It looks like consumers will have another shot at bringing airlines to justice when they break contracts with passengers. This stunning Federal Appeals Court ruling issued by the Ninth U.S. Circuit Court would roll back more than 30 years of precedent in how airlines are treated in the courts.
You can bet this ruling will be appealed to the Supreme Court and the outcome is far from certain. If this ruling holds, this will be a big deal for both airlines and passengers.
The airlines have strongly opposed any changes to the past court rulings that say regulation of the airlines falls under Department of Transportation (DOT) auspices.
This ruling specifically calls out airlines’ customer service failures that can be considered contract issues rather than airlines’ pricing prerogatives, scheduling issues and operational factors.
Air carriers have argued that the 1978 law, which prohibits state regulation of their prices, routes or services, bars customers from using state laws to file suits that could affect airline operations. A judge in San Diego agreed with that argument in dismissing a suit by a passenger who accused Northwest Airlines of arbitrarily revoking his frequent-flier status in 2008.
But the Ninth U.S. Circuit Court of Appeals in San Francisco said the federal law forbids only state laws and lawsuits that would directly require changes in prices, routes or service, and doesn’t excuse airlines from honoring their contracts with passengers.
The purpose of the law was “to make the airline industry more efficient by unleashing the market forces of competition – it was not to immunize the airline industry” from responsibility for reneging on its own agreements, like the frequent-flier program, the court said in a 3-0 ruling.
Should the plaintiff succeed in the Supreme Court, this will upend the cozy situation the airlines have existed in with DOT and make them subject to civil law in some circumstances.
The Consumer Travel Alliance is monitoring these developments and possible changes in the airline/passenger legal landscape closely.
Charlie Leocha is the President of Travelers United. He has been working in Washington, DC, for the past 14 years with Congress, the Department of Transportation, and industry stakeholders on travel issues. He was the first consumer representative to the Advisory Committee for Aviation Consumer Protections appointed by the Secretary of Transportation from 2012 through 2018.
