Plaintiff avoids preemptive effect of Montreal Convention by court’s holding that claims are for non-performance, not delay

Mullaney v. Delta Air Lines, Inc. (S.D.N.Y. June 3, 2009).  According to the plaintiff, Delta canceled his return flight from Paris to New York due to a strike by employees of Air France (Delta’s codeshare partner) and breached its written promise to reimburse customers who booked substitute flights on other airlines.  In his class action complaint, the plaintiff sought the refund of his unused Paris-New York ticket, the expenses he incurred during the extra days he spent in Paris waiting for a flight to New York, attorneys’ fees and punitive damages.  The complaint set forth causes of action for violation of New York’s consumer protection statute, promissory estoppel and unjust enrichment.

Delta moved to dismiss on the grounds that the Montreal Convention preempts the complaint’s state law causes of action.  The airline characterized the plaintiff’s claims as delay claims, and argued that, as such, they are preempted because Article 19 of the Convention provides that an airline is liable for “damage occasioned by delay in the carriage by air of passengers, baggage or cargo.”

The court sided with the plaintiff, holding that his claims are not preempted because they are not for delay but for non-performance of the airline’s carriage obligation.  The court reasoned that the claims are for non-performance because the plaintiff had tried, without success, to obtain alternative transportation on another Delta flight and that, despite his efforts, the airline was unable to transport him.

In the typical case in which a court holds that a plaintiff’s claims are for delay rather than non-performance, the plaintiff impatiently obtained alternative transportation on a different airline’s flight without waiting to find out whether the defendant airline would be able to transport him.  Here, according to the court, the plaintiff waited three days beyond his scheduled departure date, during which time Delta was unable to transport him, before he departed on a different airline’s flight.  The court noted that, even on the day the plaintiff departed, Delta could not have transported him due to the ongoing strike.

Update:  On July 29, 2009, the court denied the plaintiff’s motion for class certification.  The court held that, because individualized proof would be required to establish the airline’s liability for fraud, the plaintiff, who the court described as “a lawyer who obviously does not have enough client work to keep him busy,” had failed to meet the requirement that the proposed class members’ common questions be susceptible to generalized rather than individualized proof.  In support of its ruling, the court also noted that the plaintiff’s claims might differ from those of the other members of the proposed class because the plaintiff is subject to the “particular defense” that he failed to comply with Delta’s procedure for obtaining a refund.  That procedure, which is set forth in Delta’s Conditions of Carriage, required that the plaintiff turn in the unused portion of his ticket before its expiration, i.e., within one year from the date of travel from the point of origin.

Passenger’s second visit to Fifth Circuit yields additional baggage damages but no attorneys’ fees

Muoneke v. Compagnie Nationale Air France (5th Cir. Tex. May 12, 2009).  In 2004, the passenger traveled from Texas to Nigeria on Air France’s flights.  During a change of aircraft in Paris, Air France personnel required that the passenger check the baggage she had carried onto the prior flight.  The passenger claimed that when she arrived in Nigeria, cash and a camera were missing from her baggage.

The passenger sued Air France in a Texas state court.  Air France removed the case and successfully moved for summary judgment.   As previously reported, the Fifth Circuit reversed and remanded the case in 2007 because a factual issue precluded summary judgment.

On remand, the district court determined that the passenger’s actual loss totaled $1,242 but that the Warsaw Convention limited her recovery to $134.  The passenger then applied for an award of attorneys’ fees and costs but the district court held that fees are not recoverable under the Warsaw Convention.

In its opinion, the Fifth Circuit held that because the Montreal Convention had entered into force on November 4, 2003 and the events at issue had taken place in 2004, the Montreal Convention, not the Warsaw Convention, applied to the case.

Next, the appeals court rejected Air France’s argument that it had no liability to the passenger because its contract of carriage disclaimed liability for cash and cameras (and other valuable items) in checked baggage.  The court reasoned that the contract of carriage provision was inconsistent with Article 17 of the Montreal Convention, which subjected the airline to strict liability for baggage loss and damage (up to Article 22(2)’s limit of 1,000 Special Drawing Rights (“SDR”) per passenger).

