Dazo v. Globe Airport Security Services

• Decision Date: 01 July 2002
• Docket Number: No. 00-15058.,00-15058.
• Citation: 295 F.3d 934
• Parties: Ester DAZO, an individual, Plaintiff-Appellant, v. GLOBE AIRPORT SECURITY SERVICES, a Delaware corporation; Trans World Airlines, Inc., a Delaware corporation; Continental Airlines Inc., a Delaware corporation; America West Airlines, a Delaware corporation, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

295 F.3d 934

Ester DAZO, an individual, Plaintiff-Appellant, v. GLOBE AIRPORT SECURITY SERVICES, a Delaware corporation; Trans World Airlines, Inc., a Delaware corporation; Continental Airlines Inc., a Delaware corporation; America West Airlines, a Delaware corporation, Defendants-Appellees.

No. 00-15058.

United States Court of Appeals, Ninth Circuit.

Submitted May 16, 2001.^*

Opinion Filed October 11, 2001.

Filed July 1, 2002.

COPYRIGHT MATERIAL OMITTED

Christopher Ashworth, San Jose, CA, for the plaintiff-appellant.

Thomas P. Gmelich, Barry A. Bradley, Glendale, CA, for defendant-appellee Globe Airport Security Services.

Bonnie R. Cohen, Kymberly E. Speer, San Francisco, CA, for defendants-appellees America West Airlines, Inc., Trans World Airlines, Inc., and Continental Airlines, Inc.

Before O'SCANNLAIN, TASHIMA, and THOMAS, Circuit Judges.

ORDER

TASHIMA, Circuit Judge.

The petition for panel rehearing is granted. The opinions filed October 11, 2001, slip op. 14341, and reported at 268 F.3d 671, are withdrawn, and the opinions filed concurrently with this order are substituted in their place.

OPINION

We address the reach of the Convention for the Unification of Certain Rules Relating to International Transportation by Air, Oct. 12, 1929, 49 Stat. 3000, T.S. No. 876 (1934), reprinted in note following 49 U.S.C. § 40105 (the "Warsaw Convention" or the "Convention"), which applies to international, not domestic, air transportation. We hold that the Warsaw Convention does not apply to an airport security company rendering services to both international and domestic air passengers; nor does it apply to airlines that did not provide international air carriage to the plaintiff. We therefore reverse the judgment of the district court.

I

On May 12, 1999, Ester Dazo entered Terminal C of the San Jose International Airport, where she intended to board an 11:50 a.m. flight to Toronto, connecting in St. Louis. To enter the secured area of the terminal, persons must pass through a security checkpoint, where they are examined by metal detectors and their possessions are x-rayed. Globe Airport Security Services ("Globe") operates the security checkpoints at Terminal C of San Jose International on behalf of three air carriers who operate out of that terminal — America West Airlines, Inc., Trans World Airlines, Inc., and Continental Airlines (collectively the "Airlines"). At the time, both ticketed passengers and the general public were allowed to enter the secured area, which contains embarkation gates and retail establishments.

At 10:00 a.m., Dazo approached the terminal's security checkpoint. She placed her carry-on baggage on the x-ray machine conveyor belt, which carried her bags through the x-ray machine and for an additional distance of ten to fifteen feet. By the time Dazo passed through the metal detector, an unknown person or persons had taken her carry-on baggage and disappeared. According to Dazo's complaint, one of the stolen carry-on bags contained jewelry with a wholesale value of approximately $100,000 in the Philippines and considerably more in the United States.

Dazo filed this action against Globe and the Airlines, asserting claims for negligence and breach of the implied contract of bailment. She also sought punitive damages based on defendants' alleged wilful misconduct.

Globe filed a motion to dismiss Dazo's complaint for failure to state a claim upon which relief can be granted. In its motion, which the Airlines joined, Globe argued that Dazo's state law claims were preempted by the Warsaw Convention. The district court granted defendants' motion to dismiss Dazo's complaint, holding that the theft occurred while Dazo was "in the course of embarking," and, therefore, that the Warsaw Convention preempted her claims. The court also held that Dazo's allegations of wilful misconduct were insufficient to escape the Convention's limitation on liability. The district court granted Dazo leave to file an amended complaint in conformity with its ruling, but entered judgment in defendants' favor after Dazo informed the court that she did not wish to file an amended complaint. Dazo then filed this timely appeal. We have jurisdiction pursuant to 28 U.S.C. § 1291.

II

The district court's order dismissing Dazo's complaint for failure to state a claim and its decision regarding preemption are subject to de novo review. Transmission Agency of N. Cal. v. Sierra Pac. Power Co., 287 F.3d 771, 780 (9th Cir. 2002).

