U.S. Eleventh Circuit - The FindLaw 11th Circuit Court of Appeals Opinion Summaries Blog

11th Cir. OKs RICO Suit Against Spirit Airlines

Bargain-basement airline company Spirit Airlines is known for a lot of things. Some of them include very cheap fares; others include nickel-and-diming and a "Draconian" cancellation policy (according to The Atlantic) that allows Spirit to cancel a customer's reservation, without notice, and without compensation, if the customer isn't at the boarding gate 15 minutes before the flight (even if he's already checked in).

Bryan Ray was fed up with this. Not only did he file a class action against Spirit, but he made his a civil RICO claim. That's right: He said Spirit was engaged in "racketeering," and the predicate crimes were mail and wire fraud due to Spirit's penchant for charging ancillary "fees" that placed the final price of a ticket well beyond what the customer was told it would cost.

Pre-emption

According to Ray, Spirit "forces consumers to pay unbundled charges that have traditionally been included in the total price of an airline ticket." Spirit, for example, doesn't disclose up front that buying a ticket through a third-party website results in an additional fee. Consequently, Ray argues, the fare is "little more than a down payment on air travel," as the amount generated by these fees is almost equal to the price of a ticket.

Spirit moved to dismiss -- but only because it claimed the Airline Deregulation Act (ADA) of 1978 pre-empted RICO insofar as RICO purported to regulate airlines. Not so fast, said the Eleventh Circuit -- that's not how pre-emption works. "Because federal laws do not pre-empt other federal laws, subsequent legislation could preclude Plaintiffs' claims only if Congress had repealed the provisions of RICO, at least insofar as they authorized Plaintiffs' actions," said the court.

The Federal Aviation Act (FAA), by its terms, did not "in any way abridge or alter the remedies now existing at common law or by statute" when it was enacted in 1958. The ADA explicitly pre-empted state laws on the matter, but similarly allowed "any other remedies provided by law."

Not an Implied Repeal, Either

Neither the FAA nor the ADA allows for a private right of action -- but RICO does. The court here found neither pre-emption (because that doctrine doesn't apply) or an "implied repeal." However, "[t]he cardinal rule is that repeals by implication are not favored" because Congress is expected to know what laws it's already passed, and passing another law on the same subject shouldn't carry a presumption that Congress forgot about its previous law.

Obviously, Congress couldn't have repealed RICO through the FAA: "As a matter of chronological necessity, the 1958 FAA could not have repealed any part of the yet-to-be-born 1970 RICO statute." Nor is there an "irreconcilable conflict between the two.

Thus, without ruling on the merits or even whether the RICO claim survives a motion to dismiss, the court reversed the district court's order. Spirit will at least have to deal with dismissing the suit -- which will probably fail, given that Ray appears to have stated enough facts that, if true, would make a case. Hopefully Spirit's legal team won't charge too much in additional fees.

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