American Airlines Inc v. Travelport Limited et al

Filing 195

RESPONSE filed by Sabre Holdings Corporation, Sabre Inc, Sabre Travel International Ltd re: #162 MOTION for Reconsideration re #156 Order on Motion to Dismiss. (Fredricks, Scott) Modified filers on 1/20/2012 (klm).

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION
AMERICAN AIRLINES, INC.
CIVIL ACTION NO. 4:11-CV-244-Y

VS.
TRAVELPORT LIMITED, et al.

Sabre’s Response in Opposition to American Airline’s
Motion for Reconsideration of the Court’s November 21, 2011 Order

Table of Contents
I.

Reconsideration is Warranted Only for Compelling Reasons ............................................... 1

II.

Count 4: AA Concedes It Did Not Plead Substantial Foreclosure and Simply
Asks for Yet Another “Do Over”........................................................................................... 3

III.

Count 5 and 6: The Court Properly Ruled that the ADA Preempts AA‟s State
Law Claims ............................................................................................................................ 7

i

TABLE OF AUTHORITIES
Federal Cases
Abdu-Brisson v. Delta Air Lines, Inc.,
927 F. Supp. 109 (S.D.N.Y. 1996) .........................................................................

8

Alaska Airlines Inc. v. Carey,
395 Fed. App‟x 476 (9th Cir. 2010) .......................................................................

13

All World Prof’l Travel Servs., Inc. v. Am. Airlines, Inc.,
282 F. Supp. 2d 1161 (C.D. Cal. 2003) ..................................................................

8

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

13

Carroll v. Fort James Corp.,
470 F.3d 1171 (5th Cir. 2006) .................................................................................

4

Chrissafis v. Continental Airlines,
940 F. Supp. 1292 (N.D. Ill. 1996) .........................................................................

8

Continental Airlines, Inc. v. Am. Airlines, Inc.,
824 F. Supp. 689 (S.D. Tex. 1993) .........................................................................

9

Dos Santos v. Bell Helicopter Textron, Inc.,
651 F. Supp. 2d 550 (N.D.Tex. 2009) ....................................................................

2, 8

Edward H. Bohlin Co. v. Banning Co.,
6 F.3d 350 (5th Cir.1993) .......................................................................................

1

Estate of Gaither ex rel. Gaither v. District of Columbia,
771 F. Supp. 2d 5 (D.D.C. 2011) ............................................................................

7

Forman v. Davis,
371 U.S. 178 (1962) ................................................................................................

3

Freeman v. Continental Gin Co.,
381 F.2d 459 (5th Cir. 1967) ..................................................................................

4

Frontier Airlines, Inc. v. United Airlines, Inc.,
758 F. Supp. 1399 (D. Colo. 1989) .........................................................................

11

Galileo Int’l, L.L.C. v. Ryanair, Ltd.,
Case No. 01 C 2210, 2002 U.S. Dist. LEXIS 3317 (N.D. Ill. Feb. 27, 2002) ........

12

Ginsberg v. Northwest, Inc.,
653 F.3d 1033 (9th Cir. 2011) ................................................................................

12-13

ii

Gregory v. Mitchell,
634 F.2d 199 (5th Cir. 1981) ..................................................................................

4

In re Bank of Louisiana/Kenwin Shops Inc., Contract Litigation,
1999 WL 518852 (E.D. La. 1999) ..........................................................................

2

J&J Sports Productions, Inc. v. Tawil,
2009 WL 5195892 (W.D. Tex. 1999) .....................................................................

1-2

Livingston Downs Racing Ass'n, Inc. v. Jefferson Downs Corp.,
259 F. Supp. 2d 471 (M.D. La. 2002) .....................................................................

2

Lyn-Lea Travel Corp. v. Am. Airlines, Inc.,
283 F.3d 282 (5th Cir. 2002) ..................................................................................

9, 11

Manassas Travel, Inc. v. Worldspan, L.P.,
Case No. 2:07-CV-701-TC, 2008 U.S. Dist. LEXIS 35217,
(D. Utah Apr. 30, 2008) ..........................................................................................

12

Mason v. T.K. Stanley, Inc.,
2006 WL 1365411 (S.D. Miss. 2006) .....................................................................

2

Mayeaux v. Louisiana Health Services & Indem. Co.,
376 F. 3d 420 (5th Cir. 2004) .................................................................................

4

Mitsubishi Aircraft Intern., Inc. v. Brady,
780 F.2d 1199 (5th Cir. 1986) ................................................................................

4

Morales v. TWA,
504 U.S. 374 (1992) ................................................................................................

9

Official Committee v. Coopers & Lybrand,
322 F.3d 148 (2d Cir. 2003)....................................................................................

1

Perforaciones Maritimas Mexicanas S.A. de C.V. v. Seacor Holdings, Inc.,
2008 WL 7627805 (S.D. Tex. 2008) ......................................................................

2

Ross v. Marshall,
426 F.3d 745 (5th Cir. 2005) ..................................................................................

2

Rotella v. Mid-Continent Cas. Co.,
2010 WL 1330449 (N.D. Tex. 2010) ......................................................................

