American Airlines, Inc. v. Wolens, 513 U.S. 219 (1995)

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OCTOBER TERM, 1994

Syllabus

AMERICAN AIRLINES, INC. v. WOLENS et al.

certiorari to the supreme court of illinois

No. 93-1286. Argued November 1, 1994—Decided January 18, 1995

In consolidated state-court class actions brought in Illinois, plaintiffs (respondents here), as participants in American Airlines' frequent flyer program, challenged American's retroactive changes in program terms and conditions—particularly, American's imposition of capacity controls (limits on seats available to passengers obtaining tickets with frequent flyer credits) and blackout dates (restrictions on dates such credits could be used). Plaintiffs alleged that application of these changes to mileage credits they had previously accumulated violated the Illinois Consumer Fraud and Deceptive Business Practices Act (Consumer Fraud Act or Act) and constituted a breach of contract. American answered that the Airline Deregulation Act of 1978 (ADA), 49 U. S. C. App. 1305(a)(1), preempted plaintiffs' claims. The ADA prohibits States from "enact-[ing] or enforc[ing] any law . . . or other provision having the force and effect of law relating to [air carrier] rates, routes, or services."

While the Illinois class-action litigation was sub judice, this Court decided Morales v. Trans World Airlines, Inc., 504 U. S. 374. Morales defined 1305(a)(1)'s "relating to" language to mean "having a connection with, or reference to, airline 'rates, routes, or services,' " id., at 384, and held that National Association of Attorneys General (NAAG) guidelines on airline fare advertising were preempted under that definition. The Illinois Supreme Court, post-Morales, ruled that plaintiffs' monetary claims survived for state-court adjudication. Those claims related only "tangential[ly]" or "tenuous[ly]" to "rates, routes, or services," the Illinois court reasoned, because frequent flyer programs are "peripheral," not "essential," to an airline's operation.

Held: The ADA's preemption prescription bars state-imposed regulation of air carriers, but allows room for court enforcement of contract terms set by the parties themselves. Pp. 226-235. (a) Morales does not countenance the Illinois Supreme Court's separation of "essential" operations from unessential programs. Plaintiffs' complaints, accordingly, state claims "relating to" air carrier "rates" (i. e., American's charges, in the form of mileage credits, for tickets and class-of-service upgrades) and "services" (i. e., access to flights and upgrades unlimited by retrospectively applied capacity controls and blackout dates). P. 226.

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