The Fifth Circuit then held that Air France’s liability was capped at $1,580 under Article 22(2) of the Montreal Convention, which limits an airline’s liability for baggage loss, damage or delay to 1,000 SDRs per passenger (one SDR was equivalent to $1.58 at the time of the district court trial).  The appeals court then reversed the district court’s judgment and entered judgment for the passenger for $1,242, the amount of actual damages that the district court had determined that she had incurred.

Finally, the Fifth Circuit held that the passenger was not entitled to an award of attorneys’ fees but was entitled to recover her costs.  The court reasoned that, although the Montreal Convention does not prohibit the recovery of fees or costs, it does not provide an independent basis on which a court may award such amounts.  As to fees, the court held that they were not recoverable because the passenger had not identified any independent basis, such as a federal or state statute, for a fee award.  As to costs, the court held that they were recoverable under Federal Rule of Civil Procedure 54(d) and remanded the case to the district court for the sole purpose of calculating such costs (remarking that “[i]t is long past time for this litigation over $1,242.79 to end”).

Note:  The Fifth Circuit’s holding that the airline was liable for the loss of the cash and camera even though its contract of carriage purported to disclaim liability for these items is consistent with the “Guidance on Airline Baggage Liability and Responsibilities of Code-Share Partners Involving International Itineraries” that DOT issued on March 26, 2009.  The Guidance (which the Fifth Circuit did not cite) states as follows:  “Although carriers may wish to have tariff terms that prohibit passengers from including certain items in checked baggage, once a carrier accepts checked baggage, whatever is contained in the checked baggage is protected, subject to the terms of the [Montreal] Convention, up to the limit of 1000 SDRs (Convention, Article 22, para. 2).”  See 74 Fed. Reg. 14837-38 (Apr. 1, 2009).

Court analyzes definition of “international carriage” under Montreal Convention

Jones v. USA 3000 Airlines (E.D. Mo. Feb. 9, 2009).  During a flight from St. Louis to Jamaica, a flight attendant allegedly pushed a service cart into the passenger’s knee, causing damage to the passenger’s “entire nervous system which had been severely shocked and deranged.”  The passenger filed a lawsuit against the airline in state court.

The airline removed the case to federal court on the grounds that the parties’ rights related to the incident were governed by the Montreal Convention, which completely preempted the passenger’s state law cause of action.  The passenger moved to remand the case, arguing that because Jamaica is not a signatory to the Convention, the flight at issue was not “international carriage” as defined by the Convention.  The passenger’s ticket was for round-trip transportation between St. Louis and Jamaica.

The Convention “applies to all international carriage of persons, baggage or cargo performed by aircraft for reward.”  Article 1(1).  Article 1(2) defines “international carriage” as follows:  “For the purposes of this Convention, the expression international carriage means any carriage in which, according to the agreement between the parties, the place of departure and the place of destination, whether or not there be a break in the carriage or a transhipment, are situated either within the territories of two States Parties, or within the territory of a single State Party if there is an agreed stopping place within the territory of another State, even if that State is not a State Party” (emphasis in original).

The court denied the passenger’s motion.  Citing numerous cases, the court concluded that, for round-trip international travel, “the place of destination” is the same as “the place of departure” and that it was irrelevant that the passenger’s outbound flight was to Jamaica, which is not a party to the Convention.  Thus, the court held that the Convention applied because the passenger’s “place of destination” was St. Louis, not Jamaica, and because the United States is a party to the Convention.  The court also held that the Convention completely preempted the passenger’s state law cause of action.

Note:  Where, as in the passenger’s memorandum in support of her remand motion, your only supporting precedent is a dissenting opinion in a 1977 case, you know your argument is a long shot.  Where the judge who wrote that dissenting opinion relied solely on Homer’s “The Odyssey” as support for his position, you really know your argument is a long shot.  It is not often that one sees a quote like this in an opinion:  “Even Ulysses, that most widely travelled of ancient heroes, was also most intent upon returning home.  Doubtless when he embarked from his home in Ithaca he always intended to return there once he had attended to his business in Troy.  But the fact that one intends to return home does not mean that that is where one is going when one sets out on a voyage.”

