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Skies still cloudy: Federal preemption under Montreal Convention continues on turbulent track

The question of whether, and to what extent, federal law preempts state law for aviation claims falling under the purview of the Montreal Convention (“the Convention”) has remained a challenging and unsettled issue across jurisdictions for decades. With no official pronouncement from the Supreme Court of the United States, courts have been left to interpret what has amounted to unclear language of the Convention with minimal binding precedent, resulting in markedly inconsistent applications. While the purpose of the Convention was to reconcile supplemental amendments to the prior iteration of the treaty and achieve uniformity of the rules governing international carriage, one of the most critical issues—federal preemption—ironically continues on a path of relative uncertainty.

In the most recent judicial opinion to address this issue, Parrish v. City of Albuquerque became the first court in the Tenth Circuit to find that the Convention cannot be read to completely preempt state law claims. In Parrish, the passenger had booked a flight from Albuquerque, New Mexico to Canada. Although able to walk with limited mobility, the passenger was provided wheelchair assistance at check-in. After being escorted to the gate in the wheelchair, the passenger was then left unassisted during the boarding process, instructed by airline personnel to board without help, and was injured while attempting to push the wheelchair down the jet-bridge herself. Parrish at 2.

While specifying that case law is divided on whether complete federal preemption applies, the court looked to the plain meaning of Article 29 and its statutory construction to conclude that it permits alternative causes of action under state law outside the scope of the Montreal Convention. Specifically, the court found that the phrase “whether under this Convention or in contract or in tort or otherwise” meant that state law claims could be allowed because the conjunction “or” was used as a function word to indicate an alternative avenue of recovery for claimants. Parrish at 6. On the other hand, the court mentioned that if the Convention was read to require complete preemption, the words “or in contract or in tort or otherwise” would be rendered worthless as no alternative would be available. Parrish at 7.

In further disagreeing with the argument in favor of complete federal preemption, the court found that the reliance on the seminal U.S. Supreme Court decision of El Al Israel Airlines v. Tsui Yuan Tseng to be unpersuasive. The Parrish court did not view the conclusion of Tseng (“recovery for a personal injury suffered on board [an] aircraft or in the course of any of the operations of embarking or disembarking, if not allowed under the Convention, is not available at all”) as having a preemptive effect. Instead, Parrish reasoned that a conflict of law between authorities does not itself automatically result in total preemption and therefore any reliance on Tseng would improperly conflate the two legal doctrines. Parrish at 5.

Notably, the holding in Parrish is at odds with other district courts within the Tenth Circuit, including Callahan v. United Airlines (2017), where the court held that the Montreal Convention completely preempts state law and provides passengers an exclusive remedy. Callahan at 3. Importantly, the court examined the exact same language from the treaty as did Parrish, yet the Callahan court found that the Convention exclusively established itself as the only cause of action for claims within its scope because Article 29 “mandate[es] that any action, no matter the basis, can only be brought subject to the provisions of the Convention.” Callahan at 3. In also citing to Tseng—but to support its conclusion—the Callahan court pointed out that “recourse to local law would undermine the uniform regulation of international air carrier liability that the Convention was designed to foster.” Callahan at 2 citing Tseng.

Although there are stark differences of interpretation as to the scope of the Convention’s preemptive reach, courts do agree that there is no binding authority within the Tenth Circuit, and that there is division among courts in other jurisdictions as well. Given these continued inconsistencies, the issue of federal preemption under the Montreal Convention remains ripe for appellate review.

 


 

Charity Hyde, Perez Morris

Charity Hyde is the Managing Attorney, Northeast Offices of Perez Morris Hyde. Her core practice includes aviation-related litigation, transportation and motor vehicle liability, premises liability, and insurance fraud investigation. Charity’s background includes leading multi-attorney teams and representing airlines, airports, commercial entities, retailers, and large manufacturing clients in complex, high-exposure litigation in several states. You may contact her at chyde@perezmorris.com or 215-692-1235. Read more

Email Charity Hyde

 

 

Michael Aceto, Perez & Morris attorney headshot

Michael W. Aceto concentrates his practice in the areas of product liability, toxic tort, environmental, and general liability claims. He is a trial lawyer with experience defending companies and individuals in matters involving mass torts including asbestos, benzene, talc, mold, lead, and other chemicals, and dedicates a significant portion of his practice to complex product liability actions involving industrial equipment, commercial and consumer motor vehicles, construction machinery, and household consumer products.