2

Roy B. Taylor Sales, Inc. v. Hollymatic Corp.,
28 F.3d 1379 (5th Cir. 1994) ..................................................................................

4

iii

Schiller v. Physicians Resource Group Inc.,
342 F.3d 563 (5th Cir. 2003) ..................................................................................

7

Shell Global Solutions (US), Inc. v. RMS Engineering, Inc.,
782 F. Supp. 2d 317 (S.D. Tex. 2011) ....................................................................

2, 7

Singh v. George Washington University,
383 F. Supp. 2d 99 (D.D.C. 2005) ..........................................................................

1

Smith v. Ayres,
845 F.2d 1360 (5th Cir. 1988) ................................................................................

4

Smith v. EMC Corp.,
393 F.3d 590 (5th Cir. 2004) ..................................................................................

4

Tampa Elec. Co. v. Nashville Coal Co.,
365 U.S. 320 (1961) ................................................................................................

4

Teal v. Eagle Fleet, Inc.,
933 F.2d 341 (5th Cir.1991) ...................................................................................

2-3

Templet v. HydroChem Inc.,
367 F.3d 473 (5th Cir. 2004) ..................................................................................

2

Travel All Over the World, Inc. v. Kingdom of Saudi Arabia,
73 F.3d 1423 (7th Cir. 1996) ..................................................................................

8

Trujillo v. Am. Airlines, Inc.,
938 F. Supp. 392 (N.D. Tex. 1995) ........................................................................

12

Union Planters Nat. Leasing v. Woods,
687 F.2d 117 (5th Cir. 1982) ..................................................................................

4

United Airlines, Inc. v. Gregory,
716 F. Supp. 2d 79 (D. Mass. 2010) .......................................................................

13

United Airlines, Inc. v. Mesa Airlines, Inc.,
219 F.3d 605 (7th Cir. 2000) ..................................................................................

8

State Cases
Continental Airlines v. Kiefer,
920 S.W.2d 274 (Tex. 1996) ...................................................................................

8, 13

Delta Airlines v. Black,
116 S.W.3d 745 (Tex. 2003) ...................................................................................

8

iv

Frequent Flyer Depot, Inc. v. Am. Airlines, Inc.,
281 S.W.3d 215 (Tex. App.—Fort Worth 2009, pet. denied) ................................

13

Kneuss v. Ritenour,
No. 2001AP110097, 2002 WL 31518175 (Ohio App. Nov. 6, 2002) ....................

12

Federal Statutes
49 U.S.C. § 41713(b) ..........................................................................................................

7 - 10

49 U.S.C. § 41712(a) ..........................................................................................................

10

v

The Court should deny American Airlines‟ (“AA”) motion to reconsider the Court‟s
dismissal of Counts 4, 5, and 6 of AA‟s First Amended Complaint. In Count 4, AA alleged that
Sabre‟s contracts with airlines and travel agents unreasonably restrained trade in violation of
Section 1of the Sherman Act, 15 U.S.C. § 1. This Court dismissed Count 4 for failing to allege
substantial foreclosure. Prior to dismissal, AA had two opportunities to plead foreclosure but
instead chose to argue foreclosure was not relevant. AA should not get a third try. The Court
dismissed on preemption grounds Counts 5 and 6, which sought to assert state law tort causes of
action. As to those counts, AA simply seeks to articulate new arguments against preemption,
which is improper on a motion for reconsideration. In any event, AA is wrong on the merits: the
Court‟s holding is correct and entirely consistent with precedent.
I.

Reconsideration is Warranted Only for Compelling Reasons
To prevail on a motion for reconsideration, the moving party must provide compelling

reasons. Otherwise, litigation goes on without end and the overriding interest in finality and
avoiding imposing unwarranted costs and delay on the court and other parties is undermined.
See Official Committee v. Coopers & Lybrand, 322 F.3d 148, 167 (2d Cir. 2003) (“We have
limited district courts‟ reconsideration of earlier decisions under Rule 54(b) by treating those
decisions as law of the case, which gives a district court discretion to revisit earlier rulings in the
same case, subject to the caveat that „where litigants have once battled for the court‟s decision,
they should neither be required, nor without good reason permitted, to battle for it again.‟”);
Singh v. George Washington University, 383 F. Supp. 2d 99, 101-02 (D.D.C. 2005) (quoting
Coopers & Lybrand and adding that “[t]he sure and speedy administration of justice requires no
less”); see also Edward H. Bohlin Co. v. Banning Co., 6 F.3d 350, 355 (5th Cir. 1993) (stating
that courts must “strike the proper balance” between “finality” and “render[ing] just decisions on
the basis of all the facts.”). Accordingly, district courts in this circuit have held that motions for
1