Update:  USA 3000 Airlines subsequently moved for summary judgment on the grounds that the passenger’s claims were time-barred under Article 35(1) of the Montreal Convention, which provides as follows:  “The right to damages shall be extinguished if an action is not brought within a period of two years, reckoned from the date of arrival at the destination, or from the date on which the aircraft ought to have arrived, or from the date on which the carriage stopped.”  Because the passenger had arrived at her destination in August 2005 but did not file the lawsuit until October 2008, the court granted the airline’s motion.

Court’s narrow view of Montreal Convention preemption results in remand to state court

Narkiewicz-Laine v. Scandinavian Airlines Systems (N.D. Ill. Sept. 12, 2008).  In his state court complaint, the passenger claimed that (i) the airline’s delay of a certain international flight in March 2008 caused him to miss his connecting flight, and (ii) the airline refused to refund his ticket for an international flight scheduled for June 2006, even though he had called on the day of departure to advise the airline that he was sick and thus unable to travel that day.

The airline removed the case to federal court, contending that the Montreal Convention provided, in Article 19, the exclusive cause of action for the passenger’s delay claim, thus preempting his state law breach of contract claim for delay and giving the court original jurisdiction over such claim, and that the court had supplemental jurisdiction over the passenger’s state law breach of contract refund claim.  The plaintiff moved to remand the case to state court.

The court sided with the passenger.  Citing a recent Seventh Circuit case, the court held that because the Montreal Convention’s conditions and limits, including Article 19, only operate as affirmative defenses to a passenger’s claims, such provisions do not provide a basis for federal question subject matter jurisdiction.  Accordingly, the court remanded the case to state court.

Note:  In making its ruling, the court acknowledged that in Knowlton v. American Airlines, Inc., which is discussed here, the Maryland federal district court took a much broader view of Montreal Convention preemption.

Court rules that it lacks subject matter jurisdiction in case against Spanish airline involving passenger in-flight death

Aikpitanhi v. Iberia Airlines of Spain (E.D. Mich. Mar. 31, 2008).  The plaintiffs’ son died during an Iberia flight from Spain to Nigeria in 2007 while being deported.  The plaintiffs sued Iberia, alleging that Spanish law enforcement agents, by their conduct before and during the flight, caused the death of their son and that airline personnel assisted the agents by covering him with a sack.  The plaintiffs are citizens and residents of Nigeria, as was their son.

Iberia moved to dismiss on the grounds that the court lacked subject matter jurisdiction under the Montreal Convention.  Pursuant to Article 33 of the Convention, a plaintiff may bring an action in a U.S. court under the Convention only when the U.S. is (i) “the domicile of the carrier,” (ii) the “principal place of business” of the carrier, (iii) the place where the carrier “has a place of business through which the contract has been made,” (iv) “the place of destination” or (v) the “principal and permanent residence” of a passenger.  (The fifth jurisdictional basis, which does not exist under the Warsaw Convention, is only available in cases involving the death or injury of a passenger.)

The plaintiffs argued that the court had subject matter jurisdiction under the first basis, “the domicile of the carrier,” because Iberia had been incorporated in Florida as a foreign corporation since 1966.  The court disagreed.  Relying on cases decided under the Warsaw Convention, the court held that Iberia’s “domicile” for purposes of the Montreal Convention is Spain, where the company is incorporated and has its headquarters.  The court sided with earlier cases in holding that, under the Warsaw and Montreal Conventions, an airline has only one “domicile.”

The court also rejected the plaintiffs’ argument that the court had subject matter jurisdiction under the Alien Tort Claims Act, 28 U.S.C. § 1350, holding that because the plaintiffs’ son died during an international flight, the Montreal Convention applied and provided the plaintiffs’ exclusive remedy.

Note:  The plaintiffs did not appeal the court’s ruling, which leads one to wonder whether they refiled this high-profile case in Nigeria or Spain.  If you have information on this matter, please email me at ksn@nvflyer.com and I will update this post.

Ninth Circuit again rejects passengers’ deep vein thrombosis arguments

Twardowski v. American Airlines, Inc. (9th Cir. (Cal.) July 30, 2008).  The passengers in these consolidated appeals alleged that they had suffered injuries from deep vein thrombosis (“DVT”) they had developed during flights for which they had bought tickets between 2001 and 2004.  They alleged that the airlines were liable for such injuries because the airlines had not warned the passengers of the risk of developing DVT, despite public statements that the International Air Transport Association (“IATA”), airline medical officers, and even the august English House of Lords, had made, before the flights at issue, suggesting that the airlines issue such warnings.

