April 2009

From the editors of CCH's Transportation products, here are summaries of the important recent developments in the area for the past month.  Complete coverage of these issues, and many more, appear in our print and electronic products, including: Aviation Law Reporter, Commercial Aircraft Transactions, Issues in Aviation Law and Policy, Federal Carriers Reporter, Federal Motor Carrier Safety Administration Decisions, and Motor Carrier Liability.

If you have comments or suggestions concerning the information provided or the format used, please feel free to contact me directly at aaron.broaddus@wolterskluwer.com.

Hot Topic

Bird-Strike Data Proposal Withdrawn: Database Goes Public
The Federal Aviation Administration made its entire Bird Strike Database available on a public website last week, withdrawing an earlier proposal to protect the data after the close of a 30-day comment period on the now-abandoned initiative. As previously reported [see CCH AVIATION LAW REPORTS No. 1400, March 26, 2009], the agency had sought to limit public access to data regarding bird and other animal strikes encountered by aircraft in order to encourage the continued voluntary reporting of such incidents by pilots, air traffic controllers, air carrier personnel, and airport operations employees. Portions of the database had been publicly available since the information first started being collected in 1990, but the public now has access to all of the database's fields. A small amount of data containing privacy information, such as personal telephone numbers, was redacted by the agency before releasing the entire database to the public, FAA indicated. Over the next four months, FAA intends to make "significant improvements" to the database in order to improve search function and user-friendliness. In its current format, users are able to perform only limited searches online, but may download the database in its entirety. The agency also said that it plans to work with the aviation community to find ways to improve and strengthen bird-strike reporting. The database is accessible at http://wildlife-mitigation.tc.faa.gov/public_html/index.html#access.

For his part, Mark V. Rosenker, Acting Chairman of the National Transportation Safety Board, praised the Department of Transportation and Transportation Secretary Ray LaHood for the decision to publicly release the bird-strike data. Before it was withdrawn, NTSB had filed an objection to FAA's proposal to bar public release of the data. In 1999, the Board recommended that FAA require all airplane operators to report bird strikes, rather than the voluntary-reporting scheme currently in place. Aviation Law Reports, Report Letter No. 1402, April 30, 2009.

Aviation Funding Extended for Six Months
President Barack Obama on March 30 signed into law the Federal Aviation Administration Extension Act of 2009 (Pub. L. No. 111-12, 123 Stat. 1457), a six-month extension of aviation programs and taxes through September 30, 2009. The previous FAA authority expired on March 31, 2009. The aviation excise taxes extended under the Extension Act support the Airport and Airway Trust Fund, which provides about 80 percent of FAA's budget. In addition, the Act provides a total of $3.9 billion in contract authority for the Airport Improvement Program for fiscal 2009. It also authorizes short-term appropriations for FAA Operations, Facilities and Equipment, as well as Research, Engineering, and Development programs. Aviation Law Reports, Report Letter No. 1401, April 16, 2009.

Aviation News

Randy Babbitt Tapped to Be New FAA Chief
President Obama indicated that he intends to nominate J. Randolph (Randy) Babbitt to be Administrator of the Federal Aviation Administration. Currently a partner in Oliver Wyman, a worldwide aviation consultancy, Mr. Babbitt began his aviation career as a pilot for Eastern Airlines and flew for more than 25 years. He was President of the Air Line Pilot's Association in the 1990s and, in 1993, was a Presidential appointee on the National Commission to Ensure a Strong Competitive Airline Industry. In 2008, he was named by the Secretary of Transportation to an independent review team of aviation and safety experts tasked with evaluating and crafting recommendations to improve the FAA's implementation of the aviation safety system and its culture of safety. Aviation Law Reports, Report Letter No. 1401, April 16, 2009.

Secure Flight Program's Passenger Vetting Begins
The Transportation Security Administration has begun to implement Secure Flight, an initiative under which pre-departure watch-list matching duties are being shifted to the agency from individual air carriers. To date, TSA has assumed the watch-list matching responsibilities for passengers on domestic commercial flights with four volunteer airlines, and will add more carriers in the coming months. In the second stage of implementation—expected to begin in late 2009—TSA will assume the watch-list matching function for passengers on international flights. Currently, those tasks are being undertaken by international carriers and U.S. Customs and Border Protection.

