FAA

  • August 4, 2011
    Guest Post

    By Edgar James and Danny Rosenthal, who practice airline and rail labor law in Washington, D.C. Both are ACS members.  


    Although Congress has apparently reached a deal to temporarily end the Federal Aviation Administration (FAA) shutdown, the larger fight over FAA funding continues as Democrats and Republicans wrangle over a permanent extension of funding. The key holdup revolves around a basic question of democracy and a relatively unknown federal agency. The question is this:  For a union to be elected at a railroad or airline, should approval be required by a majority of those who cast votes or, instead, by a majority of all eligible voters?  The agency is the National Mediation Board, which conducts elections to determine if workers in the airline and railroad industries wish to become unionized.  (In other industries, elections are conducted by the Board’s more famous cousin, the National Labor Relations Board.) 

    The current standoff can be traced to May 2010, when the National Mediation Board amended its regulations regarding elections. By federal statute, the Board has the authority to choose “any appropriate method” for conducting elections. Until last year, the Board’s general policy was to require approval by a majority of all eligible voters in order to certify a union.  But this approach had serious problems. It assumed that non-voting employees were against unionization when they might simply have been uninterested or unable to vote.  In many elections, the voting rolls included furloughed employees who had not been active for years.  So the Board changed its policy after a period for notice and comment. The change was approved by two of the Board’s three members, one Obama appointee and one Bush appointee (re-nominated by Obama in 2009).  

    Of course, airlines didn’t like the new rule.  Delta, under investigation by the Board, was the biggest opponent. Today, Republicans, backed by a variety of conservative allies, are insisting that any permanent FAA reauthorization include a provision overturning the regulation.  While it’s not the only issue in the standoff, observers have identified it as the “real dealbreaker” and the “big issue” preventing a resolution. 

    The Republicans’ main argument against the regulation is that it reversed 75 years of Board policy. That’s what Congressman John Mica (R-Fla.), chairman of the House transportation committee, said in a statement following the enactment of the regulation. It’s also how conservative commentators have blasted the new policy. But it’s not a convincing argument.

  • April 27, 2011

    The Supreme Court led by its conservative wing issued an opinion limiting states’ ability to nullify contracts that prohibit class action arbitration.

    In AT&T Mobility v. Concepcion, Justice Antonin Scalia writing for the 5-4 majority concluded that a provision of the Federal Arbitration Act (FAA) bars enforcement of a California law that nullifies contracts that prohibit class-action arbitration. Scalia was joined by Chief Justice John Roberts, Anthony Kennedy, Clarence Thomas and Samuel Alito. The opinion overturns a ruling by the U.S. Court of Appeals for the Ninth Circuit, which found that the FAA provision did not preempt the California law.

    Scalia wrote that the “overarching purpose of the FAA … is to ensure the enforcement of arbitration agreements according to their terms so as to facilitate streamlined proceedings. Requiring the availability of classwide arbitration interferes with fundamental attributes of arbitration and thus creates a scheme inconsistent with the FAA.”

    Justice Stephen Breyer, joined by Justices Ginsburg, Sotomayor and Kagan, lodged a dissent, arguing that California’s law “is consistent with the federal Act’s language and primary objective.”

    Breyer added, “California is free to define unconscionability as it sees fit, and its common law is of no federal concern so long as the state does not adopt a special rule that disfavors arbitration.”

    The Associated Press says today’s opinion “could greatly restrict the use of class actions, in which a party represents a much larger group, in disputes over contracts.”

    In a guest post for ACSblog, Public Justice’s Paul Bland Jr. charged that the “corporatist idea that the FAA preempts all state law limiting class-action bans hasn’t caught on in the lower courts because there is no serious legal or intellectual basis for it. If the Supreme Court decides to completely federalize the law in this area, it will have to invent from whole cloth new federal law that is not supported by anything in the language of the FAA or in its history.”

    Bland also participated in an ACS briefing on the AT&T Mobility v. Concepcion case. Video of the briefing, which included a panel discussion, is available here.

    Update: Senate Judiciary Chairman Patrick Leahy, in a statement on the opinion, said, "The opinion of five Supreme Court Justices in AT&T v. Concepcion will further weaken protections for consumers. The divided court decided that state laws which would protect consumers' rights to band together are preempted by Federal law. This is the latest in a series of cases where five conservative justices have hampered the rights of consumers to be protected by state laws. Class actions are an effective way to ensure consumer protection, but today's opinion by the Roberts Court continued to move in a direction that undermines this access to justice for hardworking Americans."