reconsideration should only be granted for strong reasons — not present here — such as to
correct an obvious and plain legal error or the discovery of new evidence. See, e.g., J&J Sports
Productions, Inc. v. Tawil, 2009 WL 5195892, *2 (W.D. Tex. 2009) (requiring the movant show
“the need to correct a clear or manifest error of law or fact or to prevent a manifest injustice”);
Perforaciones Maritimas Mexicanas S.A. de C.V. v. Seacor Holdings, Inc., 2008 WL 7627805,
*1 (S.D. Tex. 2008) (holding that a Rule 54(b) motion must „“clearly establish either a manifest
error of law or fact or must present newly discovered evidence”) (citing Ross v. Marshall, 426
F.3d 745, 763 (5th Cir. 2005)).
The standards under Rule 59(e) for motions to alter or amend a final judgment and under
Rule 60(b) for motions for relief from judgment are also relevant. This Court has held that Rules
59 and 60 should “inform” the Rule 54 analysis, although the standard under Rule 54 may be
somewhat “less exacting.” Dos Santos v. Bell Helicopter Textron, Inc., 651 F. Supp. 2d 550, 553
(N.D.Tex. 2009) (Means, J.). Others courts too have looked to these other rules in this context.1
For Rule 59(e), the Fifth Circuit has explained that a motion to alter or amend a final judgment is
an “extraordinary remedy that should be used sparingly” only to correct a “manifest error of law
or mistake of fact” and has emphasized that “a judgment should not be set aside except for
substantial reasons.” Templet v. HydroChem Inc., 367 F.3d 473, 479 (5th Cir. 2004). For Rule
60(b), the moving party must establish “(1) mistake, inadvertence, surprise, or excusable neglect;
(2) newly discovered evidence…; (3) fraud…; (4) the judgment is void; (5) the judgment has
1

Limiting the list only to district courts in this circuit, some of the examples include
Livingston Downs Racing Ass'n, Inc. v. Jefferson Downs Corp., 259 F. Supp. 2d 471 (M.D. La.
2002) (looking to Rule 59(e)); Shell Global Solutions (US), Inc. v. RMS Engineering, Inc., 782 F.
Supp. 2d 317 (S.D. Tex. 2011) (applying Rule 59(e) standards); Rotella v. Mid-Continent Cas.
Co., 2010 WL 1330449 (N.D. Tex. 2010) (approvingly citing Dos Santos on this issue); Mason
v. T.K. Stanley, Inc., 2006 WL 1365411 (S.D. Miss. 2006) (looking to Rule 59(e)); and In re
Bank of Louisiana/Kenwin Shops Inc., Contract Litigation, 1999 WL 518852 (E.D. La. 1999)
(applying Rule 60 standards).

2

been satisfied, released or discharged; or (6) any other reason justifying relief for the operation of
the judgment.” Teal v. Eagle Fleet, Inc., 933 F.2d 341, 347 (5th Cir. 1991).
Whatever the precise formulation of the standard, none of AA‟s arguments come
remotely close to satisfying it. As detailed below for each count, AA has not shown that the
Court committed any error, much less clear error. Nor has AA shown that it will suffer a
manifest injustice; indeed, whether AA will suffer at all is doubtful. AA also does not offer new
law or facts, much less significant ones.
II.

Count 4: AA Concedes It Did Not Plead Substantial Foreclosure and Simply Asks
for Yet Another “Do Over”
This Court dismissed AA‟s Count 4 because AA failed to plead substantial foreclosure of

the alleged market and failed to identify with sufficient particularity the agreements it seeks to
challenge. (Order on Mot. to Dismiss, Dkt. 156, Nov. 21, 2011, at 31-32). AA does not dispute
that pleading substantial foreclosure is required to state a claim.2 AA‟s only argument for
reconsideration is that the Court dismissed Count 4 with prejudice; it says that the Court should
have dismissed without prejudice and given AA a third attempt to amend its pleadings to actually
plead substantial foreclosure.
Courts often deny leave to amend in these circumstances. See, e.g., Forman v. Davis,
371 U.S. 178, 182 (1962) (explaining that a court may deny leave for reasons including “undue
delay, bad faith or dilatory motive … repeated failure to cure deficiencies … undue prejudice …
[and] futility”); Carroll v. Fort James Corp., 470 F.3d 1171, 1175 (5th Cir. 2006) (affirming
denial of leave given prior failures to state a claim); Smith v. EMC Corp., 393 F.3d 590, 595-96

2

AA does argue that the Court erred on two subsidiary points, specifically that the Court
erred in holding (1) “American cannot establish substantial foreclosure by aggregating the
market shares of the travel agencies with which each GDS had anticompetitive agreements” (AA
Mot. For Reconsideration, Dkt. 162, Dec. 19, 2911, at 7); and (2) AA‟s “contract with Sabre
could not provide the requisite agreement needed to establish a violation of section 1of the
3