Under Secure Flight, airlines must gather a passenger's full name, date of birth, and gender when making an airline reservation in order to determine whether the passenger is a match to the No-Fly or Selectee lists. By providing the additional data elements of gender and date of birth, Secure Flight will help prevent the misidentification of passengers whose names are similar to individuals on the watch list, according to TSA. In addition, the agency provides a "robust" process through the Department of Homeland Security's Traveler Redress Inquiry Program (www.dhs.gov/trip), a single Internet portal through which travelers can seek redress for adverse screening experiences as well as resolve possible watch-list misidentification issues. Secure Flight also uses the results of the redress process in its watch-list matching efforts in order to prevent future misidentification occurrences, TSA indicated. The agency's goal is to vet 100 percent of all domestic commercial flights by early next year, and 100 percent of all international flights by the end of next year. Aviation Law Reports, Report Letter No. 1401, April 16, 2009.

FAA: Aviation Sector Down in '09 But Will Grow Thereafter
The Federal Aviation Administration's latest annual aviation forecast is predicting a sharp decline in activity during 2009, followed by a return to growth for air travel in the long term. More importantly, the long-term level of activity and demand is not expected to snap back to levels published in the previous FAA forecast, the agency acknowledged, citing the domestic and worldwide economic downturn as the most significant factor affecting the chance for recovery to previously predicted levels.

System capacity in available seat miles (ASMs)—the overall yardstick for how busy aviation is both domestically and internationally—is expected to drop by 6.7 percent this year, and then grow at an average of 3.8 percent per year through 2025, according to FAA. In the domestic market, capacity will drop 9.0 percent in 2009; the largest percentage decline in ASMs since the industry was deregulated in 1978. Mainline carrier capacity will decline 9.5 percent, as both low-cost carriers and network carriers become smaller. By comparison, mainline carriers reduced capacity by 8.3 percent in the aftermath of the September 11, 2001 terrorist attacks, FAA revealed. For regional carriers, domestic capacity will drop 5.5 percent from last year's levels; a turnaround from recent periods of reduced air-travel demand that witnessed an expansion in regional carrier capacity as the mainline carriers transferred capacity to their lower-cost regional code-share partners.

Commercial carrier domestic revenue passenger miles (RPMs) are forecast to fall by 8.9 percent in 2009, and then grow at an average of 3.4 percent per year through 2025. Domestic passenger enplanements will decrease by 7.8 percent for the year, followed by growth at an average of 2.7 percent per year during the remaining 15-year forecast period. The average size of domestic aircraft is expected to decline by 0.7 seats in FY 2009, to 120.1 seats. Average seats per aircraft for mainline carriers are projected to fall by 0.8 seats as network carriers continue to reconfigure their domestic fleets, FAA revealed, adding that, while demand for 70-90-seat aircraft continues to increase, the number of 50-seat regional jets in service will fall (increasing the average regional aircraft size in 2009 by 0.9 seats to 53.7 seats per mile). Passenger trip length in domestic markets will decrease by 10.5 miles this year, largely due to the impact of capacity realignment, FAA said.

While FAA predicted last year that U.S. airlines would reach one billion passengers by 2016, the latest forecast estimates that carriers will not reach the one-billion passenger mark until 2021. The number of passengers on U.S. airlines, domestically and internationally, is predicted to increase from 757.4 million in 2008, to 1.1 billion in 2025. Additional details on the latest forecast—including information on general aviation, cargo demand, landing and takeoff operations at airports, and FAA facilities—is available at http://www.faa.gov/data_research/aviation/aerospace_forecasts/2009-2025/. Aviation Law Reports, Report Letter No. 1401, April 16, 2009.

No Private Right of Action Afforded by Aviation Act
The Federal Aviation Act of 1958 does not provide a private right of action under which a municipal airport board and a pilot could challenge a lease provision entered into by the board and a fixed-base operator (FBO) that allegedly allowed the FBO to claim an exclusive leasehold interest in certain ramp and apron space for aircraft parking, a federal appellate panel ruled, affirming the trial court's decision. According to the panel, the applicable statutory provision precludes "exclusive rights" at certain airport facilities, and specifies that "a person does not have an exclusive right to use an air navigation facility on which Government money has been expended." The language of the provision doesn't explicitly provide for a private cause of action, nor does any other provision of the statute, the court instructed.

Furthermore, the court held that, absent congressional intent to create a private remedy, a cause of action does not exist and cannot be created by the courts, regardless of how desirable it might be as a policy matter or however compatible it is with the law. In accord with prior case law in two other federal appellate circuits, it could not be concluded that Congress had intended the statutory provision at issue to provide a private cause of action, the court said. Moreover, contrary to the plaintiffs' claim that the purpose of the statute cannot be effectuated without implying a private cause of action, the statute's creation of a comprehensive administrative enforcement framework strongly suggests that Congress did not intend to imply a private right of action. Finally, the plaintiffs offered no evidence of Congress' intent to provide a private right of action, the court remarked, concluding that the inference of such a right was not compatible with the purpose and context of the legislative scheme. Bowling Green and Warren County Airport Bd. v. Martin Land Dev. Co. (6thCir) 33 Avi. 17,635.

