Source: https://www.jdsupra.com/legalnews/the-answers-to-some-of-your-questions-47531/
Timestamp: 2019-05-22 05:51:12
Document Index: 76578600

Matched Legal Cases: ['§ 41310', '§ 250', '§ 250', '§ 250', '§ 250', '§ 41713', '§ 250', '§ 250', '§ 250', '§ 250', '§ 41310', '§ 41310', '§ 250', '§ 250']

The Answers to Some of Your Questions About What Airlines Can Do When a Flight is Overbooked and Someone Is Going to Have to Get Off of the Plane | Butler Weihmuller Katz Craig LLP - JDSupra
The Answers to Some of Your Questions About What Airlines Can Do When a Flight is Overbooked and Someone Is Going to Have to Get Off of the Plane
Suddenly, the entire world is interested in learning about the laws governing airlines’ actions when a flight is overbooked. It isn’t every day that the entire world suddenly wants to learn all about something that you’ve spent years studying, so this post is for our clients who insure aviation risks, our clients who are frequent air travelers, and perhaps a few curious strangers who have no business with our law firm but have nonetheless been led here by their quest for answers. Search no further; here are the answers to the questions on everyone’s mind.
1. Can an airline sell more tickets for a flight than it has seats available?
They sure can. In fact, they pretty much have to. People want – and demand – the flexibility of being able to change or cancel their tickets without penalty, but that comes at the cost of the airlines’ being unable to know how many people will be on a given flight until the last minute. Nearly every flight has a handful of people with confirmed reservations who either cancel at the last minute or simply don’t show up.
Flying with empty seats isn’t something that airlines can afford to do. Owning a commercial airplane is expensive. In addition to the finance payments on it, airplanes need regular maintenance, fuel, and paid flight crews. They hemorrhage money. To have a fighting chance of staying in business, an airplane has to bring in more money than it loses, which means it needs to be up in the air nearly constantly and nearly full. Fortunately, airlines have years of data and experience that allows them to predict, with reasonable accuracy, how many people will no-show and sell that many extra tickets. Most of the time, you don’t even know that the flight was overbooked because the airline correctly guessed how many people would no-show.
Of course, even with experience and data on their side, it’s an imperfect science, and sometimes there will be more passengers than seats. The airline industry calls this an “oversale situation” (yes, it’s really called that), and as a result, passenger’s get “bumped.” Now, you’re going to love this: The plaintiff in the leading case about “bumping” is none other than Ralph Nader, Esq.; Perhaps you’ve heard of him. See Nader v. Allegheny Airlines, Inc., 512 F.2d 527 (D.C. Cir. 1975). Back in 1972, Ralph had a couple of speeches to give in Connecticut and purchased a plane ticket from a travel agent that morning to fly from Washington to Hartford. He arrived at the gate five minutes before takeoff, only to be told by the gate agent that the flight was full and he couldn’t board. The airline offered him an air taxi to Philadelphia, from which he could catch a connecting flight to Hartford. But he was concerned about missing the connection and flew instead to Boston. From there, the people organizing the speech sent someone to meet him at the airport and drive him to that second speech, but he was a half-hour late and missed the first speech altogether.
You’re not going to believe this, but Ralph responded by suing the airline. One of his arguments was that the practice of overbooking flights was, itself, a form of fraud for which passengers could sue airlines. Ultimately, the Court of Appeals for the D.C. Circuit rejected this aspect of his claim, recognizing that overbooking was a necessary evil and that airlines had to do it. The Nader court therefore held that overbooking was not, in and of itself, a violation of the law. A few years later, Congress passed the Airline Deregulation Act, which makes certain that passengers on domestic flights cannot sue for “bumping.” But, keep reading.
2. So, an airline can just bump whomever they want without consequence?
No. It’s much more complicated than that. Federal law prohibits an air carrier from subjecting persons to unreasonable discrimination. See 49 U.S.C. § 41310. So, even though bumping people doesn’t violate the law in and of itself, airlines still can’t discriminate against people based on race, gender, religion, and so forth, in determining who gets bumped. To ensure that the process is fair, federal regulations require every air carrier to ask for volunteers first, and they can offer compensation for volunteers. See 14 C.F.R. § 250.2b. Each air carrier is also required to have rules and criteria for determining who gets bumped involuntarily if nobody volunteers. These rules can take into account such things as the time a passenger checked in, the fare paid by a passenger, the passenger’s frequent-flyer status, whether a passenger has a disability or is an unaccompanied minor, and so forth. See 14 C.F.R. § 250.3. If an airline breaks its own internal rules in selecting whom to bump, it can theoretically be sued, but the Air Deregulation Act is a difficult hurdle to get over (discussed further below), so “bumping” lawsuits aren’t very common.