(5th Cir. 2004) (affirming denial of leave for undue delay and noting that the plaintiff could have
pled claims earlier); Mayeaux v. Louisiana Health Services & Indem. Co., 376 F. 3d 420, 427
(5th Cir. 2004) (affirming denial of leave when amendment was “„untimely‟ in light of the
procedural history and posture of the case”); Smith v. Ayres, 845 F.2d 1360 (5th Cir. 1988)
(affirming denial of leave given continued deficiencies); Mitsubishi Aircraft Intern., Inc. v.
Brady, 780 F.2d 1199, 1203 (5th Cir. 1986) (affirming denial of leave when failure to plead the
claim earlier “strongly suggests either a lack of diligence on [the plaintiff‟s] part or a lack of
sincerity”); Union Planters Nat. Leasing v. Woods, 687 F.2d 117, 121 (5th Cir. 1982)
(“[M]eaningful consideration should be accorded the proposition that all litigation must have a
timely termination.”); Gregory v. Mitchell, 634 F.2d 199, 203 (5th Cir. 1981) (affirming denial
of leave as “untimely” after motions to dismiss, or in the alternative summary judgment, were
taken under advisement); Freeman v. Continental Gin Co., 381 F.2d 459, 469 (5th Cir. 1967)
(“Liberality in amendment is important to assure a party a fair opportunity to present his claims
and defenses, but „equal attention should be given to the proposition that there must be an end
finally to a particular litigation.‟”).
Here, AA had ample opportunity to set forth sufficient foreclosure allegations. AA has
already filed two amended complaints, neither of which adequately alleged foreclosure. (AA
First Am. Compl., Dkt. 52, Jun. 1, 2011; AA Second Am. Compl., Dkt. 159, Dec. 5, 2011). The
need to show substantial foreclosure to have a valid Sherman Act, Section 1 claim such as AA‟s
Count 4 is well-established by Supreme Court and Fifth Circuit precedent, see, e.g., Tampa Elec.
Co. v. Nashville Coal Co., 365 U.S. 320, 328-29 (1961); Roy B. Taylor Sales, Inc. v. Hollymatic
Corp., 28 F.3d 1379, 1386 (5th Cir. 1994), and so AA must have known it needed to plead
substantial foreclosure. The Court need not be solicitous toward AA on this point either: AA is

4

represented by experienced antitrust counsel who undoubtedly know that substantial foreclosure
is required for this sort of claim.
Moreover, Sabre‟s motion to dismiss described in detail the legal requirement that AA
must show substantial foreclosure and why AA‟s pleadings failed to meet that standard. (See
Sabre Mem. ISO Mot. to Dismiss, Dkt. 97, Jul. 13, 2011, at 17-21). AA‟s most recent amended
complaint post-dated Sabre‟s motion to dismiss by over three months, yet still failed to address
these deficiencies. (Sabre filed its motion to dismiss on July 13, 2011 (Dkt. 97), and AA filed a
motion for leave to file its second amended complaint, including a copy of that complaint, on
Oct. 20, 2011 (Dkt. 148).)
Even worse, AA did not actually file its most recent inadequate complaint until two
weeks after the Court‟s ruling on the motion to dismiss and therefore had ample opportunity to
plead whatever additional facts it wanted. (See Order on Mot. to Dismiss, Dkt. 156, Nov. 21,
2011; AA Second Am. Compl., Dkt. 159, Dec. 5, 2011). This filing triggered a second set of
motions to dismiss, which are pending. (E.g., Sabre Partial Mot. to Dismiss, Dkt. 163, Dec. 22,
2011). Were the Court to grant AA‟s motion, there would likely be yet another round of motion
to dismiss briefing, all to the prejudice of this Court and Sabre. In any event, any conceivable
justification for AA‟s delay was lost when AA filed its second amended complaint without
curing the deficiencies in its foreclosure allegations that the Court identified in dismissing Count
4.
AA also cannot plausibly argue that it was missing any facts it needed to plead
substantial foreclosure at the time it filed either of its amended complaints. AA‟s motion does
not point to any new facts AA has now but did not have previously. Nor could AA plausibly say
it lacked the facts it needed: AA first sued Sabre in state court in January 2011, and by the time

5

AA filed its motion for leave to file a second amended complaint in this Court in October 2011,
Sabre had produced hundreds of thousands of pages of material to AA. Indeed, the entire
premise of AA‟s motion for leave was that AA should be allowed to add new claims based on
the discovery it had received from Sabre. (AA Mot. for Leave to File Second Am. Compl., Dkt.
148, Oct. 20, 2011, at 2.) Moreover, AA plainly had sufficient facts to allege substantial
foreclosure by the time it actually filed its second amended complaint on Dec. 5, 2011, as its
motion for reconsideration was filed a mere two weeks later, on Dec. 19, 2011. (AA Second Am.
Compl., Dkt. 159, Dec. 5, 2011; AA Mot. for Reconsideration, Dkt. 162, Dec. 19, 2011.)
Finally, the Court should be mindful of the fact that AA‟s claims regarding the same
conduct under Section 2 of the Sherman Act, 15 U.S.C. § 2, remain before this Court. AA has
also brought monopolization claims against Sabre based on the same conduct in Texas state court
under the guise of the Texas antitrust law. AA has successfully resisted Sabre‟s attempt to
remove the state case to federal court so that it might be consolidated with the claims pending
before this Court. Thus, the dismissal of Count 4 will not deprive AA of a chance to make its
case; far from it — AA still has not just one, but two chances to attack Sabre in both federal and
state court for the same conduct.
Given all of these circumstances, the Court plainly acted well within its discretion in
dismissing Count 4 with prejudice. Sabre also incorporates by reference the reasons detailed in
Travelport‟s briefing why further amendment by AA would be futile and prejudicial to the
defendants. (Travelport Resp. to AA‟s Mot. for Reconsideration, Dkt. 182, Jan. 9, 2012, at 5-9.)

