Air Wisconsin Airlines v. Hoeper

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Issues 

Can a court deny an airline immunity under the Aviation and Transportation Security Act for a report made by its employees to the Transportation Security Administration about another employee, without first determining that the airline's disclosure was materially false?

Oral argument: 
December 9, 2013
Court below: 

Former co-workers reported pilot William Hoeper to the Transportation Security Administration ("TSA"), claiming they were concerned that Hoeper, who was about to fly home as a passenger, was mentally agitated and might be armed. Hoeper sued Air Wisconsin for defamation, alleging that the co-workers’ statements to the TSA were misleading and the result of animosity against him. The Court will decide whether immunity under the Aviation and Transportation Security Act ("ATSA"), which would cover statements made by airlines to the TSA, can be denied without a court first determining that the disclosure was false. While Hoeper argues that his co-workers’ statements were clearly materially false, Air Wisconsin argues that the lower court needed to make a determination that the statements were false before denying immunity to Air Wisconsin. The Supreme Court’s ruling in this case will have a direct impact on the scope of protection for airlines that report suspicious activities to the TSA. The Court’s ruling may also have a broader impact on First Amendment jurisprudence.

Questions as Framed for the Court by the Parties 

  1. Whether a court can deny ATSA immunity without deciding whether the airline's report was true.
  2. Whether the First Amendment requires a reviewing court in a defamation case to make an independent examination of the record before affirming that a plaintiff met its burden of proving a statement was false.

Note: The Court granted certiorari to Question 1 presented by the petition.

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Facts

William Hoeper was a pilot for Air Wisconsin Airlines Corporation (“Air Wisconsin”) from 1998 to 2004. The Transportation Security Administration ("TSA") authorized Hoeper as a federal flight deck officer (“FFDO”) under a federal statute that enables pilots to defend air carriers from “acts of criminal violence or air piracy.” Because he was a FFDO, the TSA issued Hoeper a firearm.

After Air Wisconsin discontinued the type of aircraft Hoeper had piloted for several years, Air Wisconsin required Hoeper to pass a certification test before he could pilot another type of aircraft. Hoeper failed the certification test three times. After he failed the test a third time, Air Wisconsin gave Hoeper one last opportunity to pass the proficiency test. Mark Schuerman, an Air Wisconsin administrator, later testified that Hoeper ended the final test abruptly because he believed the test administrators were deliberately sabotaging him, and Hoeper became very angry.

Soon after the test, Schuerman told Patrick Doyle, a manager at Air Wisconsin, about the confrontation with Hoeper. Schuerman did not say that he thought Hoeper would harm others. Doyle told an Air Wisconsin employee to drive Hoeper to the airport so that Hoeper could fly home from the testing center. Before Hoeper flew home, Doyle and several Air Wisconsin administrators, including Kevin LaWare, an Air Wisconsin vice president, discussed Hoeper’s conduct. The Air Wisconsin officials later testified that although they had discussed Hoeper’s FFDO status, they had no reason to think that Hoeper was harmed.Still, LaWare decided they should contact the TSA. LaWare, however, testified that he did not want Doyle to tell the TSA that Hoeper may be armed. Doyle called the TSA to report Hoeper as a possible threat, saying that Hoeper was an FFDO pilot who may be armed. Doyle explained that the airline was concerned about his mental stability and the whereabouts of his firearm, and that Air Wisconsin terminated Hoeper that day.

After Hoeper boarded the aircraft taking him home, the TSA stopped the aircraft and armed officers removed Hoeper. The TSA detained and questioned Hoeper before releasing him.

Hoeper sued Air Wisconsin for defamation. At trial, the City and County of Denver District Court instructed the jury on the Aviation and Transportation Security Act (“ATSA”), which gives civil suit immunity to any airline security officer (or other agent involved with airport security) for “making a voluntary disclosure” of any suspicious activities as long as the disclosure was not reckless or made with knowledge that the statement was inaccurate or misleading. The jury returned a verdict in favor of Hoeper, determining that Air Wisconsin made statements “knowing they were false, or so recklessly as to amount a willful disregard for the truth.”

The Colorado Court of Appeals affirmed. The Colorado Supreme Court held that the matter of immunity must be determined by the court, not the jury, but also found that Air Wisconsin was not entitled to immunity under the ATSA. The Supreme Court granted certiorari in part on June 17, 2013 to determine whether a court can deny ATSA immunity without first determining whether the airline’s statement to the TSA was true or false.

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Discussion

Air Wisconsin argues that the exceptions to ATSA immunity do not apply when an airline’s report is true. While Hoeper argues that Air Wisconsin did not properly raise the defense that Doyle’s statements were not materially false in prior proceedings, Hoeper also argues that Congress meant to deny immunity to those who make bad faith reports.