Before the trial court, the airlines had successfully moved for summary judgment under Article 17 of the Warsaw Convention, which applied to the flights at issue and thus provided the passengers’ exclusive remedy against the airlines.  Article 17 of the Convention governs an airline’s liability for a passenger’s death or bodily injury; it provides as follows:  “The carrier is 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.”  The U.S. Supreme Court has defined an “accident” under Article 17 as “an unexpected or unusual event or happening that is external to the passenger,” not “the passenger’s own internal reaction to the usual, normal, and expected operation of the aircraft.”

In separate prior decisions, the Ninth Circuit had held that developing DVT during a flight is not an “accident” within the meaning of Article 17, and that an airline’s failure to warn about the risk of DVT is not an “event” within the meaning of the foregoing Supreme Court definition of an “accident.”  In Twardowski, the passengers – reaching for what was almost certainly the last arrow in the DVT quiver – argued that the airlines’ failure to comply with the suggestions by IATA and others to warn passengers about DVT was an unexpected “event” and, thus, an “accident” within the meaning of Article 17.

The Ninth Circuit rejected the passengers’ arguments.  It reasoned that an airline’s failure to warn a passenger about DVT does not become an unexpected “event,” and thus an Article 17 “accident,” just because various groups and individuals have publicly suggested that the airline give such warnings.  The court drew a distinction between the general suggestions made to the airlines in this case and the specific requests for health-related assistance made by passengers to airlines in certain other cases in which the courts held that the airlines’ failure to comply with those requests constituted an unexpected “event.”

Passenger unable to break Montreal Convention baggage liability limit

Bassam v. American Airlines (5th Cir. (La.) July 14, 2008).  Four months after her international flight, American Airlines delivered the passenger’s missing baggage to her.  The passenger claimed that items were missing from the baggage, and she sued the airline in state court for over $5,000 for the value of the missing items.  The airline removed the case to federal court, where the passenger amended her complaint to add a claim for $15,000 for the “embarrassment and upset of not being able to dress and appear in public as was her prior practice.”

American moved for summary judgment on the grounds that (i) the passenger’s recovery for her baggage loss was limited to 1,000 Special Drawing Rights (approximately $1,540 at that time) under Article 22(2) of the Montreal Convention, and (ii) the passenger could not recover anything for her “embarrassment” claim because damages for emotional distress not caused by a physical injury are not recoverable under the Convention.

As to the liability limit issue, the passenger argued that the limit did not apply under Article 22(5) of the Convention; that provision removes the Article 22(2) limit “if it is proved that the damage resulted from an act or omission of the carrier, its servants or agents, done with intent to cause damage or recklessly and with knowledge that damage would probably result” and “it is also proved that such servant or agent was acting within the scope of its employment.”  The passenger contended that “[t]he four (4) month delay in recovery of the luggage, allowing [her] personal belongings to be ransacked and stolen, compounded with [American’s] refusal to take any meaningful steps to help [her] in an obvious time of need, makes [American’s] actions much more egregious, certainly rising to the level of what any impartial traveler would consider ‘willful misconduct’.”  In essence, the passenger argued that, by themselves, the delay in delivery and the losses she incurred eliminated any need for her to prove that the airline actually engaged in the type of conduct described in Article 22(5) that would result in the lifting of the liability limit set forth in Article 22(2).

The trial court rejected the passenger’s arguments and was affirmed by the Fifth Circuit.  On the liability limit issue, the appeals court held that, to break the limit under Article 22(5), a passenger must prove facts showing that airline personnel either (i) intended to cause damage, or (ii) acted recklessly with the subjective knowledge that damage would probably result from their conduct.  The Fifth Circuit held that the passenger had failed to meet this “heavy” burden by merely resting on the allegations in her pleadings regarding the delay in delivery of her baggage and the losses she incurred.  It also affirmed the trial court’s ruling with respect to the passenger’s emotional distress claim.