Federal law also requires some limited compensation in certain situations. A passenger who volunteers to take another flight would get whatever compensation was offered. If a passenger is involuntarily bumped, compensation depends on the circumstances. If the airline offers alternate transportation scheduled to arrive no more than an hour later than the original flight, no compensation is required. If the carrier offers alternate transportation scheduled to arrive between one and two hours after the originally planned arrival time, the airline must pay the passenger twice the original airfare (but with a maximum of $675). If the carrier doesn’t offer alternate transportation that would get the passenger there no more than two hours late, the carrier must compensate the passenger at four times the value of her original ticket (maximum $1,350). See 14 C.F.R. § 250.5. There are a number of exceptions and nuances to this in 14 C.F.R. §§ 250.5-250.6, but that’s the general idea. Most of this is explained in the “Conditions of Carriage,” which are usually printed on the inside of that curious little envelope with the diagonal slit that they give you with your boarding pass. Open that up sometime and read the riveting fine print in there.
International flights are different and involve international treaties on air carriage, but that’s another blog for another day.
3. Can an airline forcefully remove a bumped passenger from an airplane after the passenger has boarded?
It’s one thing to deny boarding. It’s quite another to allow someone to board a plane, ask her to leave, and then put your hands on her when she refuses. But, can she sue an airline for that?
Back to that Airline Deregulation Act (see above). The point of the Airline Deregulation Act was to make the laws uniform from place to place. It accomplishes this by providing that only the federal government can create laws regulating the “price, route, or service” of an air carrier. See 42 U.S.C. § 41713(b)(4). Common-law claims for torts like battery, defamation, emotional distress, or false imprisonment arise out of state law, not federal law. The Airline Deregulation Act bars these state-law claims if they arise from an airline’s “service,” so when faced with such a claim, the courts try to determine whether such lawsuits arise from an airline’s “services” or from something else. If it’s a “service,” it’s preempted by the Airline Deregulation Act, and the passenger can’t sue for it.
So, what is a “service”? The courts have created a three-part test (called the “Rombom test” after the case that first invented it) to decide whether a state-law tort claim is preempted by the Airline Deregulation Act. First, the courts define whether the activity being sued for is an airline “service.” If so, the court then determines whether the claim affects the airline service directly or just incidentally. Lastly, the courts will look to whether the airline’s conduct was reasonably necessary to the provision of the service. See Rombom v. United Air Lines, Inc., 867 F. Supp. 214, 221-22 (S.D.N.Y. 1994). To borrow an example from the oral argument in the Rombom case, if a passenger is interfering with a flight attendant’s providing flight-safety instructions and the passenger refuses to be quiet after being asked, the Airline Deregulation Act would probably bar a tort claim for emotional distress if the flight attendant rudely and unprofessionally asked for quiet. On the other hand, if the flight attendant decided to quiet the passenger by shooting her, the Airline Deregulation Act probably wouldn’t bar a lawsuit because that wouldn’t have been reasonably necessary to quiet the passenger; there were other ways. The line is drawn at what is “reasonable,” and depending on the circumstances, it can sometimes be reasonable to have a passenger forcibly removed by police.
Having a violent or disorderly passenger removed is one thing, but what of a well-behaved passenger who is only being asked to deplane because of an oversale situation? Would that be reasonable? In Peterson v. Continental Airlines, Inc., 970 F. Supp. 246 (S.D.N.Y. 1997), a dispute arose on an overbooked flight after it appeared that more than one passenger had been assigned the same seat. When flight crew asked the plaintiff to deplane, she refused, and the airline summoned police, who physically lifted her from the seat, handcuffed her, and forcibly removed her from the airplane (sound familiar?). Applying the Rombom test to their claim, the Peterson court found the first prong to be satisfied because flight attendants’ efforts to locate seat assignments and resolve seat conflicts were “services.” But the court thought that the second and third prongs were not met because the airline was alleged to have gone far beyond what was necessary to resolve a seat dispute and abused its authority to provide a given service.