6

III.

Count 5 and 6: The Court Properly Ruled that the ADA Preempts AA’s State Law
Claims
AA asks the Court to reverse or “withdraw” its ruling that the Airline Deregulation Act

(“ADA”), 49 U.S.C. § 41713(b), preempts AA‟s state law tortious interference claims (Counts 5
and 6). (Order on Mot. to Dismiss, Dkt. 156, Nov. 21, 2011, at 34, 36). AA‟s request is nothing
more than its latest attempt to forum-shop this dispute: AA is trying to avoid the impact of this
Court‟s ruling on similar claims it has brought against Sabre that are pending in state court.
Indeed, AA admits it no longer wants to pursue these claims in federal court. (AA Mot. for
Reconsideration, Dkt. 162, Dec. 19, 2011, at 15-16.)
AA‟s motion for reconsideration of Courts 5 and 6 should be denied for three reasons.
First, AA could have, but did not, raise its new preemption arguments in response to the motions
to dismiss, and a motion for reconsideration “cannot be used to raise arguments which could, and
should, have been made before.” Shell Global Solutions (US) Inc., 782 F. Supp. 2d at 358 (citing
Schiller v. Physicians Resource Group Inc., 342 F.3d 563, 567 (5th Cir. 2003)). In response to
the defendants‟ motions to dismiss, AA argued that ADA preemption does not apply to “statelaw tort claims … brought to enforce legitimate contracts.” (AA Resp. to Travelport Mot. to
Dismiss, Dkt. 107, Jul. 18, 2011, at 23; AA Resp. to Sabre Mot. to Dismiss, Dkt. 124, Aug. 3,
2011, at 25 (incorporating AA‟s response to Travelport)). In its current motion, however, AA
changes course and argues that ADA preemption applies only to claims against airlines. (AA
Mot. for Reconsideration, Dkt. 162, Dec. 19, 2011, at 11-15). Because AA offers no reason for
not raising this argument earlier, the Court should deny AA‟s motion. E.g., Estate of Gaither ex
rel. Gaither v. District of Columbia, 771 F. Supp. 2d 5, 9-10 (D.D.C. 2011) (“[A]lthough styled
as such, Defendants‟ motion is plainly not one for reconsideration. Defendants‟ entire motion
either raises arguments that should have been, but were not, raised in their underlying Motion for

7

Summary Judgment, or merely recycles the same arguments already pressed and rejected. This
approach is, frankly, a waste of the limited time and resources of the litigants and the judicial
system.”); Dos Santos, 651 F. Supp. at 553 (“[C]onsiderations such as whether the movant . . . is
attempting to raise an argument for the first time without justification bear upon the Court‟s
review of the motion for reconsideration.”).
Second, AA‟s new preemption argument is unsupported by the statutory text or
precedent. The text of the ADA does not preempt only claims against airlines. Instead, the ADA
says that states “may not enact or enforce a law, regulation, or other provision having the force
and effect of law related to a price, route, or service of an air carrier.” 49 U.S.C. § 41713(b).
The well-settled statutory test for determining whether ADA preemption applies tracks this
language: it applies to all claims that (1) “derive from the enactment or enforcement of state
law,” and (2) “relate to airline rates, routes, or services, either by expressly referring to them or
by having a significant economic effect upon them.” All World Prof’l Travel Servs., Inc. v. Am.
Airlines, Inc., 282 F. Supp. 2d 1161, 1168 (C.D. Cal. 2003).3 Counts 5 and 6 meet this statutory
test. First, AA sought in those counts to enforce the Texas common law of tortious interference.
Second, these counts relate to AA‟s prices, routes, or services. AA alleged that Sabre‟s actions
“misled and confused the Travel Agent and Corporate Subscribers regarding American‟s fares
and have thwarted the ability of the Travel Agent and Corporate Subscribers to make

3

All World held that the ADA did not preempt the claims at issue, but only because they
did not “relate to” an airline‟s prices, routes, or services. No such concern exists here because,
as described in the text, AA‟s claims plainly do relate to its prices, routes, and services. Many
other courts have similarly applied a two-part test. E.g., United Airlines, Inc. v. Mesa Airlines,
Inc., 219 F.3d 605, 609 (7th Cir. 2000); Travel All Over the World, Inc. v. Kingdom of Saudi
Arabia, 73 F.3d 1423, 1432 (7th Cir. 1996); Abdu-Brisson v. Delta Air Lines, Inc., 927 F. Supp.
109, 111 (S.D.N.Y. 1996); Chrissafis v. Continental Airlines, 940 F. Supp. 1292, 1297 (N.D. Ill.
1996); Delta Airlines v. Black, 116 S.W.3d 745, 753 (Tex. 2003); Continental Airlines v. Kiefer,
920 S.W.2d 274, 281-82 (Tex. 1996).

