Filed: Sep. 23, 2014
Latest Update: Mar. 02, 2020
Summary: Case: 13-15681 Date Filed: 09/23/2014 Page: 1 of 18 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 13-15681 _ D.C. Docket No. 0:12-cv-61528-RNS BRYAN RAY, on behalf of himself and all others similarly situated, GRETEL DORTA, et al., Plaintiffs - Appellants, versus SPIRIT AIRLINES, INC., a Delaware corporation, Defendant - Appellee. _ Appeal from the United States District Court for the Southern District of Florida _ (September 23, 2014) Before HULL, MARCUS and HIL
Summary: Case: 13-15681 Date Filed: 09/23/2014 Page: 1 of 18 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 13-15681 _ D.C. Docket No. 0:12-cv-61528-RNS BRYAN RAY, on behalf of himself and all others similarly situated, GRETEL DORTA, et al., Plaintiffs - Appellants, versus SPIRIT AIRLINES, INC., a Delaware corporation, Defendant - Appellee. _ Appeal from the United States District Court for the Southern District of Florida _ (September 23, 2014) Before HULL, MARCUS and HILL..
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Case: 13-15681 Date Filed: 09/23/2014 Page: 1 of 18
[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 13-15681
________________________
D.C. Docket No. 0:12-cv-61528-RNS
BRYAN RAY,
on behalf of himself and all others similarly situated,
GRETEL DORTA, et al.,
Plaintiffs - Appellants,
versus
SPIRIT AIRLINES, INC.,
a Delaware corporation,
Defendant - Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(September 23, 2014)
Before HULL, MARCUS and HILL, Circuit Judges.
MARCUS, Circuit Judge:
Plaintiffs commenced this civil suit against Spirit Airlines, Inc. (“Spirit”)
under the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C.
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§§ 1961-68, alleging that Spirit conducted an enterprise by means of racketeering
activity -- here, two or more predicate acts of mail and wire fraud involving the
concealment and misrepresentation of airfares and user fees. The district court
dismissed the action, ruling that comprehensive federal regulation of the airline
industry precluded Plaintiffs’ civil RICO claims. We disagree. Because federal
laws do not preempt 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Plaintiffs’ claims only if Congress had repealed the provisions of RICO, at least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. Congress did not do so expressly
through the Airline Deregulation Act of 1978 (ADA), Pub. L. No. 95-504, 92 Stat.
1705. And we find no “repeal by implication” because Congress has not exhibited
the requisite clear and manifest intent. E.g., Posadas v. Nat’l City Bank of N.Y.,
296 U.S. 497, 503 (1936). The ADA explicitly preempted state laws but, notably,
said nothing about any federal cause of action. Moreover, a saving clause found in
the ADA did not disturb any other remedies provided by law. Quite simply, the
two laws are not irreconcilably in conflict, nor was the ADA clearly intended as a
substitute for RICO. Applying the strong presumption against implied repeals, we
are constrained to conclude that RICO supplements, rather than subverts, federal
regulation of air carriers.
Our decision in no way addresses whether Plaintiffs adequately alleged the
elements of their civil RICO claim under Ashcroft v. Iqbal,
556 U.S. 662 (2009),
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and Bell Atlantic Corp. v. Twombly,
550 U.S. 544 (2007). Thus, we have no
occasion today to pass any judgment on whether fraud is pled with particularity, or
whether Plaintiffs adequately pled the elements of mail and wire fraud, or indeed
whether Plaintiffs sufficiently pled a RICO injury. All we hold today is that the
federal regulatory scheme governing the airline industry does not preclude a claim
founded on the civil provisions of RICO.
I.
Plaintiffs’ second amended complaint alleged the following basic facts.
Spirit holds itself out as an “Ultra Low Cost Carrier” offering airfares at rates far
lower than other providers. These cheap fares disguise the total cost of travel
because Spirit forces consumers to pay unbundled charges traditionally included in
the price of an airline ticket. Specifically, Spirit charges a Passenger Usage Fee to
all consumers who buy tickets through its website or call center. When searching
for flights on Spirit’s website, a consumer sees only the base fares. Once he has
selected a flight, a webpage directs him to “confirm” the flight on a page that
displays both the base fare and an undifferentiated amount labeled “Taxes & Fees.”
For a breakdown of these charges, the consumer then must click on an additional
link, “more information,” which lists “Passenger Usage Fee” alongside
government taxes and fees.