Passengers Were Discriminated Against, But Not by Carrier
A New York federal court ruled that a passenger with dark complexion who outwardly appeared to be of Indian descent was not entitled to maintain discrimination claims against an air carrier stemming from his alleged treatment while attempting to check-in baggage prior to boarding a flight. While waiting in the passenger check-in line for the sole purpose of checking-in their luggage, the passenger and his wife were allowed by a carrier employee to go beyond the delimiting rope in order to use a check-in kiosk. Finding the kiosk inoperable, the passenger and his wife approached the check-in desk agents rather than returning to the line, whereupon they allegedly were subjected to racially abusive and demeaning gestures by certain others waiting in line.

Although the passenger and his wife subsequently returned to the line after having been directed to do so by the check-in desk agent, one of the allegedly abusive individuals then yelled out that the passenger and his wife had breached security and crashed into the line. Another carrier employee arrived, questioned the passenger and his wife, and detained them until all of the other individuals in line had been processed. As a result, the passenger and his wife missed their ticketed flight and had to wait several hours before boarding another flight.

According to the court, the passenger's complaint did not state a plausible claim that he had been subjected to intentional discrimination by the carrier; the complaint neither asserted that any carrier employee had uttered any derogatory remarks/comments nor that any employee had encouraged such behavior on the part of other individuals waiting in the line. The passenger's complaint also did not allege that the carrier had provided preferential or non-discriminatory treatment to any similarly-situated non-minority passengers, the court added, noting that the complaint merely alleged that the carrier employee who questioned the passenger and his wife had conspired with one of the allegedly abusive individuals in the line in order to violate the plaintiff's civil rights. Combined with the lack of any specific factual support for his assertion of racial motivation, the passenger's claim simply was a naked allegation of racial discrimination, the court remarked. It was apparent from the complaint's allegations that the passenger and his wife had been subjected to contemptible and cutting comments by certain individuals in the line.

However, as vile as those comments had been, they were uttered by private individuals and had been neither sanctioned nor encouraged by the carrier, the court concluded, granting the carrier's motion to dismiss. Tejwani v. United Airlines, Inc. (SDNY) 33 Avi. 17,628.

Bilateral Air Pact Doesn't Alter Forum-Deference Calculus
Dismissal, on the basis of forum non conveniens, of claims brought in U.S. court against an aircraft manufacturer arising out of the fatal crash in Italy of a private jet operated by a German charter company that collided with a commercial aircraft operated by a Swedish air carrier was appropriate, a federal appeals court concluded, affirming the trial court's ruling. According to the appellate panel, Italy was an available alternate forum for litigation because the aircraft manufacturer was willing to submit to jurisdiction and was amenable to process there. In declaring Italy an adequate forum, the trial court correctly noted that Italian courts have addressed similar cases and awarded satisfactory remedies, the panel declared, adding that both parties had agreed that Italian law provides the rule of decision regardless of whether the claims are litigated in the U.S. or in Italy.

Furthermore, although a majority of the European plaintiffs in the suit were from countries that have bilateral treaties with the U.S., the panel asserted that case precedent does not support the assertion that such agreements require that their choice of forum be afforded the same deference afforded to a U.S. citizen bringing suit in his/her home forum. As such, the trial court did not abuse its discretion by according the European plaintiffs' choice of forum less deference. And, having found the private interest factors supporting jurisdiction in or near equipoise, the trial court also did not abuse its discretion in having concluded that the application of Italian law to the numerous issues in the case weighed in favor of dismissal, the panel said. King v. Cessna Aircraft Co. (11thCir) 33 Avi. 17,576.

Surface Transportation News

FMCSA Amends Regulatory Requirements for Freight Forwarders
A final rule requiring all surface freight forwarders to issue receipts or bills of lading for every shipment they arrange has been published by the Federal Motor Carrier Safety Administration (FMCSA). The regulatory change implements amendments enacted in the Interstate Commerce Commission Termination Act of 1995 (ICCTA) and re-establishes consistency between statutory and regulatory requirements applicable to all freight forwarders.

