or subsequent air movement).

(B) Matters not covered.--Subparagraph (A)--

(1) shall not restrict the safety regulatory authority of a State

with respect to motor vehicles, the authority of a State to

impose highway route controls or limitations based on the size

or weight of the motor vehicle or the hazardous nature of the

cargo, or the authority of a State to regulate motor carriers with

regard to minimum amounts of financial responsibility relating

to insurance requirements and self-insurance authorization;

and

(11) does not apply to the transportation of household goods,

as defined in section 13102 of this title.

(C) Applicability of paragraph (1).--This paragraph shall not

limit the applicability of paragraph (1).

22a

APPENDIX E

SUPERIOR COURT OF WASHINGTON IN AND FOR

KING COUNTY

JULIE DUNCAN, on behalf of

herself and all others similarly

No. 98-2-01158-

situated, ISEA

V.

Plaintiff, Class Action

Complaint for

Injunctive Relief,

Medical Monitoring

NORTHWEST AIRLINES, INC., | and Damages

Defendant.

Plaintiff Julie Duncan alleges, upon personal knowledge and

belief as to her own act and upon information and belief based

on investigation of counsel as to all other matters, as follows:

35.

** * *

Northwest’s reason for allowing smoking, especially on

flights to and from Japan, is its profit motivation.

Northwest’s decision is based on feedback from key

corporate accounts who have indicated that allowing

smoking on certain routes is essential to retaining their

business.

** * *

Northwest’s reason for maintaining “smoking” flights

especially between the United States and Japan is a result

of a corporate decision to favor the desire to key corporate

23a

accounts over the health of its employees. In other words,

profit is more important than the health of Northwest's

flight crew members, who are continually subjected to

smoke-filled cabins on long flights over the Pacific.

* * * *