Plaintiffs filed a class action complaint in the United States District Court
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for the Southern District of Florida, alleging that Spirit concealed the existence and
purpose of the Passenger Usage Fee between approximately 2008 and 2011 and
used the mails and wires to execute the scheme or artifice to defraud, thereby
yielding civil RICO liability. Spirit moved to dismiss the action pursuant to
Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which
relief could be granted. Spirit argued that permitting Plaintiffs’ RICO action
would thwart Congress’s intent to delegate entirely the regulation of airline ticket
prices and price advertising to the Department of Transportation (DOT). Spirit
also argued that Plaintiffs’ RICO claims were precluded by the ADA’s preemption
provision. Alternatively, Spirit urged that Plaintiffs had failed to adequately plead
RICO mail and wire fraud related to the Passenger Usage Fee.
The district court granted Spirit’s motion to dismiss, finding that Congress
intended the DOT to be the sole legal control on deceptive airfare, fees, and
deceptive fee and fare advertising. Therefore, the broad federal remedial scheme
precluded Plaintiffs from challenging the Passenger Usage Fee through a civil
RICO action. The district court had no occasion to address whether the complaint
adequately and with sufficient particularity pled the elements of wire and mail
fraud and civil RICO on this claim. The district court, however, did find that
Plaintiffs alleged a separate misrepresentation or scheme to defraud not related to
fees, fares, or advertising that was not precluded by federal regulations: Spirit’s
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marketing materials encouraged consumers to book tickets online but failed to
disclose that online purchases carried an additional fee. Still, the district court
dismissed that RICO claim because Plaintiffs had failed to properly allege a
predicate act and injury. The court granted leave to file a third amended complaint
setting forth a RICO claim related to the buy-online marketing. Plaintiffs,
however, filed notice of their intention not to amend the complaint, and the district
court entered final judgment. Plaintiffs timely appealed, raising a single issue:
whether the district court erred in determining that a civil RICO action related to
the Passenger Usage Fee was precluded by the federal scheme of airline regulation.
II.
We review de novo the grant of a Rule 12(b)(6) motion to dismiss for failure
to state a claim. Simpson v. Sanderson Farms, Inc.,
744 F.3d 702, 705 (11th Cir.
2014). We accept, as we must at this stage, the allegations in the complaint as true
and construe them in the light most favorable to Plaintiffs. Ironworkers Local
Union 68 v. AstraZeneca Pharm., LP,
634 F.3d 1352, 1359 (11th Cir. 2011). To
survive a Rule 12(b)(6) motion to dismiss, a complaint must plead “enough facts to
state a claim to relief that is plausible on its face.”
Twombly, 550 U.S. at 570. “A
claim has facial plausibility when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant is liable for the
misconduct alleged.”
Iqbal, 556 U.S. at 678.
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The Federal Aviation Act (FAA), Pub. L. No. 85-726, 72 Stat. 731 (1958),
gives the DOT the power to “investigate and decide whether an air carrier . . . 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).1 The DOT may order an air carrier to stop an unfair or deceptive
practice or method and may impose civil penalties of no more than $25,000 for
each day of these violations.
Id. § 41712(a); id. § 46301(a)(1) (“A person is liable
to the United States Government for a civil penalty of not more than $25,000 . . .
for violating . . . [§ 41712] . . . .”);
id. § 46301(a)(2) (“A separate violation occurs
under this subsection for each day the violation . . . continues . . . .”). The DOT’s
“full-fare advertising rule” deems unfair and deceptive any price advertising for air
transportation that does not state the “entire price to be paid by the customer.” 14
C.F.R. § 399.84(a) (“Although charges included within the single total price listed
(e.g., government taxes) may be stated separately or through links or ‘pop ups’ on
1
When enacted in 1958, the FAA conveyed this authority on the Civil Aeronautics Board
(CAB), but the power passed to the DOT in 1985. In full, § 41712(a) provides:
In general.-- On the initiative of the Secretary of Transportation or the complaint
of an air carrier, foreign air carrier, or ticket agent, and if the Secretary considers
it is in the public interest, the Secretary may 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. If the Secretary, after notice and an opportunity for a
hearing, finds that an air carrier, foreign air carrier, or ticket agent is engaged in
an unfair or deceptive practice or unfair method of competition, the Secretary
shall order the air carrier, foreign air carrier, or ticket agent to stop the practice or
method.