To boil all of that down to a simple answer: An airline can use physical force to remove a passenger from a plane, but only under circumstances where it’s reasonable to do that. Of course, in the moment when the airline has to make that decision, there is no referee around to call it reasonable or unreasonable; that decision ends up being made by a judge or a jury long after the fact. Accordingly, forcibly removing a passenger carries the risk that the airline’s decision will later be deemed unreasonable. Because of this reality, airlines should be very judicious when deciding to take such an action. A violent and unruly passenger who poses a danger to the other passengers? Sure, most people would think it reasonable to use physical force to remove that passenger. A loveable sympathetic elderly lady who is bumped due to an oversale situation but refuses to get off of the plane because she doesn’t want to miss her grandson’s graduation from Basic Training? Putting your hands on her could prove to be a very costly mistake.
4. Would an airline’s insurance policy cover its liability for that?
It’s hard to say. Insurance policies generally exclude coverage for intentional acts by an insured. So, if a passenger sued an airline for battery, that’s usually not covered. On the other hand, if the passenger were to sue for negligence, airlines’ liability-insurance policies generally cover liability for negligence.
5. We’re an airline with an oversale situation on one of our flights that has already boarded. We’re offering eight hundred dollars to anyone who volunteers to get off of the plane, but no one is taking our offer. Should we call the airport police and have them beat one of our passengers up and drag him off of the plane bloodied and screaming while the other passengers film it with their phones and upload it to the internet?
That’s probably not a very good idea. Even if you think it will pass the Rombom test and be preempted by the Airline Deregulation Act, the passenger’s lawsuit would be the least of your problems. A public-relations disaster like that can cause a publicly traded company’s market capitalization to fall by about $225 Million in two days. You could literally offer one million dollars to any passenger who will give up her seat voluntarily, and you’d still be $224 Million ahead of where you’d be if you did what you’re thinking about doing. But if you have a plane full of people and you only need one volunteer, that’s a textbook “reverse auction,” and you probably don’t have to offer a million dollars. A thousand dollars will probably do it. Aren’t you glad you saved yourselves millions of dollars by calling us first?
6. Yeah, about that…what if we already did it and our stock price is now in a freefall? Should we dig up some dirt on the passenger and leak it to the press in effort to control the PR disaster by reducing public sympathy for him?
That’s an even worse idea. That’s not an airline “service” and therefore would never pass the Rombom test if the passenger were to bring suit for defamation or invasion of privacy. Moreover, that would be an intentional act that probably wouldn’t be covered by your insurance policy.
On top of all that, it probably wouldn’t even fix your PR problem. In fact, it’s likely to backfire. People are tuned in to this manner of public-relations damage control, which some call “victim shaming,” and will likely respond by asking whether persons who lack pristine criminal records can expect to spend time on your airplanes without being beaten up. The last thing you want to do right now is appear unapologetic and recriminatory. It’s likely to make your situation far worse than it already is.
7. So, about that…
Ok, this is really bad. You can survive this, but it’s going to take some doing. On the bright side, people have really short attention spans. It’s no fun being the outrage du jour, but by next week everyone will be so busy being outraged at something else that they’ll forget all about you. (If you check your mailbox, you probably have a thank-you card in there from Pepsi Co.) Meanwhile, it’s important to learn from incidents like this and review your internal rules about bumping passengers. You probably also want to review your policies on forcibly removing passengers, reserving that extreme measure solely for situations where a passenger poses a danger.
As for your passenger, it’s probably a good idea to settle his claim and get a confidentiality agreement to make sure he doesn’t sit down for an interview with 60 Minutes and remind people about this. You probably also want to consider a loss-leader pricing strategy to gain back some customer goodwill. If your customers decide that this was an anomalous incident for which you are truly sorry, and if your airfares are significantly lower than your competitors, they’ll eventually forgive this incident and fly on your airline again. People can be very fair.
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§ 250.2b Carriers to request volunteers for denied boarding , 14 C.F.R. § 250.2b
§ 250.3 Boarding priority rules , 14 C.F.R. § 250.3
Peterson v. Continental Airlines, Inc. , 970 F. Supp. 246 (S.D.N.Y. 1997)
§ 41310. Discriminatory practices , 49 U.S.C. § 41310
Rombom v. United Air Lines, Inc. , 867 F. Supp. 214 (S.D.N.Y. 1994)
Nader v. Allegheny Airlines, Inc. , 512 F.2d 527 (D.C. Cir. 1975)
§ 250.5 Amount of denied boarding compensation for passengers denied boarding involuntarily , 14 C.F.R. § 250.5