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Transportation – Preemption

By: WISCONSIN LAW JOURNAL STAFF//December 23, 2014//

Transportation – Preemption

By: WISCONSIN LAW JOURNAL STAFF//December 23, 2014//

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U.S. Court of Appeals For the Seventh Circuit

Civil

Transportation – Preemption

Federal law preempts claims against airlines based on violates of state consumer protection law.

“We close with a word about the common-sense argument that Lagen presents and our dissenting colleague emphasizes: that United must be accountable under some body of law because its representation that it was bestowing ‘lifetime’ benefits on its Million-Mile flyers is irreconcilable with its
reserved right under the MileagePlus Program Rules to modify and cancel those benefits at any time. This point does not depend on the existence of a separate contract for Million-Mile Flyer benefits. Instead, Lagen argues, it illustrates United’s misleading—perhaps even fraudulent—advertising practices. Unfortunately for Lagen, this argument runs squarely into the Airline Deregulation Act of 1978 (ADA), 49 U.S.C. § 41713, which preempts any claim based on viola-tions of state consumer protection law. See Am. Airlines, Inc. v. Wolens, 513 U.S. 219, 228 (1995) (the ADA preempts claims under the Illinois Consumer Fraud and Deceptive Business Practices Act related to frequent flyer programs). See also Northwest, Inc. v. Ginsberg, 134 S. Ct. 1422, 1432 (2014) (claim for breach of state-imposed covenant of good faith and fair dealing is preempted); Morales v. Trans World Airlines, Inc., 504 U.S. 374, 378, 391 (1992) (the ADA ‘preempts the States from prohibiting allegedly deceptive airline fare advertisements through enforcement of their general consumer protection statutes’). Naturally, the ADA ‘does not give the airlines carte blanche to lie to and deceive consumers.’ Morales, 504 U.S. at 390. What it does do, however, is channel grievances of this type to the Department of Transportation, which is authorized to regulate such activities. See id. at 391. That may not be as satisfying as a private right of action for the disappointed consumer, but that is the choice Congress made.”

Affirmed.

14-1375 Lagen v. United Continental Holdings, Inc.

Appeal from the United States District Court for the Northern District of Illinois, Leinenweber, J., Wood, J.

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