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websites that display the total price, such charges may not be false or misleading,
may not be displayed prominently, may not be presented in the same or larger size
as the total price, and must provide cost information on a per passenger basis that
accurately reflects the cost of the item covered by the charge.”).
When first enacted, the FAA provided that it did not “in any way abridge or
alter the remedies now existing at common law or by statute.” Pub. L. No. 85-726,
§ 1106, 72 Stat. at 798. Instead, Congress wrote, its provisions “are in addition to
such remedies.”
Id. The 1978 ADA, however, contained a preemption provision
expressly prohibiting “a State” from “enact[ing] or enforc[ing] 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). At the same time, the ADA included a saving clause to the
effect that “[a] remedy under this part is in addition to any other remedies provided
by law.”
Id. § 40120(c).
Meanwhile, in 1970 Congress enacted RICO, which created both criminal
and civil liability for “racketeering activity” connected to interstate commerce. 18
U.S.C. § 1962. Section 1961(1) of RICO defines racketeering activity to include
acts indictable as mail fraud,
id. § 1341, and wire fraud,
id. § 1343. RICO
provides criminal penalties, but also allows “[a]ny person injured in his business or
property” by a RICO violation to sue to recover treble damages, as well as fees and
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costs.
Id. § 1964(c). To recover, a civil plaintiff must establish that a defendant
(1) operated or managed (2) an enterprise (3) through a pattern (4) of racketeering
activity that included at least two racketeering acts. Reves v. Ernst & Young,
507
U.S. 170, 172, 185 (1993); Sedima, S.P.R.L. v. Imrex Co.,
473 U.S. 479, 496 &
n.14 (1985). In addition, “the plaintiff only has standing if, and can only recover to
the extent that, he has been injured in his business or property by the conduct
constituting the violation.”
Sedima, 473 U.S. at 496.
Though the FAA and ADA do not provide a private right of action, RICO
created a separate statutory action that allows plaintiffs to recover for injuries
caused by the operation of an enterprise through a pattern of racketeering activity.
In this case, Plaintiffs do not attempt to enforce FAA restrictions on unfair and
deceptive practices or methods of competition, nor do they seek relief on the
ground that Spirit violated the DOT’s full-fare advertising rule. Instead, their
claim depends on RICO’s independent federal prohibition on mail and wire fraud.
This is not a preemption case. Federal preemption of state laws is a creature
of the Supremacy Clause. See U.S. Const. art. VI, cl. 2 (“This Constitution, and the
Laws of the United States which shall be made in Pursuance thereof . . . shall be
the supreme Law of the Land . . . .”); Altria Grp. v. Good,
555 U.S. 70, 76 (2008)
(“[W]e have long recognized that state laws that conflict with federal law are
‘without effect.’” (quoting Maryland v. Louisiana,
451 U.S. 725, 746 (1981))).
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But federal statutes do not preempt other federal statutes. See, e.g., Baker v. IBP,
Inc.,
357 F.3d 685, 688 (7th Cir. 2004). Rather, this case involves the interplay
between two statutory schemes created by Congress for different reasons and at
different times. Nevertheless, Spirit claims to find a profound conflict between
federal air regulation and the application of civil RICO. If Spirit is right, “[t]he
term for this dynamic is repeal -- whether and how a later act of Congress modifies
an earlier one.” Miccosukee Tribe of Indians of Fla. v. U.S. Army Corps of
Eng’rs,
619 F.3d 1289, 1296 (11th Cir. 2010) (emphasis added);
id. (“Another
name for it is exemption.”).
The essential problem here is that Spirit does not -- and cannot -- argue that
Congress has expressly repealed the application of the civil provisions of RICO by
codifying the ADA. See
id. Thus, Plaintiffs’ RICO claims would be precluded
only if the ADA implicitly repealed RICO’s authorization of civil claims related to
airline prices and fees. But “[t]he cardinal rule is that repeals by implication are
not favored.”
Posadas, 296 U.S. at 503; accord TVA v. Hill,
437 U.S. 153, 189
(1978); Aldana v. Del Monte Fresh Produce, N.A., Inc.,
416 F.3d 1242, 1251 (11th
Cir. 2005) (per curiam); see Samuels v. District of Columbia,
770 F.2d 184, 194
n.7 (D.C. Cir. 1985) (“[R]epeals [by implication] are strongly disfavored on the
ground that Congress is normally expected to be aware of its previous enactments
and to provide a clear statement of repeal if it intends to extinguish an extant
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remedy.”). We apply a strong presumption against finding repeals by implication
precisely because they involve so much speculation about congressional intent.
