There are two new developments to report in the ongoing EU 2611 class action cases currently pending in the United States District Court for the Northern District of Illinois. On September 13, 2013, Judge Sharon Johnson Coleman rendered an opinion and order in the Gurevich v. Alitalia class action,2 denying Alitalia’s motion to dismiss the plaintiffs’ claim against Alitalia for a direct violation of the European Union’s passenger protection regulation known as EU 261. Two weeks later, Continental Airlines, one of the five other airlines that have been defending separate class action lawsuits based on EU 261 since February 2011, achieved a more favorable result when Judge John A. Nordberg, the presiding judge in the Lozano v. Continental case,3 granted Continental’s motion to dismiss the same cause of action asserted by the Lozano plaintiffs. While the issue on both motions was the same – can plaintiffs seek to recover passenger delay damages based solely on an airline’s alleged violation of a foreign law – the different results achieved by Alitalia and Continental turned on the manner in which each of the airlines framed and argued the issue of whether EU 261 claims could be brought in a United States class action litigation.
As previously reported,4 the Alitalia and Continental cases are two of the seven EU 261 class action lawsuits that have been filed in the Northern District of Illinois since February 2011 by passengers of Alitalia and Continental, as well as passengers of Iberia, British Airways, Lufthansa, Delta, and United.5 In each case, the plaintiffs alleged that the respective airline violated the European Union passenger protection regulation known as EU 261, which obligates the operating carrier of a flight to compensate passengers who are delayed three hours or more as the result of a flight cancellation or flight delay. Each set of plaintiffs alleged that they experienced a flight cancellation or delay but were never compensated by their respective carrier. Initially, the plaintiffs sued their respective carrier (with the exception of the plaintiffs in the United class action) for breach of contract,6 under the theory that each airline agreed to abide by EU 261 in its respective contract of carriage and its failure to compensate the plaintiffs constituted a breach of contract. As reported in our Spring 2012 Newsletter, the judges presiding over the cases generally agreed that the plaintiffs’ breach of contract causes of action could be sustained only if the airline’s conditions of carriage expressly provided that the airline would abide by EU 261; otherwise, the courts agreed, the Airline Deregulation Act (“ADA”)7 applied and preempted the plaintiffs’ claims. Based on ADA preemption grounds, Judge Ruben Castillo, Judge Nordberg and Judge Edmond Chang dismissed the breach of contract claims that had been asserted against British Airways, Continental and Delta, respectively.8
While Judge Castillo’s ruling effectively ended the case against British Airways, the actions against Continental and Delta remained pending because, prior to Judge Nordberg and Judge Chang issuing their decisions on the plaintiffs’ breach of contract claims, the plaintiffs in the Continental and Delta cases amended their complaints to assert a second cause of action for a direct violation of EU 261. Soon after, the plaintiffs in the Alitalia, Iberia, Lufthansa, and United cases also asserted a new cause of action for a direct violation of EU 261. Following the assertion of this new claim, each of the six airlines – Alitalia, Continental, Iberia, Lufthansa, Delta and United – moved to dismiss the plaintiffs’ direct claims for violation of EU 261 on various grounds. Judge Coleman issued the first decision on one of the motions to dismiss in the Alitalia case, in which she denied Alitalia’s motion to dismiss on September 13, 2013.
In denying Alitalia’s motion, Judge Coleman was unpersuaded by Alitalia’s arguments that the ADA and the Montreal Convention preempted the plaintiffs’ direct cause of action for violation of EU 261 and also denied Alitalia’s request for dismissal pursuant to the discretionary doctrine of international comity. With respect to its first argument, Alitalia argued that Congress intended the ADA to preempt foreign laws like EU 261 and that ADA preemption should not be confined to “State” laws, as the plaintiffs had argued. Judge Coleman found the ADA’s definition of “State” unambiguously excluded foreign countries and Alitalia had not convinced to her to depart from the general rule that the express statutory definition applied. Judge Coleman also found that the Montreal Convention did not preempt the plaintiffs’ EU 261 claims based on the Seventh Circuit’s holding in Sompo Japan Ins., Inc. v. Nippon Cargo Airlines, Ltd., which has been interpreted by the district courts in the Northern District of Illinois as permitting claims for damages arising from delay so long as the claims do not conflict with the Montreal Convention. Finally, regarding Alitalia’s argument that the court should defer to the courts of the European Union to decide EU 261 claims, Judge Coleman found that Alitalia set forth no substantive reasons as to why a United States court should defer to another jurisdiction, particularly where Alitalia had not pointed to any parallel EU 261 proceedings in the European Union or argued that “any other jurisdiction claims an exclusive right to resolve” disputes arising under EU 261.
