Civil rights.

• Author: Gallagher, John A.
• Position: Safety standards in commercial aviation

First Circuit Incorrectly Adopts Arbitrary-or-Capricious Standard for Reviewing Airliner's Decision to Remove Passengers--Cerqueira v. American Airlines, Inc., 520 F.3d 1 (1st Cir. 2008), cert. denied, 129 S. Ct. 111 (2008)

In response to increasing acts of piracy on commercial airlines, Congress enacted the Federal Aviation Act (FAA), which established regulations to improve and maintain safety standards in commercial aviation. (1) Although the FAA includes an anti-discrimination provision, section 44902(b) of the Act grants air carriers broad discretion to refuse transportation to any passenger a "carrier decides is, or might be inimical to safety." (2) In Cerqueira v. American Airlines, Inc., (3) the Court of Appeals for the First Circuit, in a case of first impression, considered the proper standard for a passenger's discrimination claim against an air carrier that relies on the protection under section 44902(b) to refuse passengers transportation. (4) The First Circuit held that the plaintiff passenger must show the air carrier's decision to refuse transportation and rebooking is arbitrary or capricious based on the information known to the decision-maker at the time of the refusal. (5)

On December 28, 2003, John D. Cerqueira planned to fly from Boston to Fort Lauderdale on American Airlines (AA) flight 2237. (6) Prior to boarding, the captain had a disturbing conversation in the terminal with an Israeli passenger, who later appeared to be Cerqueira's flying companion. (7) Later, in the gate area, Cerqueira showed hostility toward a flight attendant while requesting an exit-row seat, then boarded the plane early, going immediately to the restroom for an extended period of time. (8) In addition, the two Israeli passengers who appeared to be traveling with Cerqueira acted suspiciously during the safety presentation. (9) Based on these events, along with other passengers' discomfort with these men, the captain decided to remove Cerqueira and the two Israeli passengers from the plane. (10)

After removal, the state police questioned Cerqueira and the two Israeli passengers for over two hours. (11) During this time, the captain called the AA's systems operations control (SOC) manager in Dallas and gave him a full report of the morning's events. (12) After the police released him, Cerqueira attempted to rebook a later AA flight, but the SOC manager denied Cerqueira's rebooking. (13) In the fall of 2004, Cerqueira filed a complaint with the Massachusetts Commission Against Discrimination (MCAD), and after the MCAD determined he had a valid claim, he brought suit in the United States District Court for the District of Massachusetts in 2005. (14)

After trial in district court, the jury returned a verdict for Cerqueira and awarded him compensatory damages of $130,000 and punitive damages of $270,000. (15) AA then filed a motion for judgment notwithstanding the verdict and a motion for a new trial. (16) The district court denied both motions and rejected AA's argument that Cerqueira failed to produce sufficient evidence of intentional discrimination pursuant to 49 U.S.C. [section] 44902(b). (17) Although the district court found the arbitrary-or-capricious standard applied to claims involving section 49902(b), the court also held that the failure to give an explicit instruction respecting this standard was not a prejudicial error. (18) On appeal, however, the First Circuit reversed and remanded the case with instructions to vacate the judgment after concluding that no properly instructed jury could return a verdict against AA. (19)

For more than seven decades, terrorist attacks have wreaked havoc on commercial aviation throughout the world. (20) Since the first hijacking of a U.S. commercial aircraft in 1961, the federal government has passed a surplus of laws designed to combat aerial terrorism. (21) Unfortunately, as a result of the terrorist attacks on September 11, 2001, air carriers increasingly rely upon authority derived from 49 U.S.C. [section] 44902(b) to refuse passenger transportation due to security concerns, some of which are unfounded. (22) In turn, passengers object to the refusals as racially motivated and rely upon civil-rights protections granted by another federal statute, 42 U.S.C. [section] 1981. (23) Discrimination claims brought by passengers raise important public-policy concerns regarding the intersection of aviation security and civil rights. (24)

The proper legal standard for passenger claims of air-carrier discrimination is the subject of considerable dispute. (25) Normally, claims filed pursuant to section 1981 are for employment discrimination, and courts consistently analyze these claims by applying the McDonnell Douglas test. (26) Under the McDonnell Douglas test, first announced in McDonnell Douglas Corp. v. Green, (27) the plaintiff has the initial burden of establishing a prima facie case of discrimination. (28) Once that burden is established, the burden shifts to the defendant to articulate a "legitimate, nondiscriminatory reason" for its adverse action. (29) If the defendant meets this burden, the burden shifts back to the plaintiff to show the stated reason was mere pretext, or a "coverup for a racially discriminatory decision." (30)

It is well-settled that a plaintiff may bring a claim against an airline under section 1981 for racial discrimination in making and enforcing private contracts. (31) Outside of the employment context, a majority of federal courts consistently apply the arbitrary-or-capricious standard to discrimination claims against air carriers rather than the McDonnell Douglas test. (32) Most notably, in Williams v. Trans World Airlines, (33) the Second Circuit held that the FAA permissive refusal authority under section 44902(b) overrides the protections of section 1981 and grants air carriers broad authority in refusing to transport passengers for security reasons, unless the decision is proven to be arbitrary or capricious. (34) Similarly, the Ninth Circuit in Cordero v. Cia Mexicana de Aviacion, (35) adopted the Williams court's reasoning in requiring airlines denial of transportation of passengers to be reasonable. (36) When applying the arbitrary-or-capricious standard, courts review the facts and circumstances known to the air carrier at the time of the decision to refuse passage. (37) The majority of federal courts have held that the arbitrary-or-capricious standard is best suited to reconcile the conflicting policy concerns of safety in commercial aviation and the right to be free from racial discrimination. (38)

In Cerqueira v. American Airlines, Inc., the First Circuit vacated the plaintiff's jury verdict and held "no properly instructed jury could return a verdict against the air carrier." (39) Relying on the reasoning and standards established in Williams, and later adopted in Cordero, the First Circuit held an air carrier is immune from liability stemming from its decision to refuse to transport a passenger, unless that decision is arbitrary or capricious. (40) In doing so, the First Circuit aligned with the Second and Ninth Circuits in rejecting the McDonnell Douglas burden-shifting analysis in favor of the arbitrary-or-capricious standard for section 1981 claims against air carriers. (41) The court determined that Congress did not intend section 1981 to "limit or to render inoperative" the permissive refusal rights granted air carriers under section 44902(b). (42)

In addition to adopting the arbitrary-or-capricious standard, the First Circuit established four guiding principles for evaluating an air carrier's refusal to transport under section 44902(b). (43) First, the captain's decision to refuse transportation is equated with a decision by the air carrier. (44) Second, a review of the captain's decision to refuse transportation is limited to the information "actually known by the decisionmaker at the time of the decision." (45) Third, the decision-maker is "entitled to accept at face value the representations made to him by other air carrier employees." (46) Fourth, the prejudices of air carrier personnel other than the decision-maker are not imputed to the decision-maker. (47) In light of these principles, the First...