11TH CIRCUIT REVIVES CLASS ACTION SUIT ALLEGING BREACH OF CONTRACT OF CARRIAGE
March 8, 2022
On February 3, 2022, a three-judge panel for the 11th Circuit Court of Appeals (the “Court”) ruled to revive a proposed class action lawsuit against Avior Airlines alleging that it breached its contract of carriage by requiring passengers to pay an $80 “exit fee” before boarding their flights from Miami to Venezuela that was not explicitly disclosed during the booking process. The ruling has caused many airlines to begin reevaluating how they disclose information on ticket taxes and other fees in their contracts of carriage as the Court’s ruling has shown how some claims may be able to proceed despite Airline Deregulation Act protections.
The Airline Deregulation Act (the “ADA”) generally provides air carriers with protections against lawsuits that seek to enforce state or local laws that relate to the air carriers’ prices, routes or services. Following institution of the ADA, the U.S. Supreme Court in American Airlines, v. Wolens, granted plaintiffs a narrow exception to preemption to be able to sue airlines for breach of the carrier’s self-imposed contractual obligations. In other words, a plaintiff cannot simply rely on state tort law or other policies to try to create an airline obligation that the airline itself did not create and agree to in its contract of carriage. Nevertheless, according to the Court, because the plaintiffs’ breach of contract claims against Avior sought merely to “enforce the parties’ private agreements regarding the cost of passage “ and in fact, did not invoke state laws or regulations to alter the agreed upon price, the Court determined that the plaintiffs could proceed with their claim because it was not preempted. The Court’s decision has prompted new guidance to airlines including the suggestion to incorporate more robust language in their contracts of carriage to ensure as much as possible that their contracts of carriage cover all prices, taxes, and fees that passengers will be required to pay, including airfare, ancillary fees and/or government-imposed charges and taxes to better guard against the type of claim that was successfully brought against Avior. The Court’s ruling comes as several other ADA preemption cases continue in many states including, Alabama, Florida, and Georgia.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com 202-659-6622) or Drew Derco (dderco@eckertseamans.com 202-659-6665).
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