Miccosukee
Tribe, 619 F.3d at 1299. Thus, when Congress passes two statutes
that may touch on the same subject, we give effect to both unless doing so would
be impossible. J.E.M. Ag Supply, Inc. v. Pioneer Hi-Bred Int’l, Inc.,
534 U.S. 124,
143-44 (2001); Morton v. Mancari,
417 U.S. 535, 551 (1974);
Posadas, 296 U.S. at
503. We must “assiduously attempt” to construe two statutes in harmony before
concluding that one impliedly repeals the other. Miccosukee
Tribe, 619 F.3d at
1299 (quoting Tug Allie-B, Inc. v. United States,
273 F.3d 936, 952 (11th Cir.
2001)).
The Supreme Court has instructed that repeals by implication may only be
found when Congress’s intent to repeal is “clear and manifest.” Rodriguez v.
United States,
480 U.S. 522, 524 (1987) (quoting United States v. Borden Co.,
308
U.S. 188, 198 (1939)). We may infer clear and manifest intent from the existence
of an “irreconcilable conflict.”
Id. (quoting Kremer v. Chem. Constr. Corp.,
456
U.S. 461, 468 (1982)); see Wood v. United States,
41 U.S. 342, 363 (1842)
(“[T]here must be a positive repugnancy between the provisions of the new law,
and those of the old; and even then, the old law is repealed by implication, only pro
tanto, to the extent of the repugnancy.”). We also may find an implied repeal when
“the later act covers the whole subject of the earlier one and is clearly intended as a
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substitute.”
Posadas, 296 U.S. at 503; accord Town of Red Rock v. Henry,
106
U.S. 596, 601 (1883). Still, it is not enough to establish that a later law covers
some or even all of the cases provided for by an earlier law, because the
subsequent statute “may be merely affirmative, or cumulative or auxiliary.”
Wood, 41 U.S. at 362-63.
As a matter of chronological necessity, the 1958 FAA could not have
repealed any part of the yet-to-be-born 1970 RICO statute. Regardless of whether
the FAA established a “comprehensive federal regulatory scheme governing air
carriers,” Musson Theatrical, Inc. v. Fed. Express Corp.,
89 F.3d 1244, 1250 (6th
Cir. 1996), Spirit cannot claim implied repeal through the FAA because Congress
enacted RICO on top of its framework.
Nor did Congress give any indication that the 1978 ADA repealed the
portion of RICO authorizing civil claims predicated on mail and wire fraud. In the
first place, there is no irreconcilable conflict between the two laws. The ADA
substantially deregulated the airline industry in an effort to place “maximum
reliance on competitive market forces.” Morales v. Trans World Airlines, Inc.,
504
U.S. 374, 378 (1992). To ensure its work was not undone by state regulation, the
ADA amended the FAA to expressly preempt state laws relating to an air carrier’s
price, route, or service. 49 U.S.C. § 41713. The statutory text and legislative
history indicate that the preemption provision was included to delineate areas of
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federal and state responsibility in a way that would avoid conflicting demands on
air carriers. See House Report No. 95-1211, 1978 U.S.C.C.A.N. at 3752. The
ADA said nothing about federal laws in this area, which strongly signals that
Congress meant not to disturb them. Cf., e.g., Cipollone v. Liggett Grp., Inc.,
505
U.S. 504, 517 (1992) (“Congress’ enactment of a provision defining the pre-
emptive reach of a statute implies that matters beyond that reach are not pre-
empted.”); Branche v. Airtran Airways, Inc.,
342 F.3d 1248, 1253 (11th Cir. 2003)
(“[W]here Congress has chosen to explicitly address the issue of pre-emption, . . .
it generally is inappropriate to look beyond that provision to imply pre-emption
from the statute’s substantive dictates.”).
Congress even more clearly indicated that the ADA did not interrupt federal
RICO actions by including a saving clause, which expressly stated that remedies
provided by federal air commerce and safety regulations are in addition to other
remedies provided by law. 49 U.S.C. § 40120(c); cf. Geier v. Am. Honda Motor
Co.,
529 U.S. 861, 868 (2000) (“The language of the pre-emption provision
permits a narrow reading that excludes common-law actions. Given the presence
of the saving clause, we conclude that the pre-emption clause must be so read.”).