8

reservations for and otherwise sell airline tickets for flights on American” (AA First Am.
Compl., ¶ 155, Dkt. 52, June 1, 2011) and that it has suffered “actual damages” due to “a
decrease in ticket sales” (Id. ¶ 156). AA also asked the Court to enjoin conduct that it alleges
causes confusion about “American‟s fares” and misrepresents “American‟s fares to travel agents
and to the public” (Id. ¶¶ 98, 155).
AA does not dispute any of this. Instead, it urges the Court to read an additional
requirement into the statute — that ADA preemption should apply only to claims against
airlines.4 (AA Mot. for Reconsideration, Dkt. 162, Dec. 19, 2011, at 11-15.) Yet AA points to
nothing in the statutory text to support this view. Quite the contrary: the statute says that it
preempts enforcement of any state law claim “related to” a “price, route, or service,” without
mention of the target of the enforcement. In Morales v. TWA, the Supreme Court interpreted
“related to” to preempt any state law claim that has “a connection with or reference to” an
airline‟s prices, routes, or services. 504 U.S. 374, 388 (1992). Morales expressly declined to
hold that the ADA prevents states only from actually prescribing an airline‟s rates, routes, or
services or that “only state laws specifically addressed to the airline industry are pre-empted.”
Id. at 383-86. The Court instead emphasized the preemption clause‟s “broad scope” and
“expansive sweep.” Id. at 384 (citations and internal quotations omitted); see also Lyn-Lea
Travel Corp. v. Am. Airlines, Inc., 283 F.3d 282, 286 (5th Cir. 2002) (quoting Morales and
noting “the Court held that the phrase „relating to rates, routes, or services‟ in the ADA was
„deliberately expansive‟”); Order on Mot. to Dismiss, Dkt. 156, Nov. 11, 2011, at 33-34,

4

Notably, AA took the opposite position in Continental Airlines, Inc. v. Am. Airlines,
Inc.,824 F. Supp. 689 (S.D. Tex. 1993), a suit against AA‟s parent company. There, AA argued
that ADA preemption “applies to non-carriers as well” and the court agreed, holding that
“[n]othing in the ADA suggests that [preemption] applies only to suits against an air carrier.” Id.
at 969.
9

(quoting Morales and Lyn-Lea and holding that the phrase “related to” is “deliberately expansive
and preempt[s] any state enforcement action having a connection with or reference to airline
rates, routes, or services”) (internal quotation marks omitted).
Recognizing that the text of the preemption clause undermines its claim, AA argues that a
different section of the ADA, the anti-deception clause, 49 U.S.C. § 41712(a), supports its
position. The anti-deception clause specifies that the U.S. Department of Transportation has
authority to “investigate and decide whether an air carrier, foreign air carrier, or ticket agent has
been or is engaged in an unfair or deceptive practice or an unfair method of competition in air
transportation or the sale of air transportation.” 49 U.S.C. § 41712(a). AA says that because the
anti-deception clause expressly lists “ticket agents” — a phrase that includes GDSs — the
preemption clause cannot apply to claims against GDSs because the preemption clause does not
also expressly identify “ticket agents.”
But AA‟s argument has it backward. While the anti-deception clause expressly
enumerates the entities over which the DOT has regulatory authority — “air carriers,” “foreign
air carriers,” and “ticket agents” — the preemption clause does not enumerate specific entities,
but rather broadly proscribes all state enforcement of laws “related to” a “price, route, or service
of an air carrier.” 49 U.S.C. § 41713(b). The distinction between these two clauses supports the
Court‟s decision and Sabre‟s position: the preemption clause is nowhere limited only to claims
against air carriers; instead, it applies to preempt any enforcement of state law related to prices,
routes, or services, regardless of the target.5

5

Another consequence of AA‟s argument is that the preemption clause would not apply
to claims against “foreign air carriers,” which like “ticket agents” are specifically enumerated in
the anti-deception clause. This illogical outcome further emphasizes the fatal flaws in AA‟s
argument.

10

Unsurprisingly given the central role GDSs play in the provision of air transportation
services, courts often find ADA preemption applies to state law claims against GDSs. In fact,
controlling Fifth Circuit precedent Lyn-Lea Travel Corp. holds that the ADA preempts state
tortious interference claims against Sabre. 283 F.3d at 286. The Fifth Circuit even rejected the
exact argument AA makes here:
Lyn-Lea also argues, without citing supporting authority, that its claims against Sabre
cannot be preempted because Sabre is not an air carrier. ADA preemption is not limited
to claims brought directly against air carriers. Rather, claims are preempted if they
“relate to” the prices, routes, or services of an air carrier.
Id. at 287-88 & n.8 (noting that GDSs have a “significant relationship to the economic aspects of
the airline industry” and the role GDSs play as “intermediaries between carriers and passengers”)
(citations omitted) (emphasis added). AA‟s only response to this binding precedent is to say that
Sabre was at one time an AA subsidiary. (AA Mot. for Reconsideration, Dkt. 162, Dec. 19,
2011, at 15.) But AA did not own Sabre when Lyn-Lea was decided, as the Fifth Circuit
specifically recognized. 283 F.3d. at 285 n.2 (“Sabre succeeded American as defendant and
counter-plaintiff in this suit”). Nor did AA‟s past ownership of Sabre play any role in the
analysis: the Fifth Circuit based its analysis on the statutory text, focusing on whether the claims
“related” to the prices, routes, or services. In addition, the Fifth Circuit noted that “[t]he ADA‟s
legislative history … provides clear and convincing evidence that Congress intended to preempt
state law in the regulation of [GDS] services.” Id. at 288-89 (citation omitted).
Other courts have also held that ADA preemption applies to state law claims against
GDSs. See Frontier Airlines, Inc. v. United Airlines, Inc., 758 F. Supp. 1399, 1408, 1410 (D.
Colo. 1989) (holding “[f]ederal law preempts state laws regulation the provision of [GDS]
services” and “preempt[s] a state‟s attempt to enforce its law to determine whether conduct
related to the provision of [GDS] services was improper,” recognizing that the legislative history