Before entering private practice, Michael served as a law clerk in the Torts Litigation Section of the Pennsylvania Office of Attorney General and as a judicial law clerk to the Hon. Edward Griffith in the Chester County, PA Court of Common Pleas. In addition, he focuses his pro bono practice on counseling non-profit organizations in the educational system. Read more

Email Michael Aceto

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How claims of Non-Performance of a Contract seek to circumvent Montreal Convention Preemption

Liability governing the international shipment of goods between signatory countries proceeds through Articles 18 and 19 of the Montreal Convention. International air carriers subject to the Montreal Convention are strictly liable for damages caused by the delay in transporting goods, or due to physical damage otherwise sustained during international transport. Consequently, the Montreal Convention is typically the exclusive remedy for claims of delay or physical damage related to the international air transport of cargo. However, a recent Federal District Court’s decision in New Fortune, Inc. v. Apex Logistics International (CN) Ltd., et al. illustrates that while the Montreal Convention is the exclusive remedy in such instances, breach of contract claims alleging non-performance due to the delay or physical damage to goods could circumvent the Montreal Convention as the exclusive remedy to aggrieved parties. International carriers should be cognizant that damages to goods due to delay or physical damage may not always have the protections of the Special Drawing Rights afforded by the Montreal Convention.

New Fortune, Inc. v. Apex Logistics International (CN) Ltd., et al., is an international air cargo case decided in the United States District Court, Southern District of New York. The plaintiff alleged that six crates of medical masks were damaged and that its buyer refused to accept their late delivery, costing the plaintiff more than $1.65 million in damages, which included manufacturing and shipping costs, as well as lost profits from an additional two million masks it had purchased and planned to sell to the same customer. Plaintiff’s complaint alleged breach of contract, breach of bailment, and negligence against both carrier defendants based on the delayed delivery and physical damage the masks sustained during transit. The defendant carriers moved to dismiss plaintiff’s breach of contract, breach of bailment, and negligence causes of actions citing that Articles 18 and 19 of the Montreal Convention preempt those claims. Plaintiff countered arguing the physical damage to the masks and the delay in their delivery resulted in defendants’ non-performance of the contract between the parties. Plaintiff’s contention was that non-performance of a contract is not governed by the Montreal Convention.

The Court granted defendants’ motion to dismiss finding plaintiff’s claims fall within the scope of the Montreal Convention. However, the Court noted that dismissal of plaintiff’s claims was warranted because plaintiff’s complaint did not allege non-performance of the contract. Instead, the complaint explicitly claimed damages occasioned by delay in delivery and physical damage to delivered goods. The Court did not expound further on whether plaintiff’s breach of contract claim would have survived had it been predicated on non-performance. However, the implication exists that the Montreal Convention may not preempt breach of contract claims based on non-performance of a contract for the shipment of goods.

The decision in New Fortune, Inc. echoes a trend in recent Montreal Convention decisions limiting its preemptive scope. In light of the United States Supreme Court’s ongoing silence regarding whether the Montreal Convention completely preempts state law claims related to international travel between signatory countries, international carriers remain vulnerable to potential exposure beyond the cap in damages afforded by the Montreal Convention.

 


 

Charity Hyde, Perez Morris

Charity Hyde is the Managing Attorney, Northeast Offices of Perez Morris Hyde. Her core practice includes aviation-related litigation, transportation and motor vehicle liability, premises liability, and insurance fraud investigation. Charity’s background includes leading multi-attorney teams and representing airlines, airports, commercial entities, retailers, and large manufacturing clients in complex, high-exposure litigation in several states. You may contact her at chyde@perezmorris.com or 215-692-1235. Read more

Email Charity Hyde

 

 

Michael Aceto, Perez & Morris attorney headshot

Michael W. Aceto concentrates his practice in the areas of product liability, toxic tort, environmental, and general liability claims. He is a trial lawyer with experience defending companies and individuals in matters involving mass torts including asbestos, benzene, talc, mold, lead, and other chemicals, and dedicates a significant portion of his practice to complex product liability actions involving industrial equipment, commercial and consumer motor vehicles, construction machinery, and household consumer products.

Before entering private practice, Michael served as a law clerk in the Torts Litigation Section of the Pennsylvania Office of Attorney General and as a judicial law clerk to the Hon. Edward Griffith in the Chester County, PA Court of Common Pleas. In addition, he focuses his pro bono practice on counseling non-profit organizations in the educational system. Read more

Email Michael Aceto

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Walking The Tightrope: Waiver of Airline Defenses Under Montreal Convention Can Prove Costly, Despite Recoveries in “Bump” Cases

Involuntary denial of boarding a flight, also known as getting “bumped,” has been a common practice by airlines for years. It occurs in situations where there are more passengers scheduled to fly on an airplane than available seats. When a flight is full and overbooked, airlines use their own criteria to chose which passenger(s) will be removed or “bumped” from the flight.