Prior to 1990, both federal law and regulations required motor carriers and freight forwarders providing transportation or service subject to the jurisdiction of the Secretary of Transportation to issue a receipt or bill of lading. However, in 1990, the Interstate Commerce Commission amended its regulations to require that only household goods freight forwarders issue bills of lading. The impact of this change was not clear, since all freight forwarders were subject to Carmack Amendment requirements, which include a statutory requirement to issue receipts or bills of lading.

In 1995, the ICCTA re-authorized the Secretary of Transportation's jurisdiction over all segments of the freight forwarding industry, including a mandate that general commodities freight forwarders that previously had been exempted from most of the rules applicable to freight forwarders register to operate in interstate commerce. As a result of this renewed authority, the FMCSA is amending its regulations concerning receipts and bills of lading to include both household and non-household goods freight forwarders. The final rule takes effect May 6, 2009. Federal Carriers Reports, Report Letter No. 1556, April 27, 2009.

NTSB Issues Safety Recommendations to FRA and Amtrak
Following an investigation into a collision between an Amtrak passenger train and a Norfolk Southern Railway Company freight train near Chicago, Illinois, the National Transportation Safety Board (NTSB) issued safety recommendations to the Federal Railroad Administration (FRA), Amtrak, the Association of American Railroads, the American Short Line and Regional Railroad Association, the American Public Transportation Association, the United Transportation Union, and the Brotherhood of Locomotive Engineers and Trainmen. The incident resulted in injuries to sixty-six passengers and five crew members, as well as approximately $1,299,000 in damages.

The NTSB determined that the probable cause of the collision was the failure of the Amtrak engineer to correctly interpret the signal at an interlocking track segment and Amtrak's failure to ensure that the engineer had the competency to correctly interpret signals across the different territories over which he was operating. Contributing to the accident was the relief engineer's failure to immediately communicate to the operating engineer the miscalled signal and stop the train when there was no response from the engineer. Also, a contributing factor was the absence of effective crew resource management between the relief engineer and the operating engineer, which led to their failure to resolve the miscalled signal prior to the collision. Finally, the NTSB cited the absence of a positive train control system (which would have stopped the Amtrak train when it exceeded restricted speed) as a further contributing factor.

Based on its investigation, NTSB issued the following recommendations to the FRA:

• Establish uniform signal aspects that railroads must use to authorize a train to enter an occupied block, and prohibit the use of these aspects for any other signal indication;
• Study the different signal systems for trains, identify ways to communicate more uniformly the meaning of signal aspects across all railroad territories, and require the railroads to implement as many uniform signal meanings as possible; and
• Require that emergency exits on new and remanufactured locomotive cabs provide for rapid egress by cab occupants and rapid entry by emergency responders.

Recommendations also were made to Amtrak and several railroad associations. NTSB recommended that Amtrak identify engineers and engineer trainees who have not consistently demonstrated competency in interpreting signals and provide them with enhanced training, supervision, testing, and evaluation necessary to determine that signal proficiency has been achieved and maintained.

Additionally, NTSB urged Amtrak and the various railroad associations to use the circumstances of this accident during crew resource management training to reemphasize the necessity of any qualified person on the leading locomotive or car to immediately communicate any disagreement on a called signal and to immediately take action necessary to ensure that the train is operated safely. Additional information on the accident is available on NTSB's website, www.ntsb.gov. Federal Carriers Reports, Report Letter No. 1556, April 27, 2009.

FRA Clarifies Position on Harassment of Injured Employees
The Federal Railroad Administration (FRA) issued a notice of interpretation establishing its position on the application and enforcement of the harassment/intimidation provisions contained in its accident reporting regulations. The interpretation specifically relates to situations in which a supervisor or other railroad official accompanies an injured employee into an examination room. The agency is concerned that, in these situations, the employee may be discouraged or prevented from reporting an accident, incident, injury or illness. Likewise, there are concerns that the supervisor could influence the type or extent of medical treatment afforded to the employee in an effort to affect the reportability of the injury.

As a result of these issues, FRA decided to articulate its longstanding position on the practice of railroad supervisor's being in attendance while an injured employee receives medical treatment. According to the agency, harassment and intimidation occurs when a railroad supervisor accompanies an injured employee into an examination room, unless the injured employee has freely, and without coercion, duress, or intimidation, invited the supervisor into the room, or the injured employee is unconscious or otherwise unable to effectively communicate material information to medical personnel treating him/her and the supervisor's input is required. Federal Carriers Reports, Report Letter No. 1556, April 27, 2009.

