Hobbs v. Labor Commission
Annotate this Casepublication in the Pacific Reporter.
IN THE UTAH COURT OF APPEALS
----ooOoo----
Max Hobbs,
Petitioner,
v.
Labor Commission;
Labor Commission Appeals
Board;
and Delta Airlines, Inc.,
Respondents.
OPINION
(For Official Publication)
Case No. 981742-CA
F I L E D
October 28, 1999
1999 UT App 308
-----
Original Proceeding in this Court
Attorneys:
Steven W. Dougherty and
Shayne R. Kohler, Salt Lake City, for Petitioner
Alan Hennebold, Salt Lake
City, for Respondent Labor Commission Frederick R. Thaler and Janet Hugie
Smith, Salt Lake City, and Benjamin A. Stone, Atlanta, Georgia, for Respondent
Delta Airlines
-----
Before Judges Greenwood, Billings, and Jackson.
BILLINGS, Judge:
¶1
Petitioner Max Hobbs appeals
from an order of the Utah Labor Commission's Appeals Board (Appeals Board)
affirming the Administrative Law Judge's (ALJ) granting of Delta Air Lines's
(Delta) motion to dismiss Hobbs's handicap discrimination claim, determining
it was preempted by federal law. We reverse and remand.
BACKGROUND
¶2
Hobbs worked as a baggage
handler for Delta. His duties included operating "tugs," small tractors
that pull baggage carts. On May 2, 1995, Hobbs was operating a tug when
he hit a "flap guide" with the tug as he pulled away from an aircraft,
causing damage to the flap guide. On June 5, 1995, again while operating
a tug, Hobbs hit an aircraft
¶3
Hobbs had been diagnosed
with bipolar disorder in 1989. At the time of the accidents, he was not
on medication. Hobbs alleged his unmedicated disorder may have contributed
to the accidents. After he was notified of his suspension, Hobbs told Delta
of his disorder and requested accommodation, such as being relieved of
the duty to operate tugs until he could stabilize his condition with medication.
He had been accommodated in a like manner shortly after his disorder was
diagnosed.
¶4
Delta refused Hobbs's request
for accommodation and terminated him on June 29, 1995. Delta asserts that
it fired Hobbs because of safety violations. Hobbs asserts that he was
discriminated against based on his disability in violation of the Utah
Antidiscrimination Act (UADA). See Utah Code Ann. §§ 34A-5-101
to 108 (1997 & Supp. 1999). Hobbs filed a charge of discrimination
with the Utah Labor Commission (Commission). The Utah Anti-Discrimination
Division of the Commission (UADD) found that Hobbs had established a prima
facie case of discrimination and ordered reinstatement.
¶5
Delta requested a review
of the UADD order before an ALJ. Delta then submitted a motion to dismiss,
arguing Hobbs's claim was preempted under the Airline Deregulation Act
(ADA). See 49 U.S.C. § 41713(b)(1) (1998) (preempting state
law "related to" prices, routes, or services of air carriers). After a
hearing, the ALJ concluded that Hobbs's claim was preempted and granted
Delta's motion to dismiss. The ALJ determined that 1) Hobbs had committed
safety violations, 2) safety was related to services under the ADA, and
3) Hobbs's claim was therefore preempted under the ADA. The Appeals Board
affirmed the dismissal.
STANDARD OF REVIEW
¶6
A grant of a motion to dismiss
is proper "'only where it appears that the plaintiff . . . would not be
entitled to relief under the facts alleged or under any state of facts
they could prove to support their claim.'" Robertson v. Gem Ins. Co.,
828 P.2d 496, 499 (Utah Ct. App. 1992) (quoting
Prows v. State,
822 P.2d 764, 766 (Utah 1991)). "On appeal, we accept the facts as alleged
in the complaint as true, and consider those facts and all reasonable inferences
therefrom, in a light most favorable to plaintiffs." Id. The propriety
of a dismissal presents a question of law, thus appellate courts give no
deference to agency determinations and "review the issues under a correctness
standard." Harmon City, Inc. v. Nielsen & Senior, 907 P.2d 1162,
1167 (Utah 1995).
¶7
Preemption is a matter of
statutory interpretation and is thus a matter of law reviewed for correctness.
See id. However, preemption under the ADA is a fact-specific inquiry.
See Smith v. Comair, Inc., 134 F.3d 254, 259 (4th Cir. 1998)
("To determine whether a claim has a connection with, or reference to an
airline's prices, routes, or services, we must look at the facts underlying
the specific claim."); Abdu-Brisson v. Delta Air Lines, Inc., 128 F.3d 77, 85-86 (2d Cir. 1997) ("[W]e can offer no bright line relief. Our
only recourse is to apply the ADA preemption provision as we understand
its meaning on a case-by-case basis."). The defendant "bear[s] the burden
of overcoming the initial presumption against preemption." Abdu-Brisson,
128 F.3d at 83 (citations omitted).
ANALYSIS
¶8
Hobbs asserts the ALJ used
inappropriate facts and inferences in reaching her conclusion that Hobbs's
termination was safety related and therefore preempted under the ADA. Delta
argues that Hobbs's claim under the UADA(1)
is preempted by the Federal ADA as a matter of law.
