Key Legal Aspects of Airline Deregulation and Supreme Court Decisions

This content discusses key aspects of the Airline Deregulation Act, the Supremacy Clause, and important Supreme Court decisions like Morales v. Trans World Airlines and American Airlines v. Wolens. It highlights how federal laws preempt state regulations concerning airline pricing, routes, and services, ensuring consistency in air carrier operations.

• Airline Deregulation
• Supreme Court Decisions
• Preemption
• Federal Law
• Aviation

hcab Follow

Uploaded on Oct 05, 2024 | 0 Views

Download Presentation

Please find below an Image/Link to download the presentation.

The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author. Download presentation by click this link. If you encounter any issues during the download, it is possible that the publisher has removed the file from their server.

Presentation Transcript

1. The Airline Deregulation Act and The Airline Deregulation Act and Air Ambulance Litigation Air Ambulance Litigation January 16, 2020 Paul Geier, Assistant General Counsel for Litigation and Enforcement Charles Enloe, Senior Trial Attorney Office of Litigation and Enforcement General Counsel s Office

2. The Supremacy Clause The Supremacy Clause This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or laws of any State to the Contrary notwithstanding. Article VI United States Constitution 2

3. The Airline Deregulation Act The Airline Deregulation Act a State, political subdivision of a State or political authority of at least two 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) 3

4. Two Key Supreme Two Key Supreme Court Decisions Court Decisions 4

5. Morales v. Trans World Airlines Morales v. Trans World Airlines, , 504 U.S. 374 (1992) 504 U.S. 374 (1992) Congress enacted the ADA preemption provision in order to ensure that states would not undo federal deregulation with regulation of their own The ADA expresses a broad preemptive purpose by its use of the term related to in defining the scope of preemption. State enforcement actions having a connection with or reference to airline rates, routes, or services are preempted by the ADA. The obligations imposed by the state s fare 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. DOT retains the power to prohibit advertisements which in its opinion do not further competitive pricing. 5

6. American Airlines v. American Airlines v. Wolens 513 U.S. 219 (1995) 513 U.S. 219 (1995) The ADA s preemption provision bars state-imposed regulation of air carriers, but allows room for court enforcement of contract terms set by the parties themselves. Thus, in a frequent flyer lawsuit, claims arising under the Illinois Consumer Fraud statute are preempted, but breach of contract claims under the frequent flyer contract itself may proceed. We do not read the ADA s preemption clause, however, to shelter airlines from suits alleging no violation of state-imposed obligations, but seeking to recover solely for the airline s alleged breach of its own, self-imposed undertakings. Wolens, , 6

7. ADA Covers Air Ambulance Operators ADA Covers Air Ambulance Operators ADA preemption covers all air carriers authorized by DOT s Office of the Secretary to provide interstate or foreign air transportation, including air ambulance operators. Air Evac EMS v. Cheatham, 910 F.3d 751 (4th Cir. 2018) If an air ambulance operator is authorized to provide interstate transportation, ADA preemption applies even with respect to trips within a single State. Scarlett v. Air Methods Corp., 922 F.3d 1053 (10th Cir. 2019) 7

8. Preemption of State Statutes Preemption of State Statutes Guardian Flight v. Godfread, 359 F. Supp. 3d 744 (D.N.D. 2019) North Dakota ban on air ambulance balance billing Valley Med Flight v. Dwelle, 171 F. Supp. 3d 930 (D.N.D. 2016) North Dakota statute effectively requiring air ambulance operators to go in-network with insurers. Bailey v. Rocky Mountain Holdings, 889 F.3d 1259 (11th Cir. 2018) Florida law capping payments by auto insurers and prohibiting balance billing by providers. 8

9. Other Preemption Principles Other Preemption Principles States may regulate medical aspects of air ambulances. States may not regulate aviation safety, which is the exclusive responsibility of the Federal Aviation Administration. McCarran-Ferguson Act: Federal statutes do not preempt State regulation of business of insurance unless they specifically relate to the business of insurance. 9

10. State Law Requiring Payment State Law Requiring Payment Express Contract Implied-in-Fact Contract Reasonable price Equitable Principles (Implied-in-Law Contract, etc.) Value of benefit conferred 10

11. Brief for the United States in Brief for the United States in Scarlett v. Air Methods Corp. Scarlett v. Air Methods Corp. (10 (10th th Cir.) Cir.) Implied-in-Fact Contract Reasonable price implied by State law not preempted. Equitable Principles If carrier relies on State law equitable principles as basis for payment, it cannot prevent patients from relying on same principles to limit amount of payment. Scarlett v. Air Methods Corp., 922 F.3d 1053 (10th Cir. 2019) 11

12. Ferrell v. Air Evac EMS Ferrell v. Air Evac EMS 900 F.3d 602 (8 900 F.3d 602 (8th th Cir. 2018) Cir. 2018) Air EVAC can assert an equitable claim to recover for the services it provided. If there is no contract, the common law typically provides that a provider may recover the fair value or reasonable value of the services provided. What law applies in resolving these issues? No federal or unpreempted state law authorizes an agency to determine Air EVAC s just and reasonable rates . . . . Absent further federal legislation, it seems obvious that a state or federal court asked to determine these contract and restitution issues will necessarily look to governing principles of state law. This is not contrary to the marketplace principles adopted in the ADA. It is the way disputes between private contracting parties are decided in a deregulated marketplace. 12

13. Constitutionality of ADA Constitutionality of ADA Scarlett v. Air Methods Corp., 922 F.3d 1053 (10th Cir. 2019) Stout v. Med-Trans Corp., 313 F. Supp. 3d 1289 (N.D. Fla. 2018) 13