11

provides “clear and convincing evidence that Congress intended to preempt state law in the
regulation of [GDS] services,” and recognizing that “the access [the GDS] provides airlines and
travel agents is not only unique to the airline industry, but essential to competition for
passengers”); Manassas Travel, Inc. v. Worldspan, L.P., Case No. 2:07-CV-701-TC, 2008 U.S.
Dist. LEXIS 35217, at *6-7 (D. Utah Apr. 30, 2008) (granting a GDS‟s motion to dismiss
tortious interference claims because the ADA preempted plaintiff‟s non-contract state law
claims); Galileo Int’l, L.L.C. v. Ryanair, Ltd., Case No. 01 C 2210, 2002 U.S. Dist. LEXIS 3317,
at *12-15 (N.D. Ill. Feb. 27, 2002) (applying ADA preemption to state law claims against a GDS
because the allegations “relate to airline „services‟ within the scope of the ADA‟s preemption
clause”).
Against these authorities, AA over-reads a handful of inapposite cases that did not
involve GDSs. AA boldly claims that “[c]ourts consistently find that claims against travel/ticket
agents are not preempted,” but then cites only an unpublished appeal from a small claims court
verdict in Ohio state court. (AA Mot. for Reconsideration, Dkt. 162, Dec. 19, 2011, at 14). That
case involved a claim by a customer against his travel agent after he missed his flight and had
nothing to do with an airline‟s prices, routes, or services or with a GDS. See Kneuss v. Ritenour,
No. 2001AP110097, 2002 WL 31518175 (Ohio App. Nov. 6, 2002). The other cases AA cites
involve state law claims either brought by or against airlines. Because the entity before the court
was an airline, the courts in these cases sometimes use phrases like “upon airlines” or “on
airlines” when discussing the reach of ADA preemption. E.g., Ginsberg v. Northwest, Inc., 653
F.3d 1033 (9th Cir. 2011); Trujillo v. Am. Airlines, Inc., 938 F. Supp. 392, 393-94 (N.D. Tex.

12

1995); Continental Airlines, Inc. v. Kiefer, 920 S.W.2d 274, 282 (Tex. 1996).6 But such
phrasing under the circumstances cannot fairly be read to show that ADA preemption applies
exclusively to airlines, especially when that issue was not before any of these courts.
Other cases involved claims against non-airlines where the claims simply did not
sufficiently relate to prices, routes, or services to trigger ADA preemption. See Alaska Airlines
Inc. v. Carey, 395 Fed. App‟x 476, 478 (9th Cir. 2010); United Airlines, Inc. v. Gregory, 716 F.
Supp. 2d 79, 90 (D. Mass. 2010); Frequent Flyer Depot, Inc. v. Am. Airlines, Inc., 281 S.W.3d
215, 221-22 (Tex. App.—Fort Worth 2009, pet. denied). These courts did not apply ADA
preemption because the claims were too far removed from prices, routes, or services, not because
ADA preemption never applies to claims against a non-airline. Specifically, all these cases
involved attempts to prevent individuals from illicitly brokering frequent flyer miles or airline
vouchers.7 Carey, 395 Fed. App‟x at 477-78; Gregory, 716 F. Supp. 2d at 82, 92; Frequent Flyer
Depot, 281 S.W.3d at 22-210. Here, by contrast, Sabre plays a central role in the distribution of
airline flights and fares, and AA does not dispute that its tortious interference claims are closely
related to its prices, routes, and services. That is enough to trigger ADA preemption.
Third, AA asks the Court to “withdraw” its prior opinion because AA sought to drop its
state law claims in its motion to file a second amended complaint. (AA Mot. for
Reconsideration, Dkt. 162, Dec. 19, 2011, at 15-16.) For the reasons given in the Court‟s
original opinion, the Court should deny this request too. The Court explained that AA‟s motion

6

Moreover, Ginsberg involved a contract claim, Ginsberg, 653 F.3d at 1034-35, and the
Supreme Court has held that the ADA does not preempt contract claims, see Am. Airlines, Inc. v.
Wolens, 513 U.S. 219, 228-33 (1995). AA‟s Counts 5 and 6 were state law tort claims.
7
Another distinction is that these cases involved contract or quasi-contract claims, see
Carey, 395 Fed. App‟x at 478; Gregory, 716 F. Supp. 2d at 92; Frequent Flyer Depot, 281
S.W.3d at 221, and, as already noted, the ADA does not preempt enforcement of private
agreements.