¶9
The ADA includes an express
preemption provision that states, "a State . . . 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 that may
provide air transportation under this subpart." 49 U.S.C. § 41713(b)(1)(1998)
(emphasis added). Delta asserts that Hobbs's termination was related to
service because it concerned safety. The issue is whether Hobbs's handicap
employment discrimination claim comes within the scope of this express
preemption provision.(2)
¶10
In conducting a preemption
analysis, we first focus on the nature of Hobbs's handicap discrimination
claim, and then determine if it is preempted by the ADA. In employment
discrimination matters, there is a specific multi-step process to establish
and defend a claim. See University of Utah v. Industrial Comm'n,
736 P.2d 630, 634-35 (Utah 1987). The employee must first establish a prima
facie case of discrimination; then the burden shifts to the employer to
put forth a legitimate, nondiscriminatory reason for the action taken;(3)
finally, the burden shifts back to the employee to prove, by a preponderance
of evidence, that the legitimate reasons offered were a pretext for discrimination.
See id.
¶11
Here, Hobbs established
a prima facie case, as acknowledged by the UADD. Delta then put forth a
legitimate reason for its action, asserting safety reasons for terminating
Hobbs. Under usual circumstances, Hobbs would have the opportunity to show
this stated reason was a pretext.(4) Indeed,
that is the core of a discrimination claim--that the action taken was based
on an impermissible reason.
¶12
However, in this case, at
this early stage, the ALJ accepted Delta's characterization of the facts
and premised her decision on Delta's safety rationale. She accepted Delta's
proffered, though disputed, motivation for its action, and thus based her
legal conclusion of preemption on an impermissible foundation.
¶13
The determination that Hobbs's
termination was based on safety reasons was premature given the procedural
posture of this case. A motion to dismiss "admits the facts alleged in
the complaint but challenges the plaintiff's right to relief based on those
facts." Russell v. Standard Corp., 898 P.2d 263, 264 (Utah 1995).
All reasonable inferences from the accepted facts are to be drawn in the
light most favorable to the plaintiff. See Robertson, 828 P.2d at 499. The ALJ, instead of accepting the factual allegations of Hobbs's
complaint and drawing all inferences in his favor, accepted Delta's characterizations
of the incidents, particularly that Delta's motivation for terminating
Hobbs was safety related. Delta's motivation is a disputed issue of fact;
it is inappropriate to determine this factual matter at the level of a
motion to dismiss.
¶14
The procedural posture of
this case is nearly identical to Parise v. Delta Airlines, Inc.,
141 F.3d 1463 (11th Cir. 1998). In Parise, a district court granted
Delta's motion to dismiss an employment discrimination claim, accepting
Delta's explanation that the employee was terminated for safety reasons.
See id. at 1464-65. The Eleventh Circuit reversed, concluding the
district court erred in finding the claim preempted under the ADA. See
id. at 1467-68. The court noted that "the district court . . . explicitly
premised its finding of preemption on the relationship between [the
employee's alleged conduct] and the 'service' of safety that Delta is bound
to provide." Id. at 1466 (emphasis added). The court concluded that
the district court erred by determining the legal significance of this
relationship at this early stage of the proceedings: "Significantly, the
issue of [the employee's alleged safety violations] arises here in response
to and as a defense to the claim presented in the complaint. Although
the complaint mentions [the alleged violations] as part of the factual
narrative . . . the complaint sets forth a cause of action for age discrimination."
Id. The court emphasized that it is the cause of action, not the
factual circumstances alleged in the answer, that determines whether a
claim is preempted: "We believe that it is inappropriate . . . for the
court to credit the defendant's proffered non-discriminatory justification
for its decision to terminate an employee and use that allegation as a
basis to find preemption, thereby potentially depriving the plaintiff of
any remedy." Id.
¶15
This describes Hobbs's situation.
Even though the fact narrative includes Hobbs's admission of the accidents,
the Appeals Board's preemption argument is founded exclusively on Delta's
proffered reason for having terminated Hobbs. Cf. id. at 1467. However,
Delta's motivation is a highly contested fact that is dispositive of the
entire claim.
¶16
The Appeals Board accepted
without question Delta's proffered reason for terminating Hobbs, when the
reason is the matter in dispute.(5) Even
if safety issues(6) are preempted under
the ADA, preemption cannot apply at this stage because Delta's motive is
disputed.
¶17
In sum, the ALJ improperly
accepted Delta's characterization of facts and motive, and thus reached
a preemption conclusion prematurely. The Appeals Board likewise erred in
affirming the ALJ's premature conclusion. We therefore reverse and remand
to allow Hobbs an opportunity to prove his claim.