Note:  Before the trial court, the passenger had also argued that the Article 22(2) limit did not apply because she had not been notified of the limit before her flight.  She cited Article 3(4), which provides that “[t]he passenger shall be given written notice to the effect that where this Convention is applicable it governs and may limit the liability of carriers in respect of death or injury and for destruction or loss of, or damage to, baggage, and for delay.”  The trial court cited the plain language of Article 3(5) in rejecting her argument; that provision states that “[n]on-compliance with the provisions of the foregoing paragraphs shall not affect the existence or the validity of the contract of carriage, which shall, nonetheless, be subject to the rules of this Convention including those relating to limitation of liability.”  The passenger did not raise this issue on appeal.

Court rules on summary judgment motions in charter flights class action

In re Nigeria Charter Flights Contract Litigation (E.D.N.Y. Oct. 25, 2007).  In 2002, World Airways, Inc. and Ritetime Aviation and Travel Services, Inc. entered into a charter aircraft services agreement under which World agreed to supply Ritetime with round-trip flights between points in the U.S. and Lagos, Nigeria.  The charter flights began but, by the end of 2003, Ritetime owed World over $2 million, leading World to discontinue its U.S.-Nigeria operations.  World’s action stranded hundreds of passengers who had traveled on outbound flights and left others who had bought tickets for 2004 unable to travel at all.

After the passengers sued World, Ritetime and its CEO in courts throughout the U.S., the federal cases were consolidated in the Eastern District of New York, which certified a class of plaintiffs in 2006.  The plaintiffs alleged that World is liable under the Montreal Convention for its failure to transport them, and they also alleged state law claims for breach of contract, negligence and fraud.

World moved for summary judgment, contending that (i) the Montreal Convention preempts the plaintiffs’ state law claims, (ii) even if the plaintiffs’ state law contract claims are not preempted, they should be dismissed because there is no privity of contract between World and the plaintiffs, and (iii) even if the Convention does not preempt the plaintiffs’ negligence and fraud claims, the federal Airline Deregulation Act preempts those claims.  The plaintiffs filed a cross-motion for summary judgment.

The court granted World’s motion as to the plaintiffs’ delay claims under the Convention but denied it as to their breach of contract and tort claims.  The court also denied the plaintiffs’ cross-motion.  The court’s specific rulings are as follows.

Montreal Convention preemption.  Delay in international air transportation is governed by Article 19 of the Convention, and whenever the Convention applies, it preempts all state law claims for matters that fall within the scope of its application.  Article 22(1) limits an airline’s liability for a passenger’s delay claim to 4,150 Special Drawing Rights, or about $6,750.  The Convention does not govern nonperformance of a contract of carriage.  The court held that the Convention did not preempt the plaintiffs’ state law claims, ruling that their claims were for nonperformance, not for delay.  The court reasoned that World had “simply refused to transport” the plaintiffs, without offering them alternate transportation, “rather than merely delaying them.”  Of course, this ruling meant that the plaintiffs could not maintain their delay claims under the Convention, and the court granted World’s motion with respect to such claims.

Privity/agency.  The court held that while the tickets themselves did not establish contracts between the plaintiffs and World, factual issues prevented it from granting summary judgment to either side on the issue of World’s liability for Ritetime’s conduct.  The court ruled that the evidence presented was insufficient for it to decide whether the plaintiffs had bought their tickets directly from World; the plaintiffs presented evidence that they had done so, while World presented contradictory evidence.  Similarly, the court held that the existence of disputed facts prevented it from determining whether, as the plaintiffs alleged, Ritetime was World’s agent under theories of actual or apparent authority or that World had ratified Ritetime’s ticket sales.

ADA preemption.  The court rejected World’s contention that the federal Airline Deregulation Act preempted the plaintiffs’ fraud and negligence claims.  The ADA preempts certain state tort (and other) claims “related to a price, route, or service” of an airline.  However, some New York federal courts will refuse to rule that a tort claim is preempted where an airline has engaged in “outrageous” conduct that went “beyond the scope of normal aircraft operations.”  The court held that the ADA did not preempt the tort claims in this case because World’s refusal to transport the plaintiffs constituted “outrageous” conduct.

