Cavalieri v. Avior Airlines C.A.

25 F.4th 843

Roberto Hung CAVALIERI, individually and on behalf of all others similarly situated, Sergio Enrique Isea, Plaintiffs-Appellants,

v.AVIOR AIRLINES C.A., a Venezuelan company, Defendant-Appellee.

No. 19-11330

United States Court of Appeals, Eleventh Circuit.

Filed: February 3, 2022

Charles M. Auslander, John G. Crabtree, Brian C. Tackenberg, Key Biscayne, FL, Milton Fuentes, M. Fuentes & Co., John Cody German, Cole Scott & Kissane, PA, Brian Michael Torres, Brian M. Torres, PA, Miami, FL, for Plaintiffs-Appellants.

Pedro A. Gonzalez, James Christopher Kellner, Sanchez-Medina Gonzalez Quesada Lage Gomez & Machado, LLP, Miami, FL, Geoffrey B. Marks, Law Offices of Geoffrey B. Marks, Coral Gables, FL, for Defendant-Appellee.

Before Wilson, Luck, and Lagoa, Circuit Judges.

PER CURIAM:

Plaintiffs Roberto Hung Cavalieri and Sergio Enrique Isea were passengers on airline flights operated by Defendant Avior Airlines, C.A. They brought this putative class action alleging that Defendant breached its Contract of Carriage by requiring passengers to pay a fee not disclosed in the Contract of Carriage. Passengers had to pay this additional fee, an $80 "Exit Fee," before they were allowed to board their departing flights from Miami to Venezuela. The district court dismissed Plaintiffs’ claim, concluding that the Airline Deregulation Act (ADA) preempted Plaintiffs’ breach of contract claim because it related to the price of the airline ticket and the ADA's preemption provision identifies actions relating to price as preempted. After careful review, we reverse the district court and remand for further proceedings. Plaintiffs’ breach of contract claim seeks merely to enforce the parties’ private agreements regarding the cost of passage and does not invoke state laws or regulations to alter the agreed-upon price. Accordingly, this breach of contract action falls within the category of cases protected from preemption by the Supreme Court's decision in American Airlines, Inc. v. Wolens , 513 U.S. 219, 115 S.Ct. 817, 130 L.Ed.2d 715 (1995).

I. BACKGROUND

As alleged in Plaintiffs’ second amended complaint, Plaintiffs purchased tickets for Defendant's commercial flights from Miami International Airport to Venezuela, entering into a contract with Defendant, the terms of which are reflected in Defendant's Contract of Carriage and the issued tickets. Plaintiff Hung purchased his ticket through Expedia.com for the "contract price of $775.50." The itinerary and receipt attached to the second amended complaint indicated that the price "include[d] taxes [and] fees." Plaintiff Isea purchased his ticket through a travel agent but did not allege the price paid or attach a ticket or receipt to the second amended complaint. Plaintiffs allege that their ticket price reflected the "fully-paid contract" and that Defendant failed to sufficiently disclose any other fees required for passage. However, when checking in for their flights at the airport, Defendant informed Plaintiffs that they had to pay an additional $80 "Exit Fee" before being allowed to board their flights.

Plaintiffs deemed the Exit Fee "extra-contractual" and filed a single-count, breach of contract putative class action against Defendant in the United States District Court for the Southern District of Florida. Plaintiffs contended that by requiring them, and other ticketed passengers, to pay an additional $80 charge in order to board their ticketed flights, Defendant breached its contracts with Plaintiffs and its other passengers—specifically the price terms set forth on their tickets as authorized by Defendant's Contract of Carriage.

Defendant filed a motion to dismiss Plaintiffs’ second amended complaint.¹ Defendant raised at least five grounds for dismissal, including that Plaintiffs failed to state a plausible breach of contract claim. Defendant argued that Plaintiffs failed to disclose the entire contract, which it maintained included terms on its website that permitted charging of the "Exit Fee." Defendant also asserted that the ADA preempted Plaintiffs’ breach of contract claim because it constituted an improper attempt to regulate air carrier pricing in contravention of the ADA.