The legislative history indicates no “unambiguous congressional perception” that
the ADA was designed to exempt a civil RICO claim predicated on acts of mail
and wire fraud somehow involving airline fees, prices, or advertising. See Brown
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v. Gen. Servs. Admin.,
425 U.S. 820, 828-29 (1976). Nor does the legislative
history signal that Congress gave the slightest consideration to the partial repeal of
RICO, let alone to suggest “that Congress consciously abandoned its (prior)
policy.” Radzanower v. Touche Ross & Co.,
426 U.S. 148, 157-58 (1976)
(quoting
Morton, 417 U.S. at 551). Simply put, nothing in the statute nor the
legislative history indicates an intent on the part of Congress to create an
exemption from federal RICO when it divided federal and state responsibility for
airline regulation.
Moreover, we recognize the two federal remedial schemes as “capable of co-
existence” because they feature different requirements and offer different
protections. ICC v. S. Ry. Co.,
543 F.2d 534, 539 (5th Cir. 1976); 2 see J.E.M. Ag
Supply, 534 U.S. at 144. DOT’s administrative process provides for a lower level
of culpability but less severe sanctions. DOT need not find deceptive intent, fraud,
or injury before levying penalties or ordering a carrier to alter an unfair or
deceptive practice or an unfair method of competition. 49 U.S.C. § 41712; Am.
Airlines v. N. Am. Airlines,
351 U.S. 79, 85-86 (1956). But these penalties do not
compensate consumers for their injuries; instead, fines are paid to the United States
Treasury and are capped at comparatively modest levels. 49 U.S.C. § 46301(a).
In sharp contrast, in order to sustain a private civil RICO action, the
2
In Bonner v. City of Prichard,
661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), we adopted as
binding precedent all decisions of the former Fifth Circuit handed down before October 1, 1981.
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plaintiffs must plead far more than the existence of an unfair or deceptive practice
or an unfair method of competition. RICO requires proof that the defendant
operated or managed an enterprise through a pattern of racketeering activity that
injured the plaintiff. For civil RICO claims predicated on acts of mail and wire
fraud, the plaintiff must establish that the defendant devised or intended to devise a
scheme or artifice to defraud, and that the defendant used the mail or interstate
wire, radio, or television communication for the purpose of executing that scheme
or artifice. See 18 U.S.C. §§ 1341, 1343, 1961(1); Durland v. United States,
161
U.S. 306, 315 (1896) (describing elements of mail fraud). Unlike with the DOT
regulations, then, mail and wire fraud require “that a defendant actually intended to
create a scheme to defraud.” United States v. Svete,
556 F.3d 1157, 1165 (11th
Cir. 2009) (en banc). Mail and wire fraud are specific intent crimes, requiring that
a defendant acted with bad purpose either to disobey or disregard the law. United
States v. Ettinger,
344 F.3d 1149, 1160 (11th Cir. 2003); see United States v.
Maxwell,
579 F.3d 1282, 1302 (11th Cir. 2009) (“[T]he specific intent required
under the mail and wire fraud statutes is the intent to defraud . . . .”). If defendants
are culpable under this more demanding standard, civil RICO’s treble damages
provision compensates plaintiffs, and at a far greater cost to defendants than
DOT’s limited penalties. See 18 U.S.C. § 1964(c). There is no inconsistency in a
federal system that creates tiered levels of liability by providing stiffer sanctions
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when an air carrier is involved in criminal fraud, not merely engaged in an unfair
or deceptive act. Cf. United States v. Boffa,
688 F.2d 919, 933 (3d Cir. 1982)
(“That the mail fraud statute makes criminal activity that may also be proscribed
by the NLRA does not render the former statute ‘positively repugnant’ to the
latter.”).
Similarly, the ADA does not cover the whole subject of, and is not clearly
intended as a substitute for, RICO. The different remedial means we’ve described
serve different legislative purposes. DOT’s regulation of unfair and deceptive
practices seek to promote fair competition among carriers, while civil RICO targets
a broad category of criminally fraudulent acts not restricted to air carriers, pricing,
or advertising. Cf.
Radzanower, 426 U.S. at 157 (finding no implied repeal when
“[t]he 1934 Act was enacted primarily to halt securities fraud, not to regulate
banks”). The ADA was a wholly different animal from RICO, which “was an
aggressive initiative to supplement old remedies and develop new methods for
fighting crime.”