______________________________
Judith M. Billings, Judge
-----
WE CONCUR:
______________________________
Pamela T. Greenwood,
Associate Presiding Judge
______________________________
Norman H. Jackson, Judge
1. The UADA provides: "It is a discriminatory or prohibited employment practice for an employer: (a)(i) to refuse to hire, or promote, or to discharge, demote, terminate any person . . . otherwise qualified, because of . . . handicap." Utah Code Ann. § 34A-5-106(1)(a)(i) (1997).
2. The
United States Constitution provides that federal laws "shall be the supreme
Law of the Land." U.S. Const. art. VI, cl. 2. As a result, federal laws
will preempt state law under some circumstances. Preemption analysis "start[s]
with the assumption that the historic police powers of the States [are]
not to be superceded by . . . Federal Act unless that [is] the clear and
manifest purpose of Congress." Cipollone v. Liggett Group, Inc.,
505 U.S. 504, 516, 112 S. Ct. 2608, 2617 (1992) (citation and quotation
marks omitted) (alterations in original). Whether express or implied, the
ultimate test in determining the scope of preemption is the intent of Congress.
See id. at 516, 112 S. Ct. at 2617.
It is well established that
Congress's purpose in enacting the ADA was the encouragement of competition
and the "economic deregulation of the airline industry." Charas v. Trans
World Airlines, Inc., 160 F.3d 1259, 1265 (9th Cir. 1998). "'To ensure
that the States would not undo federal deregulation with regulation of
their own,' the ADA included a preemption clause." American Airlines
Inc. v. Wolens, 513 U.S. 219, 222, 115 S. Ct. 817, 821 (1995) (quoting
Morales v. Trans World Airlines, Inc., 504 U.S. 374, 378, 112 S. Ct. 2031, 2034 (1992)).
3. Defendant's burden is not to persuade the court, but defendant must put forth evidence that "raises a genuine issue of fact as to whether it discriminated against [plaintiff]." University of Utah, 736 P.2d at 634.
4. Hobbs alleges in his charge of discrimination that other Delta workers were accommodated. This is one way of showing that the proffered reason for an employment action is pretext, and the action is really based on a discriminatory reason.
5. We agree with the dissent from the Appeals Board's decision, noting the majority "err[ed] in its reliance, at this stage of the proceedings, on facts that are not yet proved."
6. Courts
have consistently found employment discrimination claims based on race,
sex, or age not preempted because they are not "related to services." See
Wellons v. Northwest Airlines, Inc., 165 F.3d 493, 496 (6th Cir.
1999) (holding state law race discrimination claim not preempted); Parise,
141 F.3d at 1467-68 (holding state law age discrimination claim not preempted);
Abdu-Brisson, 128 F.3d at 86 (holding age claim not preempted);
Gilman v. Northwest Airlines, Inc., 583 N.W.2d 536, 539-40 (Mich.
Ct. App. 1998) (holding sex discrimination claim not preempted). However,
some courts distinguish claims based on physical characteristics, finding
them preempted. See Belgard v. United Airlines, 857 P.2d 467, 469 (Colo. Ct. App. 1992) (holding state handicap discrimination claim
preempted); Fitzpatrick v. Simmons Airlines, Inc., 555 N.W.2d 479
(Mich. Ct. App. 1996) (per curiam) (same). But see Aloha Islandair
Inc. v. Tseu, 128 F.3d 1301, 1303 (9th Cir. 1997) (holding state law
disability claim not preempted).
Currently there is no single
interpretation of what is encompassed by the term "service." Federal appellate
circuits have developed two primary definitions of "service" in addressing
ADA preemption. The Fifth Circuit has broadly defined service as that which
is bargained for, including ticketing, food service, and baggage handling
in addition to transportation. See Hodges v. Delta Airlines,
Inc., 44 F.3d 334, 336 (5th Cir. 1995) (en banc).
The Ninth Circuit forged
its own definition. See Charas v. Trans World Airlines, Inc.,
160 F.3d 1259 (9th Cir. 1998). That court emphasized the ADA's purpose
of economic deregulation and interpreted the ADA's preemption provision
in this narrower context. "'Rates' indicates price; 'routes' refers to
courses of travel." Id. at 1265. The court concluded that 'service,'
when juxtaposed with these terms, "refers to such things as the frequency
and scheduling of transportation, and to the selection of markets." Id.
at 1265-66. "To interpret 'service' more broadly . . . would result in
the preemption of virtually everything an airline does." Id. at
1266.
The Third Circuit recently concluded the Ninth Circuit approach "offers a more promising solution" to interpreting the ADA preemption provision. Taj Mahal Travel Inc. v. Delta Airlines, Inc., 164 F.3d 186, 194 (3rd Cir. 1998).
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