Nader v. Allegheny Airlines, Inc., 426 U.S. 290 (1976)

Nader v. Allegheny Airlines, Inc.

No. 75-455

Argued March 24, 1976
Decided June 7, 1976
426 U.S. 290

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Syllabus

Shortly before his scheduled departure from Washington, D.C. to Connecticut, where he was to fulfill speaking engagements, petitioner, who had reserved a seat on one of respondent’s Hartford flights arrived at the check-in area, but was advised that he could not be accommodated because all the seats were occupied. After refusing the tender of respondent, which concededly overbooked the flight, of denied boarding compensation, petitioner brought a common law action against respondent based on an alleged fraudulent misrepresentation arising from respondent’s failure to apprise petitioner of its deliberate overbooking practices, and a statutory action under § 404(b) of the Federal Aviation Act of 1958, arising from respondent’s failure to afford petitioner the boarding priority specified in its rules filed with the Civil Aeronautics Board (CAB). The District Court entered judgment and awarded compensatory and punitive damages on both claims. The Court of Appeals remanded petitioner’s statutory claim for further findings and reversed the award of punitive damages on that claim. The question of punitive damages for the common law claim was remanded for further findings on respondent’s good faith. None of that court’s foregoing rulings was presented in the petition for certiorari. The court also held that the common law fraudulent misrepresentation claim had to be remanded to the District Court, and stayed, under the principles of primary jurisdiction, pending referral to the CAB to determine whether the alleged failure to disclose the practice of deliberate overbooking is a deceptive practice under § 411 of the Act, which provides that the CAB may investigate and determine whether any air carrier has been or is engaged in unfair or deceptive practices, and that practices found to violate the section shall be the subject of a cease and desist order. The court held that a CAB determination that a practice is not deceptive under § 411 would preclude a common law tort action for damages for injuries caused by that practice.

Held: Petitioner’s common law tort action based on the alleged fraudulent misrepresentation by respondent air carrier should not be stayed pending reference to the CAB for a determination whether the practice is "deceptive" within the meaning of § 411 of the Act. Pp. 298-308.

(a) There is no irreconcilable conflict between the Act’s scheme and the common law remedy; both may coexist as contemplated by the Act’s saving clause, which provides that

[n]othing contained in this Act shall in any way abridge or alter the remedies now existing at common law or by statute, but the provisions of this Act are in addition to such remedies.

§ 1106. Texas & Pacific R. Co. v. Abilene Cotton Oil Co., 204 U.S. 426, distinguished. Pp. 298-300.

(b) No power to immunize a carrier from common law liability can be inferred from § 411’s language; where Congress has sought to confer such power, it has done so expressly, as in § 414 of the Act. Section 411 is both broader and narrower than common law remedies. A cease and desist order may issue thereunder if the CAB concludes that a carrier is engaged in an unfair or deceptive practice, and no findings that the practice was intentionally deceptive or has caused injury in fact are necessary; on the other hand, a CAB decision that such an order is inappropriate does not manifest the CAB’s approval of the practice, but may merely represent the agency’s conclusion that a more flexible approach is necessary. Pp. 300-303.

(c) The doctrine of primary jurisdiction, which has been applied where a claim originally cognizable in the courts requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative agency, is inapplicable here, where petitioner’s action for respondent’s asserted failure to disclose its overbooking practices implicates no tariff practice or similar technical question of fact uniquely within the CAB’s expertise. Pp. 303-307.

167 U.S.App.D.C. 350, 512 F.2d 527, reversed and remanded.

POWELL, J., delivered the opinion for a unanimous Court. WHITE, J., filed a concurring opinion, post, p. 308.