AIRLINE SECURITY CONCERNS

Air Wisconsin and its supporters argue that greater restrictions on ATSA immunity would discourage airline employees from reporting suspicious activities, and would therefore hinder the TSA’s ability to address potential threats to national security. Congressman John Mica, one of the authors of the ATSA, argues that affirming the Colorado State Supreme Court would undermine the purposes of the immunity provision. Congressman Mica argues that without immunity, individuals in the aviation industry will be less inclined to report potential threats for fear of lawsuits.

The Voice of the Defense Bar (“DRI”), in support of Air Wisconsin, argues that the Colorado Supreme Court’s ruling necessitates “hair-splitting distinctions” between the wording of a report that receives immunity and one that does not. According to DRI, affirming the lower court decision would force airlines to consult with attorneys before submitting any report to the TSA or encourage airlines to refrain from submitting a report at all in order to avoid litigation. Similarly, other supporters of Air Wisconsin contend that the $25,000 maximum penalty for failing to report an incident is trivial compared to the millions of dollars at stake in potential defamation suits; accordingly, the lower court’s ruling creates incentives to not report suspicious activity where the airline is unsure whether they will receive immunity.

Hoeper argues that a “good faith” reporting requirement is consistent with Congress’s intent to balance the competing interests of national security and unnecessary confrontations with the public. Hoeper contends that the TSA does not have time to assess all potential threats and that Congress’s intent to promote safe travel would be undermined if the law permitted airline officials to make reports in bad faith. Hoeper argues that a “good faith” standard would not implicate those who make reports that turn out to be false, as long as the reports were made in good faith, and that asking airlines to make reports in good faith is not too substantial a burden.

PROTECTIONS FOR FREE SPEECH

In support of Air Wisconsin, the First Amendment Coalition contends that this case raises broader First Amendment issues about the right to free speech. The Coalition argues that requiring proof of falsity has been a longstanding element in defamation cases, because, even though the requirement protects some untruthful speech, the requirement, more importantly, provides necessary protection for truthful speech. Similarly, the Reporters Committee for Freedom (“Reporters Committee”) and fifteen news media organizations argue that uncertainty in the law could hinder free speech if the Court requires that actual malice be determined on a case-by-case basis. The Reporters Committee further argues that the potential chilling effect in this case could reach reporters who need to quickly disseminate information but who might otherwise fear defamation claims.

Hoeper argues that state law requires a defamatory statement to be materially false and that the Colorado Supreme Court reviewed the facts in light of that standard. Hoeper says that the parties agree about the requrements of defamation law, and that they disagree only because Air Wisconsin believes the court reached the wrong conclusion after applying the law.

INCREASED COSTS FOR AIRLINE PASSENGERS

Supporters of Air Wisconsin argue that increasing airline liability will increase prices for airline passengers. For example, Airlines for America asserts that while passengers already pay up to $10 per round-trip ticket to fund TSA’s security operations, increased litigation will raise those fees.

Hoeper responds that because recklessly false statements can divert attention and resources away from true threats, arguments concerning price increases are misplaced. Moreover, Hoeper maintains that under a good faith requirement, airlines would not have to conduct independent evaluations of suspicious activity to avoid liability.

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Analysis

This case addresses the standard for determining whether statements made by air carriers and their employees to air transit officials can receive immunity under the ATSA, codified by 49 U.S.C. § 44941. Petitioner Air Wisconsin argues that a court should recognize immunity unless it determines that the statement was both material and made "with actual knowledge that the disclosure was false, inaccurate, or misleading.” Respondent Hoeper contends that the lower courts correctly analyzed the material falseness of an Air Wisconsin employee’s statement through its review of evidence to determine malice, and that immunity should not apply to reckless statements.

DEFAMATION EXCEPTION TO THE FIRST AMENDMENT

Air Wisconsin argues that a court cannot deny ATSA immunity to an airline unless the court first determines that the airline’s statements were materially false. Air Wisconsin contends that the ATSA's exceptions to immunity are narrow, and similar to the First Amendment standard for malice in defamation suits. In Air Wisconsin’s view, Congress intentionally incorporated standards for “actual malice” from the Supreme Court’s decision in a landmark defamation case, New York Times Co. v. Sullivan, 376 U.S. 254 (1964); Air Wisconsin maintains that ATSA immunity is only precluded where there is proof of material falsity. Based on its claim that New York Times grants an absolute defense to truthful statements, Air Wisconsin insists that its reports were true and therefore the ATSA protects such statements. Air Wisconsin cites Justice Eid's concurrence in the Colorado Supreme Court, arguing that the ATSA protects its statements because they were “materially true.”

