Morales v. Trans World Airlines, Inc.

Supreme Court of the United States · 1992 · Federal Courts

Federal CourtsPreemptionAirline Deregulation ActADApreemptionrelating torates routes servicesairline advertising

Facts

After Congress enacted the Airline Deregulation Act, States were forbidden to enforce laws relating to airline rates, routes, or services, while federal authority over deceptive trade practices remained with the Department of Transportation. The National Association of Attorneys General adopted guidelines governing fare advertising, including requirements for disclosure of restrictions, inclusion of taxes and surcharges in advertised fares, and rules about fare availability and use of terms like "sale" and "discount." Attorneys general from several States, including Texas, notified airlines that certain advertising practices violated state deceptive-practices laws and indicated enforcement actions were forthcoming. The airlines then sought federal declaratory and injunctive relief, claiming the state enforcement threatened by Texas was preempted.

Issue

Does the Airline Deregulation Act preempt States from enforcing their general consumer protection laws to prohibit allegedly deceptive airline fare advertisements under the NAAG fare-advertising guidelines? If so, was injunctive relief properly available against the threatened state enforcement?

Rule

Under 49 U.S.C. App. § 1305(a)(1), state enforcement actions are preempted if they have a connection with, or reference to, airline rates, routes, or services. Injunctive relief against threatened state enforcement is available under Ex parte Young when enforcement is imminent and the plaintiff otherwise lacks an adequate remedy at law, but such relief must be limited to the threatened enforcement and may not broadly prohibit hypothetical future applications.

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The attorney general of Ohio sends SkyHarbor Air a formal notice of intent to sue under Ohio's general deceptive-practices statute unless the airline's fare ads begin listing blackout periods, advance-purchase requirements, refund limits, and all taxes in the advertised price. SkyHarbor files in federal court seeking declaratory and injunctive relief before any state action is filed.

Is Ohio's threatened enforcement most likely preempted?

Explanation. The majority held that the ADA preempts state enforcement actions having a connection with, or reference to, airline rates, routes, or services. It also rejected the argument that only airline-specific laws are preempted; generally applicable state laws can be preempted as applied. Detailed fare-advertising requirements expressly referencing fares and governing how fares must be marketed relate to rates even if imposed through a general deceptive-practices statute. Preemption does not depend on proving inconsistency with federal law. (Derived from Morales v. Trans World Airlines, Inc. (n.d.).)