III

A

"The Warsaw Convention is an international treaty governing the liability of air carriers engaged in the international transportation of passengers and cargo. The Convention creates a presumption of air carrier liability but, in turn, substantially limits that liability." Ins. Co. of N. Am. v. Fed. Express Corp., 189 F.3d 914, 917 (9th Cir.1999). The Convention's purpose is "to create a uniform body of law governing the rights and responsibilities of passengers and air carriers in international air transportation." Maugnie v. Compagnie Nationale Air France, 549 F.2d 1256, 1258 (9th Cir.1977). It was intended to protect the "international air transportation industry[, which] was in its beginning stages" at the time the Convention was drafted. Id.; see also Carey v. United Airlines, 255 F.3d 1044, 1047 (9th Cir. 2001) (describing the belief "`that limitations on liability would promote the development of the fledgling commercial air industry by allowing the airlines to predict their exposure to monetary damages'") (quoting In re Korean Air Lines Disaster of Sept. 1, 1983, 932 F.2d 1475, 1484 (D.C.Cir.1991)); McCarthy v. Northwest Airlines, Inc., 56 F.3d 313, 315-16 (1st Cir.1995) (stating that the Convention "arose out of a perceived need to provide a fledgling industry with a uniform set of legal rules that would govern accidents occurring in international air travel"). The Convention caps the liability of "carriers," but it does not define that term. See Warsaw Convention, art. 22(3) ("As regards objects of which the passenger takes charge himself, the liability of the carrier shall be limited to 5,000 francs per passenger."); see also id. art. 22(1) ("carrier" liability to passengers); id. art. 22(2) ("carrier" liability for checked baggage and goods).

The Warsaw Convention applies to "all international transportation of persons, baggage, or goods performed by aircraft for hire." Id. art. 1(1). It defines "international transportation" in part as "any transportation in which, according to the contract made by the parties, the place of departure and the place of destination, whether or not there be a break in the transportation or a transshipment, are situated... within the territories of two High Contracting Parties." Id. art. 1(2). Therefore, Dazo's flight would be considered an "international flight" for purposes of the Convention, even though she was traveling first to St. Louis, and only then to Toronto.

B

The district court held that Dazo's state law claims were preempted by the Warsaw Convention because Dazo was in the "course of embarking," relying on language found in Article 17 of the Convention and on Baker v. Lansdell Protective Agency, Inc., 590 F.Supp. 165 (S.D.N.Y. 1984). The district court noted that the Warsaw Convention applies only to carriers, but concluded that it applied to Globe because it has been extended to agents of carriers, citing Kabbani v. Int'l Total Servs., 805 F.Supp. 1033 (D.D.C.1992). The facts of this case, however, do not support a finding that Globe is a "carrier" for Warsaw Convention purposes.

It is undisputed that Globe was operating the security checkpoint on behalf of all three air carriers and therefore was acting as the common agent of all three Airlines at the time of the theft.¹ It is also undisputed that only one of the three carriers actually provided the international carriage to Toronto.² Furthermore, both domestic and international passengers for all three airlines had to pass through the security checkpoint, as did non-passengers who merely wanted to access the gates or retail establishments beyond the checkpoint. Globe was conducting a security check that every airline must perform under federal law, regardless of whether the flight being boarded is a domestic or international flight, or whether the person being screened is boarding any flight at all.

From these facts, it does not follow that Globe is a Warsaw Convention "carrier." The services being rendered by Globe were not in furtherance of the contract of carriage of an international flight, but were basic airport security services required at all airports by domestic federal law, regardless of the flights' destination and regardless, in fact, of whether the person being screened was even a passenger. See 49 U.S.C. §§ 44901-44916. These security screenings are not required by the Warsaw Convention. Thus, the Warsaw Convention does not apply to this case.³

Dazo's case is distinguishable from those cases extending Warsaw Convention "carrier" status to agents of the airline providing the international carriage. None of those cases involves extending "carrier" status to a company that was a dual agent — the agent of more than one airline, including an airline with non-Warsaw Convention status. For example, Reed v. Wiser, 555 F.2d 1079 (2d Cir.1977) simply involved the airline's own employees. See id. at 1081. In re Air Disaster at Lockerbie, Scotland, 776 F.Supp. 710 (E.D.N.Y.1991), involved a security company that was a wholly-owned subsidiary of the airline involved. See id. at 711 n. 2. Kabbani and Baker each involved, as far as the record shows, a security company that was the agent exclusively of the air carrier involved. See Kabbani, 805 F.Supp. at 1033-34; Baker, 590 F.Supp. at 170. Thus, no case supports the proposition that a security company that is acting as the common agent of multiple airlines, domestic and international, and providing basic airport security...