In response, Hoeper argues that Congress, in enacting the ATSA, intended to withhold protection from those who act in bad faith by making “knowingly or recklessly false statements.” Hoeper insists that the ATSA does not require airlines to conduct independent investigations, but does require that they truthfully report information that they have gathered. In Hoeper’s view, if an airline makes an assessment of the facts, then it must have a good faith basis for believing that the assessment is true before reporting it. Hoeper therefore contends that the New York Times test does not excuse reckless statements simply because they are true.

ARE COURTS REQUIRED TO REVIEW STATEMENTS FOR MATERIAL FALSITY?

Air Wisconsin argues that the Colorado Supreme Court’s interpretation of the New York Times standard was incorrect in holding that the truth of a statement is not part of the analysis of whether ATSA immunity applies. According to Air Wisconsin, affirming the lower court would expose airlines to defamation liability for reporting true information to the TSA. Because Air Wisconsin argues that the New York Times standard precludes ATSA immunity only when the disclosure is materially false, it maintains that reviewing courts are bound to consider veracity when determining claims for immunity. In support of Air Wisconsin, the United States underscores the importance of reviewing the truthfulness of statements and observes that the “First Amendment would bar a defamation judgment based on a true statement.”

Hoeper accepts Air Wisconsin’s argument that disregarding a statement’s truth would raise the danger of wrongful defamation suits. However, Hoeper contends that Air Wisconsin did not ask the Colorado Supreme Court to determine whether the statements were materially true; rather, Hoeper claims, Air Wisconsin only asserted that Doyle, the employee who made the report to the TCA, did not act with actual malice. Thus, according to Hoeper, the Colorado Supreme Court did not decide whether the statements were true because they were only asked to decide whether Doyle was reckless. Hoeper also argues that the Colorado Supreme Court's failure to explicitly review the truth of the airline’s statements does not mean that it would have failed to discuss the statements’ truth in greater detail had it felt that there was a "reckless but truthful statement." Accordingly, Hoeper rejects the claim that the Colorado Supreme Court did not consider the veracity of Air Wisconsin’s statements merely because Air Wisconsin only raised “actual malice” on appeal.

ANALYZING STATEMENTS FOR MATERIAL FALSITY

Air Wisconsin acknowledges that the Colorado Supreme Court reviewed the airline’s statements for recklessness. However, Air Wisconsin argues that, by scrutinizing the difference in terms like “mental stability” and “irrational,” the lower courts unfairly denied immunity based on “nitpicking of Air Wisconsin’s phraseology” that “has no place under ATSA.” Furthermore, Air Wisconsin argues that the TSA would have understood what Doyle meant when he reported his concerns about Hoeper, and that the TSA should determine whether an incident requires TSA response, not the airline or the courts after the fact. According to Air Wisconsin, an inaccurate statement is material only if it would have had a different effect on the listener than an accurate statement. Therefore, Air Wisconsin argues, immunity still applies where the gist of a statement is accurate even if some details are inaccurate.

Hoeper counters that here a jury found that “the difference between the statement and the truth could predictably affect a reasonable security officer’s assessment of the existence, nature, or extent of any security threat.” In response to Air Wisconsin’s claims that the Colorado Supreme Court had quibbled over the details of phraseology, Hoeper dismisses such concerns because Hoeper contends that the key portions of Air Wisconsin’s statements were materially false and misleading. Hoeper thus argues that if the TSA’s response is used to gauge the materiality of a statement, then Doyle’s statement was material because of TSA’s dramatic response, which included removing Hoeper from the plane. Hoeper contends that if Doyle made a more accurate report to the TSA, it is reasonable to believe that the TSA would have responded differently. Furthermore, Hoeper asserts that the lack of blanket immunity under the ATSA demonstrates Congress’s intent not to excuse airlines from their duty to report the truth.

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Conclusion

The Supreme Court will address the proper standard for determining whether immunity applies to airlines that provide information to the TSA regarding potential threats. In determining whether or not Air Wisconsin’s statements were correctly denied ATSA immunity, the Court will decide whether a court should first determine the veracity of an airline’s statements. Air Wisconsin argues that a statement should be granted ATSA immunity unless a reviewing court finds a statement materially false. Conversely, Hoeper argues that Air Wisconsin did not properly raise the issue of truthfulness below and that immunity was properly denied because Air Wisconsin recklessly made statements about him. The Court’s ruling in this case will have a direct impact on the scope of protection for airlines that report suspicious activities to the TSA.

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