The magistrate judge issued a report and recommendation ruling only on Defendant's ADA preemption argument. The magistrate judge found Plaintiffs’ state law breach of contract claim preempted by the ADA and not excepted under the Supreme Court's decision in Wolens . Wolens excepted from preemption a breach of contract claim stemming from the terms of a frequent flier program because the allegedly breached terms arose from a self-imposed undertaking, rather than state-imposed obligations. Wolens , 513 U.S. at 228–29, 115 S.Ct. 817. The magistrate judge concluded that Plaintiffs’ claim was related to prices, routes, and services, which is the province of the Act. Relying on the Ninth Circuit's decision in Sanchez v. Aerovias De Mexico, S.A. De C.V. , 590 F.3d 1027 (9th Cir. 2010), the magistrate judge further found that Wolens did not except Plaintiffs’ claim from preemption because Plaintiffs’ second amended complaint failed to identify a voluntary contractual undertaking that created an obligation to disclose the Exit Fee. Accordingly, the magistrate judge recommended that Plaintiffs’ claim be dismissed with prejudice.

The district court adopted the magistrate judge's report and recommendation. The district court found Plaintiffs’ claim alleging breach of contract by Defendant's imposition of additional undisclosed fees preempted by the ADA, and not subject to a Wolens exception, "because by its very terms the airline ticket receipt refers to the price of the airline ticket." The district court concluded, "[u]nlike in Wolens , where the Supreme Court excepted the breach of contract stemming from the frequent flier program, the express terms of the violated provision in this case expressly relate to pricing, and the claim is therefore, preempted." The district court rejected Plaintiffs’ argument that the preemption doctrine permits breach of contract actions relating to price when there is no attempt to enforce a state law or regulation to alter the agreed-upon price, as "inconsistent with the Act, which was enacted to foster competition among airlines." The district court dismissed Plaintiffs’ case with prejudice because Plaintiffs were "unable to amend their complaint in a manner that would avoid ... preemption."

II. DISCUSSION

Plaintiffs appeal the district court's dismissal of their second amended complaint, arguing that Wolens protects their breach of contract claim from preemption by the Airline Deregulation Act. Defendant maintains that dismissal should be affirmed on preemption grounds, or alternatively, on the ground that Plaintiffs failed to state a plausible breach of contract claim. First, we discuss whether the parties are diverse citizens sufficient for the purpose of establishing jurisdiction. Next, we turn to the issue of preemption. Lastly, we address Defendant's argument that Plaintiffs’ cause of action was not sufficiently pled.

A. Standard of Review

"We review preemption determinations de novo." Bailey v. Rocky Mountain Holdings, LLC , 889 F.3d 1259, 1266 (11th Cir. 2018). We review the district court's ruling on Defendant's motion to dismiss de novo, accepting the allegations in Plaintiffs’ second amended complaint as true and construing them in the light most favorable to Plaintiffs. Isaiah v. JPMorgan Chase Bank , 960 F.3d 1296, 1301–02 (11th Cir. 2020). "To survive a Rule 12(b)(6) motion to dismiss, a complaint must plead ‘enough facts to state a claim to relief that is plausible on its face.’ " Ray v. Spirit Airlines, Inc. , 836 F.3d 1340, 1347–48 (11th Cir. 2016) (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009).

B. Plaintiffs Have Sufficiently Alleged Diversity Between the Unnamed Putative Class Members and the Defendants

The parties were asked to discuss whether the Plaintiffs sufficiently alleged minimal diversity for the purpose of establishing jurisdiction. "A federal court not only has the power but also the obligation at any time to inquire into jurisdiction whenever the possibility that jurisdiction does not exist arises." Johansen v. Combustion Eng'g, Inc ., 170 F.3d 1320, 1328 n.4 (11th Cir. 1999). And we review jurisdictional issues de novo. In re Walker, 515 F.3d 1204, 1210 (11th Cir. 2008).

Plaintiffs alleged in their second amended complaint that "as a national class at least one class member (as well as the Plaintiffs) belong to a different state than that of the Airline[.]" Plaintiffs defined their national class as "all persons that Avior charged an Exit Fee, from five years prior to the filing of the initial complaint through the earlier of: (i) the date, if any, Avior changes its contract to expressly include Exit Fees; and (ii) the date of class certification." Both Plaintiffs Cavalieri and Isea are citizens of Venezuela but Isea is additionally a legal permanent resident of the United States domiciled in Florida. Defendant Avior is a Venezuelan airline with its principal place of business in Venezuela.

Plaintiffs alleged that the parties are minimally diverse under the Class Action Fairness Act (CAFA), codified as 28 U.S.C. § 1332(d). Plaintiffs alleged that they established jurisdiction under 28 U.S.C. § 1332(d)(2)(C) because they satisfy the requirement therein that "any member of a class of plaintiffs is a citizen of a State and any defendant is a foreign state or a citizen or subject of a foreign state." CAFA also requires that the class action concern an amount in controversy in excess of $5 million and comprise at least 100 class members. 28...