Sedima, 473 U.S. at 498. “When we consider the different
objects which it is reasonably clear the legislature had in view in the passage of
these two acts, it is a fair construction to hold that it was not the intention of the
legislature, by the passage of the later act, to repeal the older act, either totally or
partially.” Red
Rock, 106 U.S. at 603.
While Spirit may prefer a narrow interpretation of RICO, Congress
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expressly admonished that the statute is to “be liberally construed to effectuate its
remedial purposes.”
Sedima, 473 U.S. at 498 (quoting RICO, Pub. L. No. 91-452,
§ 904(a), 84 Stat. at 947). When confronted with “extraordinary” uses of civil
RICO that “appear to be primarily the result of the breadth of the predicate
offenses, in particular the inclusion of wire, mail, and securities fraud,” the
Supreme Court has refused to engage in “statutory amendment”: “correction must
lie with Congress.”
Id. at 499-500. We can divine no clear and manifest
congressional intent for the ADA to have made such an alteration to RICO.
Spirit relies on Ayres v. General Motors Corp.,
234 F.3d 514 (11th Cir.
2000), but that precedent offers little guidance in this case. The Ayres plaintiffs
claimed that the defendants had breached a duty to disclose alleged safety defects
as required by the National Traffic and Motor Vehicle Safety Act (“Safety Act”),
and that this breach necessarily gave rise to the predicate acts of mail and wire
fraud under Georgia’s RICO statute.
Id. at 516-17. We found “it clear that
Congress did not intend to equate a violation of the Safety Act’s notification
requirements in and of itself with the felony of mail or wire fraud.”
Id. at 522. In
other words, plaintiffs could not use the Safety Act’s regulatory scheme, which
featured “its own extensive array of administrative remedies for a violation of its
notification obligations,” to establish a RICO predicate act of mail or wire fraud
where none could otherwise be shown.
Id. But under Ayres a plaintiff still “can
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show a scheme to defraud if he proves that some type of deceptive conduct
occurred.”
Id. at 521. He simply cannot use the Safety Act to establish that the
defendant pursued a fraudulent scheme and used the mails or wires to execute that
scheme, all in violation of RICO.
In this case, however, the Plaintiffs have not alleged that the FAA, the ADA,
or DOT regulations expand the scope of RICO by spawning new predicate acts.
Plaintiffs do not argue that a previous DOT ruling on unfair or deceptive
advertising proves the existence of a predicate act of mail or wire fraud. Simply
put, the district court was concerned that the federal statutes overlap. But that is
how Congress wrote them. Sometimes a defendant’s actions may qualify both as
unfair and deceptive advertising under the FAA and as mail or wire fraud under
federal criminal statutes. So long as Plaintiffs do not argue that violation of the
first establishes the second, our precedent does not restrict their RICO action.
The only other federal court to confront a RICO action like Plaintiffs’ found
no preclusion from the ADA. See All World Prof’l Travel Servs., Inc. v. Am.
Airlines, Inc.,
282 F. Supp. 2d 1161 (C.D. Cal. 2003). In All World, a travel
agency sued an airline in a dispute over cancellation fees charged for flights in the
months following September 11, 2001. The court recognized that the plaintiffs
could have complained to the DOT, but held that “Congress did not intend to
require the type of conduct alleged in the Complaint” -- including mail and wire
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fraud -- “to be submitted to the DOT.”
Id. at 1166. Just as in this case, the airline
insisted that the comprehensiveness of the ADA precluded the travel agency from
challenging airline fees “in the guise of a RICO claim.”
Id. at 1172. The court
was unmoved because the RICO claims were based on mail and wire fraud instead
of ADA violations, because the ADA was not intended to completely subsume the
field of airline liability, and because no provision in the ADA conflicted with
RICO.
Id. at 1172-74. For the reasons we’ve explained, we agree with the All
World court that civil RICO claims predicated on mail and wire fraud are not
precluded by the ADA simply because they involve fraud arising out of pricing,
fees, and advertising in the airline industry.
We vacate the dismissal of Plaintiffs’ claim tied to Spirit’s Personal Usage
Fee because Congress did not expressly or impliedly repeal RICO’s authorization
of civil suits based on acts of mail and wire fraud. Again, we pass no judgment on
whether Plaintiffs have adequately pled a RICO claim, and remand to allow the
district court to make that determination.
VACATED AND REMANDED.
18