In Re Korean Air Lines Co., Ltd.
642 F.3d 685
| 9th Cir. | 2011Background
- Plaintiffs allege indirect-purchaser price-fixing on Korean Air and Asiana tickets in MDL No. 1891.
- District court dismissed California state claims as preempted by the Airline Deregulation Act (ADA).
- Court denied leave to amend to reassert federal Sherman Act claims and effectively ended the case.
- MDL procedures divided indirect and direct purchaser actions; indirects framed under state law only for pretrial purposes.
- Appeal challenges ADA preemption, denial of leave to amend, and interlocutory case-management orders in MDL.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| ADA preemption scope includes foreign carriers | ADA preempts state regs against all air carriers. | ADA preemption applies only to domestic carriers. | ADA preempts state regulation of all air carriers, domestic and foreign. |
| Whether state claims are 'related to a price' of air transportation | California claims relate to pricing of air transportation. | Claims not related to price are not preempted. | State price-related claims are preempted under ADA § 41713(b)(1). |
| Right to amend to reinstate federal Sherman Act claims | District court misapplied MDL CMO; leave to amend should be granted. | MDL orders control pretrial setup; amendments foreclosed. | District court abused discretion; remanded to evaluate amendment under proper standard. |
| Reviewability of MDL case-management orders on appeal | CMOs affect rights and should be reviewable. | CMOs are non-final, interlocutory and generally not reviewable. | CMOs are interlocutory; appellate review limited pending final judgments. |
Key Cases Cited
- Morales v. Trans World Airlines, Inc., 504 U.S. 374 (1992) (preemption extends to state claims against air carriers)
- Rowe v. New Hampshire Motor Transp'n Ass'n, 552 U.S. 364 (2008) (state-law 'relate to' preemption not constrained by ERISA precedent)
- Read-Rite Corp. v. Burlington Air Express, Ltd., 186 F.3d 1190 (9th Cir.1999) (state claims preempted against foreign air carrier)
- Buck v. American Airlines, Inc., 476 F.3d 29 (1st Cir.2007) (preemption of state claims against foreign air carriers)