Pilot Program on NAFTA Trucking Requirements Terminated
A pilot program that allowed up to 100 Mexico-domiciled motor carriers to operate beyond the U.S. border commercial zones and the same number of U.S. carriers to operate in Mexico has been discontinued by the U.S. Department of Transportation (DOT) effective March 11, 2009. The cross-border program was established to implement certain trucking provisions of the North American Free Trade Agreement (NAFTA). The program was initially expected to last one year, but was extended to the full three years allowed by statute on August 6, 2008.

However, with the enactment of the Omnibus Appropriations Act, 2009 [Pub. L. 111-8, division I, title I, 123 Stat. 524], Congress prohibited the Department of Transportation from using any appropriated funds or resources to continue the project. Accordingly, the Federal Motor Carrier Safety Administration (FMCSA) terminated the cross-border demonstration project. The agency has ceased processing applications by prospective participants and has revoked all registrations issued in connection with the program. Federal Carriers Reports, Report Letter No. 1555, April 10, 2009.

Railroad Employee's FELA Claim Not Precluded by FRSA
A railroad employee's action against his employer under the Federal Employer's Liability Act (FELA) was not precluded by the Federal Railroad Safety Act (FRSA), according to a federal district court. The employee had injured his left ankle and left knee while walking on loose ballast near service track in a rail yard. The employee claimed that his employer had violated FELA by negligently failing to provide its employees with a safe place to work. The employer challenged the employee's claim, asserting that it was barred under the Federal Railroad Safety Act (FRSA) because the Secretary of Transportation had promulgated regulations relating to ballast. The employee argued that FRSA was not applicable because the ballast regulations covered track safety, not employee walkways or walkway conditions, which was the focus of the employee's claim.

The court held that if inconsistencies existed, the FRSA would supersede the FELA based on the policy embodied in the FRSA to ensure uniformity in law pertaining to railway safety. However, there were no inconsistencies between the two federal statutes in this case, since the ballast regulations covered track safety, and did not address employee walkways or walkway conditions. Thus, the employee's FELA claim related to the employer's failure to provide a reasonably safe workplace by failing to provide safe walkways on which employees may perform their work duties was not precluded by the FRSA. Davis v. Union Pac. R.R. Co. (EDArk) Federal Carriers Reporter ¶85,585.

Wine Distributor's Drivers Not Eligible for Overtime Pay
A federal district court determined that the motor carrier exemption to the overtime provisions of the Fair Labor Standards Act (FLSA) was applicable to drivers employed by a wholesale wine importer and distributor, even though the drivers only operated within the state of Illinois. The drivers filed suit against their employer, alleging that it had failed to pay overtime wages. The employer argued that it was exempt from the overtime requirements of the FLSA under a provision of the Motor Carrier Act (MCA) because it was a motor carrier that transported goods in interstate commerce and the employees' job-related duties directly affected the safe operation of motor vehicles in the transport of property in interstate commerce.

The employees argued that the MCA exemption was not applicable because they had not operated in interstate commerce, since all of their deliveries were made within the state of Illinois. The employer asserted that, even if they did not drive out of the state, the employees were covered by the MCA exemption because the goods they were transporting were moved from locations outside of the state, in a “practical continuity of movement,” which amounted to transportation in interstate commerce. Based on the facts presented and the totality of the circumstances, it was determined that the employees were involved in interstate transportation and were engaged in activities affecting the safe operation of a motor vehicle on public highways.

The drivers subsequently argued that, even if the court determined that the MCA exemption was applicable before August 10, 2005, it was not after the enactment of the Safe, Accountable, Flexible, Efficient Transportation Equity Act-A Legacy for Users (SAFETEA-LU) due to the fact that some of the drivers had driven vans weighing less than 10,001 pounds. SAFETEA-LU amended the MCA's definition of “motor carrier” to include the word “commercial” before motor vehicle. Accordingly, after August 10, 2005, the MCA exemption only applied if the property was transported by a commercial motor vehicle. The employees argued that, under the post-SAFETEA-LU requirements, they were not subject to the motor carrier exemption because not all of the vehicles operated by the carrier met the weight requirement necessary to conform to the statutory definition of “commercial motor vehicle.” While the employees would have prevailed if they could have established that they only operated non-commercial motor vehicles, in cases where an employee is required to operate both commercial and non-commercial motor vehicles, the court held that it is generally accepted that, as long as the employee's duties affect the safety of operations of vehicles covered by the MCA, the employee is covered by the motor carrier exemption. Accordingly, the drivers were not entitled to overtime wages under the FLSA. Collins v. Heritage Wine Cellars, Ltd. (NDIll) Federal Carriers Reporter ¶84,586.