13

to file a second amended complaint came “subsequent to the Court‟s consideration” of the
motions to dismiss. (Order on Mot. to Dismiss, Dkt. 156, Nov. 21, 2011, at 38.) The Court then
recognized that AA‟s request was “a moot point, given the Court‟s decision to dismiss those
claims.” (Id.) AA does not now claim that the Court lacked authority to decide the motion to
dismiss on Counts 5 and 6; instead, AA says only that the Court was “entitled” to consider these
issues moot and then goes on to trivialize the Court‟s consideration of the issue and its opinion as
“advisory.” (AA Mot. for Reconsideration, Dkt. 162, Dec. 19, 2011, at 15-16.) Yet the Court
was entitled to issue its ruling on the pending motion to dismiss first, and its opinion plainly is
not advisory because it was deciding a specific, fully briefed controversy on an issue properly
before the Court at the time due to AA‟s operative, first amended complaint.8 AA‟s request for
reconsideration should be recognized for what it is: an attempt to forum shop this dispute and
avoid the consequences of the Court‟s ruling.
In sum, the Court‟s dismissal of Counts 5 and 6 was correct. A motion for
reconsideration should not be used to raise arguments that could have been raised earlier but
were not. AA offers no excuse for not making these arguments in response to the motions to
dismiss, and points to no new law or facts that should allow it to make these arguments now.
Even if a motion for reconsideration were proper, AA is wrong on the merits and cannot show
any legal error at all, much less clear error, in the Court‟s decision. Nor is dismissing these
claims unjust: AA had a full opportunity to argue about preemption on the merits, did argue the
issue, and lost; AA also admits that it no longer wants to pursue these claims, so depriving AA of
that opportunity by dismissing them also cannot be unjust.
8

AA gripes in a footnote that preemption received inadequate briefing. (AA Mot. for
Reconsideration, Dkt. 162, Dec. 19, 2011, at 16 n.5.) Even if AA now believes its briefing was
incomplete, that assumes the Court did not carefully study the issue. Inadequate briefing also is
not a recognized ground for reconsideration.

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***
For the foregoing reasons, Sabre respectfully requests that the Court deny American
Airline‟s motion requesting the Court reconsider its November 21, 2011 order.

DATED: Jan. 19, 2012

Respectfully submitted,
/s/ Scott A. Fredricks
Ralph H. Duggins
Texas Bar No. 06183700
Scott A. Fredricks
Texas Bar No. 24012657
Philip A. Vickers
Texas Bar No. 24051699
CANTEY HANGER LLP
Cantey Hanger Plaza
600 West 6th Street, Suite 300
Fort Worth, TX 76102-3685
Phone: [phone]
Fax: [phone]
[e-mail]
[e-mail]
[e-mail]
George S. Cary
D.C. Bar No. 285411
Steven J. Kaiser
D.C. Bar No. 454251
Larry C. Work-Dembowski
D.C. Bar No. 486331
Kenneth Reinker
D.C. Bar No. 999958
CLEARY GOTTLIEB STEEN & HAMILTON LLP
2000 Pennsylvania Avenue, N.W.
Washington, DC 20006
Phone: [phone]
Fax: [phone]
[e-mail]
[e-mail]
[e-mail]
[e-mail]

15

Donald E. Scott
Colorado Bar No. 2129
Illinois Bar No. 2531321
Karma M. Giulianelli
Colorado Bar No. 30919
California Bar No. 184175
Sean C. Grimsley
Colorado Bar No. 36422
California Bar No. 216741
Sundeep K. (Rob) Addy
Colorado Bar No. 38754
BARTLIT BECK HERMAN PALENCHAR &
SCOTT LLP
1899 Wynkoop Street, 8th Floor
Denver, Colorado 80202
Phone: [phone]
Fax: [phone]
[e-mail]
[e-mail]
[e-mail]
[e-mail]
Chris Lind
Illinois Bar No. 6225464
Colorado Bar No. 27719
Andrew K. Polovin
Illinois Bar No. 6275707
BARTLIT BECK HERMAN PALENCHAR &
SCOTT LLP
Courthouse Place
54 West Hubbard
Chicago, IL 60654
Phone: [phone]
Fax: [phone]
[e-mail]
[e-mail]
Attorneys for Sabre Inc., Sabre Holdings
Corporation, and Sabre Travel Int’l Ltd.
d/b/a Sabre Travel Network

16

CERTIFICATE OF SERVICE
I hereby certify that all counsel of record who are deemed to have consented to electronic
service are being served with a copy of the foregoing document via the Court‟s CM/ECF system
pursuant to the Court‟s Local Rule 5.1(d) on January 19, 2012.
/s/ Scott A. Fredricks
Scott A. Fredricks
Counsel for Defendants Sabre Inc., Sabre Holdings
Corp, and Sabre Travel Int’l Ltd. d/b/a Sabre
Travel Network

17