Two weeks after Judge Coleman issued her decision, Judge Nordberg issued his opinion in the Continental case and entered an order granting Continental’s motion to dismiss the plaintiffs’ direct cause of action for violation of EU 261. Judge Nordberg granted Continental’s motion based on Continental’s argument that EU 261 did not confer a private right of action that could be enforced by an individual in a United States court, an argument that Alitalia had not raised with Judge Coleman. Continental based its argument on EU 261’s express references to European Union “Member States” and the European Parliament’s and Commission’s intent to ensure uniform enforcement of EU 261 by limiting jurisdiction to courts in the European Union, which Continental further argued did not permit individual recoveries in “U.S.-style class action proceedings.” Notably, the plaintiffs relied on the same authority – the express language of the Regulation and the European Union’s legal framework – to oppose Continental’s motion by arguing that, when interpreted correctly, this authority permits the enforcement of EU 261 claims in United States courts. After weighing both sides’ arguments and recognizing that there was no authority directly on point, Judge Nordberg agreed with Continental’s interpretation of EU 261 and found that the European Union “did not clearly intend to authorize a private right of action under EU 261 to file claims in courts outside the EU.” In doing so, Judge Nordberg found that permitting the plaintiffs’ EU 261 claims to go forward in a class action proceeding could lead to different, conflicting results for U.S. and non-U.S. passengers whose claims arise out of the same flight, in that a United States court could find U.S. passengers eligible for EU 261 compensation whereas a European Union court or enforcement body could come to the opposite conclusion. Judge Nordberg found that such conflicting legal results would be inconsistent with the European Union’s intention to have EU 261 enforced in a uniform manner. Basing his decision solely on Continental’s argument that there is no private right of action to enforce EU 261 outside the European Union, Judge Nordberg did not consider Continental’s other grounds for dismissal, namely that the ADA and Montreal Convention preempted EU 261 claims. While Continental’s ADA and Montreal Convention arguments differed from Alitalia’s arguments, by declining to consider these alternative grounds, Judge Nordberg avoided producing a decision that could directly conflict with Judge Coleman’s decision.
With four motions to dismiss still pending in the Iberia, Lufthansa, Delta and United EU 261 class action cases, the issue of whether a claim for violation of EU 261 can be brought in the United States is far from resolved. It remains to be seen how much or how little the judges presiding over these cases will rely on the Alitalia and Continental decisions in coming to their own conclusions regarding the enforcement of EU 261 claims in the United States – particularly Judge Coleman who also will be determining Lufthansa’s motion to dismiss, in which Lufthansa argued that there is no private right of action under EU 261, as well as ADA preemption as grounds of dismissal. What is certain, however, is that this new body of law from the Northern District of Illinois will have great implications regarding a passenger’s ability to litigate EU 261 claims in the United States and, more broadly, an individual’s right to enforce foreign regulations in a United States class action proceeding.
1 Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004.
2 Gurevich v. Compagnia Aereas Italiana, SPA, d/b/a Alitalia Airlines, Case No. 11 C 1890, Order [Dkt No. 83] (N.D. Ill. Sept. 13, 2013).
3 Lozano v. Continental Airlines, Inc., Case No. 11 C 8258, Opinion and Order [Dkt No. 68] (N.D. Ill. Sept. 26, 2013).
4 Condon & Forsyth’s previous Client Bulletins and Newsletters on the topic of EU 261 are available at: https://condonlaw.com/publications.htm.
5 Giannopoulos v. Iberia, Líneas Aéreas de España, S.A., No. 11 C 775 (N.D. Ill. filed on Feb. 3, 2011); Polinovsky v. British Airways, PLC, No. 11 C 779 (N.D. Ill. filed on Feb. 3, 2011); Polinovsky v. Deutsche Lufthansa AG, No. 11 C 780 (N.D. Ill. filed on Feb. 3, 2011); Volodarskiy v. Delta Air Lines, Inc., No. 11 C 00782 (N.D. Ill. filed on Feb. 3, 2011); Bergman v. United Airlines, Inc., No. 12 C 7040 (N.D. Ill. filed on Sept. 4, 2012).
6 The United case was filed nearly twenty months after the six other EU 261 class actions were underway. The plaintiffs’ complaint against United did not state a claim for breach of contract.
7 49 U.S.C. § 41713(b)(1).
8 See Polinovsky v. British Airways PLC, 2012 WL 1506052 (N.D. Ill. Mar. 30, 2012) (Castillo, J.); Lozano v. Continental Airlines, Inc., 2012 WL 4094648 (N.D. Ill. Sept. 17, 2012) (Nordberg, J.); Volodarskiy v. Delta Air Lines, Inc., 2012 WL 5342709 (N.D. Ill. Oct. 29, 2012) (Chang, J.)