In a recent case of “bumping,” in Lockhart v. Coastal Air Transport, the Supreme Court of the Virgin Islands affirmed the award of damages to a passenger who was wrongfully denied boarding an international flight from Dominica to St. Croix, initially due to an erroneous ticketing issue that was determined to be the fault of the airline. Lockhart at 1. On appeal, the primary question the Court addressed was the issue of whether a passenger who was involuntarily denied boarding (“bumped”) is entitled to compensation when the plane has a capacity of only nine seats. Importantly, although this case was within the purview of the Montreal Convention (“Convention”), as it involved international carriage, the Court noted that the airline had waived its right to assert defenses under the Convention because the airline did not raise those defenses in its responsive pleadings.[1] Lockhart at fn. 2. Instead, the airline relied upon Section 250 of the Code of Federal Regulations as authority to support its position that the passenger was not entitled to recovery for compensatory damages, such as the cost of the ticket and subsequent expenses including overnight accommodations.

Specifically, the airline argued that the passenger’s recovery was precluded under 14 C.F.R. §250.6, which permits an airline to deny a passenger from boarding an oversold flight in the event the aircraft has 60 or less seats and is unable to accommodate additional passengers due to weight/balance restrictions related to operation and safety. Lockhart at 2. In affirming the trial court’s award for the passenger, the Court endorsed the position that private legal action is permissible if airlines refuse recompense or passengers do not agree to an airline’s proposed compensation in “bumping” situations. Id. at 3. The Court determined that §250.6 was inapplicable because the airline presented no evidence that the passenger was denied boarding due to weight or balance restrictions. The Court also found that §250 did not apply in the first place because it is limited to a category of aircrafts that have a designed passenger capacity of 30 or more passenger seats, and the aircraft at issue was limited to only nine seats. Lockhart at 2. As a result, this case was governed by local law rather than the Code of Federal Regulations. Id. at 3.

As seen in Lockhart, multiple controlling authorities have the potential to govern these types of claims, including the Code of Federal Regulations, the Montreal Convention, local law, and potentially other sources. While individual facts and circumstances in each case will ultimately determine whether liability exists and the extent of available damages, the Montreal Convention can serve to provide levels of limitation on recovery and may provide grounds for complete dismissal in certain situations. Although the passenger’s recovery in Lockhart was ultimately upheld, the airline was fortunate that the scope of this particular claim was limited to nominal compensatory damages. In many situations, waiving defenses provided under the Montreal Convention is a risky proposition as the Convention provides a number of limitations on recovery and safeguards for air carriers, including caps on delay damages per Article 19, preclusion of recovery for delays under Article 17, in addition to the prohibition of emotional and punitive damages. Carriers flying internationally rely on these limitations on recovery, and risk losing these protections when waiving the defense of the Montreal Convention.

[1] It is unknown whether waiving defenses under the Montreal Convention was done intentionally or not.

 


 

Michael Aceto, Perez & Morris attorney headshot

Michael W. Aceto concentrates his practice in the areas of product liability, toxic tort, environmental, and general liability claims. He is a trial lawyer with experience defending companies and individuals in matters involving mass torts including asbestos, benzene, talc, mold, lead, and other chemicals, and dedicates a significant portion of his practice to complex product liability actions involving industrial equipment, commercial and consumer motor vehicles, construction machinery, and household consumer products.

Before entering private practice, Michael served as a law clerk in the Torts Litigation Section of the Pennsylvania Office of Attorney General and as a judicial law clerk to the Hon. Edward Griffith in the Chester County, PA Court of Common Pleas. In addition, he focuses his pro bono practice on counseling non-profit organizations in the educational system. Read more

Email Michael Aceto

 

Gray Oxford, Perez-Morris headshot

Gray has extensive New York civil litigation experience defending high exposure cases involving alleged premises, construction, elevator, New York State Labor Law, environmental and toxic torts, asbestos, landscaping, auto, and municipality claims. Prior to joining Perez Morris Hyde, Gray spent over 5 years with his prior firm as lead counsel for cases at the Trial and Appellate levels, including a published and favorable decision by the First Department, Appellate Division of New York. Dillon K. v. N. Blvd. 4818, LLC, 161 A.D.3d 664, 77 N.Y.S.3d 69 (N.Y. App. Div. 2018).

Gray is excited to be a part of the growing and collaborative, NAMWOLF certified team at Perez Morris. Read more

Email Gray Oxford

 

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Venue remains critical question in Montreal convention litigation, Georgia Federal Court opines on forum non conveniens

Over the past several years, venue considerations in lawsuits involving international carriage under the Montreal Convention (“the Convention”) have become increasingly more frequent and meaningful in various jurisdictions. As exemplified in certain federal appellate-level decisions, such as Hosaka v. United Airlines, Pierre-Louis v. Newvac Corp., and Delta Airlines v. Chimet, in addition to others, changing a case’s venue may drastically impact the trajectory and outcome of a particular aviation-related lawsuit. As court rules vary widely, not only within the United States, but even more so throughout the world, jurisdictional questions are amplified when considered on the global stage.