Court declines to dismiss complaint in passenger heart attack case

Watts v. American Airlines, Inc. (S.D. Ind. Oct. 10, 2007).  During a flight from Japan to Chicago in 2005, the passenger had a heart attack and died in a lavatory.  He was discovered by cleaning personnel after the aircraft had landed.

The plaintiff, the passenger’s wife, filed a lawsuit against American.  The airline moved to dismiss the complaint on the grounds that the plaintiff had failed to state a claim under the Montreal Convention, which applied to the transportation at issue and thus provided the plaintiff’s exclusive remedy.

Article 17(1) of the Convention governs an airline’s liability for a passenger’s death or bodily injury; it provides as follows:  “The carrier is liable for damage sustained in case of death or bodily injury of a passenger upon condition only that the accident which caused the death or injury took place on board the aircraft or in the course of any of the operations of embarking or disembarking.”  The U.S. Supreme Court has defined an “accident” as “an unexpected or unusual event or happening that is external to the passenger,” not ”the passenger’s own internal reaction to the usual, normal, and expected operation of the aircraft.”  In its motion, American contended that no “accident” had occurred because the passenger’s heart attack was caused by his own internal condition that was not related to the operation of the aircraft.

The court disagreed.  Taking the plaintiff’s allegations as true, the court reasoned that “American Airlines’ unusual or unexpected failure to recognize and/or respond to [the passenger’s] heart attack, and its failure to conform to industry custom and practices by responding to his medical emergency, could constitute a link in the chain of the events causing the ill-fated ‘accident’ on board [the flight].”  Accordingly, the court denied American’s motion to dismiss.

Montreal Convention inapplicable where injured passenger unable to prove that airline regarded multi-airline carriage as “single operation”

Kruger v. United Air Lines, Inc. (N.D. Cal. Nov. 1, 2007).  While waiting on a jetway to board a flight from San Francisco to Seattle, the passenger was inadvertently struck on the head by a backpack swung by another boarding passenger.  The passenger was able to board but became “dazed and nauseated” during the flight due to the incident.

The passenger’s complaint against United alleged that the Montreal Convention governed her claims and also that the airline was liable under various state common law tort causes of action, including negligence, negligent training and supervision of employees and negligent infliction of emotional distress.

United moved to dismiss the complaint on the grounds that the passenger’s state common law claims were preempted by the Montreal Convention.  In its motion, United expressed doubt that the Montreal Convention governed the case, as the incident appeared to have occurred in connection with a domestic flight, but United correctly stated that the court had to accept the passenger’s allegation that the Convention governed as true for purposes of the motion.  As previously reported, the court held that the Convention preempted the passenger’s state common law tort causes of action but that she had stated sufficient facts to plead a cause of action under Article 17 of the Convention by alleging “bodily injury” (the in-flight nausea) that had been caused by an “accident” (the backpack incident) during the course of embarking.

United then moved for summary judgment, arguing that the Montreal Convention did not apply because the jetway incident had occurred in connection with a domestic flight, not an international flight.  Prior to the flight at issue, the passenger had traveled on a United flight from Los Angeles to San Francisco and, before that, on a Qantas flight from Australia to Los Angeles.  Since more than one airline was involved in the transportation, for the flight at issue to constitute “international carriage” governed by the Montreal Convention, it had to be part of “one undivided carriage” under Article 1(3).  Under Article 1(3), a series of flights is considered “one undivided carriage” only “if it has been regarded by the parties as a single operation.”

The court held that the passenger had failed to produce sufficient objective evidence that United had regarded her flights “as a single operation.”  In support of its conclusion, the court noted that the United and Qantas tickets “were not issued by the same travel agent or made as part of a package,” that “they were reserved and paid for separately,” that “the two airlines did not have code sharing agreements and were not partners in the same worldwide alliance,” that “there were no communications between the airlines to coordinate the flights,” and that “the facts of one airline’s itinerary or ticketing was not reflected on the other airline’s itinerary or ticket.”  Accordingly, the court granted United’s motion for summary judgment.

Note:  The court’s summary judgment ruling did not end the case.  The court allowed the passenger to refile her state common law tort causes of actions against United – the very ones that the court had earlier held were preempted by the Montreal Convention – and she did so.