 

Historically, forum non conveniens has been utilized by airline defendants as a procedural device to dismiss a case from a court within the United States in favor of a foreign jurisdiction, as was the case in Bintu v. Delta Airlines, Inc., 2020 WL 3404925, (N.D. Ga. June 12, 2020), the most recent federal decision to opine on the issue of venue under the Montreal Convention. In Bintu, plaintiff, a resident of Germany, purchased a roundtrip ticket through Delta, a commercial U.S. airline. Pursuant to Delta’s joint venture agreement with co-defendant, KLM Royal Dutch Airlines (“KLM”), headquartered in The Netherlands, KLM operated plaintiff’s return flight from Atlanta, Georgia to Munich, Germany with a layover in Amsterdam. Bintu at 1. During the flight from Atlanta to Amsterdam, a flight attendant allegedly pushed a beverage cart into plaintiff’s knee, causing him injury. Id. Plaintiff filed suit in Georgia’s District Court, and the airline defendants moved to dismiss based upon forum non conveniens.

 

As with other areas of litigation, forum non conveniens within the context of international carriage is a common law doctrine that permits a court to decline jurisdiction over a case, despite proper personal jurisdiction and venue, in the event there is a more convenient forum. Similar to other courts, the Eleventh Circuit, a hotbed for this type of litigation, determines the validity of dismissal pursuant to forum non conveniens by utilizing a three-part test, consisting of: (1) whether an adequate alternative forum is available; (2) public and private interest factors; and (3) whether plaintiff can reinstate the suit in the alternative forum without undue inconvenience or prejudice, in addition to a multitude of sub-factors and considerations. Bintu at 2.

 

In granting the airlines’ motion, the court found that plaintiff’s case was more conveniently suited in Germany. The court found that all of the factors examined as part of the forum non conveniens analysis weighed in favor of dismissal, including the availability and adequacy of the German courts, private interest factors involving access to written evidence and witnesses, as well as plaintiff’s uninhibited ability to reinstate his claim in Germany. Importantly, the court mentioned that while there is normally a “strong presumption” that plaintiff has chosen a convenient forum, the presumption weakens if the plaintiff is not a United States citizen. Bintu at 4. The court specifically found that Germany’s availability as a forum, and the “overwhelming volume of evidence located in Europe” arising from plaintiff’s German residence, in addition to KLM’s documents and cabin crew located either in The Netherlands or elsewhere in Europe, warranted dismissal under forum non conveniens. Bintu at 4.

 

As the court in Bintu pointed out, although the Montreal Convention exclusively governs the issue of liability for personal injury claims occurring while onboard an aircraft during an international flight, the Convention provides only a basic framework, rather than an entire body of substantive law needed to adjudicate a claim. Bintu at 4. Certain essential questions are not addressed by the Convention, including issues of compensatory damages and procedure, which are instead governed by the applicable domestic law. Given how these elements of local law may impact the outcome of a particular case, venue considerations remain a crucial threshold question for all claims that fall under the Montreal Convention’s purview.

 


 

Michael Aceto, Perez & Morris attorney headshot

Michael W. Aceto concentrates his practice in the areas of product liability, toxic tort, environmental, and general liability claims. He is a trial lawyer with experience defending companies and individuals in matters involving mass torts including asbestos, benzene, talc, mold, lead, and other chemicals, and dedicates a significant portion of his practice to complex product liability actions involving industrial equipment, commercial and consumer motor vehicles, construction machinery, and household consumer products.

Before entering private practice, Michael served as a law clerk in the Torts Litigation Section of the Pennsylvania Office of Attorney General and as a judicial law clerk to the Hon. Edward Griffith in the Chester County, PA Court of Common Pleas. In addition, he focuses his pro bono practice on counseling non-profit organizations in the educational system. Read more

Email Michael Aceto

 

Gray Oxford, Perez-Morris headshot

Gray has extensive New York civil litigation experience defending high exposure cases involving alleged premises, construction, elevator, New York State Labor Law, environmental and toxic torts, asbestos, landscaping, auto, and municipality claims. Prior to joining Perez Morris Hyde, Gray spent over 5 years with his prior firm as lead counsel for cases at the Trial and Appellate levels, including a published and favorable decision by the First Department, Appellate Division of New York. Dillon K. v. N. Blvd. 4818, LLC, 161 A.D.3d 664, 77 N.Y.S.3d 69 (N.Y. App. Div. 2018).

Gray is excited to be a part of the growing and collaborative, NAMWOLF certified team at Perez Morris. Read more

Email Gray Oxford