Sw. Airlines Pilots Ass'n v. The Boeing Co.

Decision Date30 March 2022
Docket Number05-20-01067-CV
PartiesSOUTHWEST AIRLINES PILOTS ASSOCIATION (SWAPA) ON BEHALF OF ITSELF AND ITS MEMBERS, Appellant v. THE BOEING COMPANY, Appellee
CourtTexas Court of Appeals

Before Justices Carlyle, Smith, and Garcia

MEMORANDUM OPINION

DENNISE GARCIA JUSTICE

In this interlocutory appeal from a plea to the jurisdiction Southwest Airlines Pilots Association ("SWAPA") challenges the trial court's final order dismissing with prejudice its common law tort claims against the Boeing Company ("Boeing"). SWAPA argues that it has standing to assert claims on its own behalf and associational standing to assert claims on behalf of its members, and even if it does not, the trial court should have allowed a pleading amendment and should not have dismissed the suit with prejudice. SWAPA further argues that the Railway Labor Act ("RLA")[1] does not preempt its state law tort claims against Boeing.

As discussed below, we conclude that SWAPA has standing to assert claims on its own behalf, but at the time the suit was filed, lacked standing to assert claims on behalf of its members. Although SWAPA's subsequently acquired assignments of member interests do not cure the jurisdictional defects in the present case, the assignments might confer standing on SWAPA to file suit in the future. Thus, while the trial court properly dismissed the suit without providing SWAPA an opportunity to amend its pleadings, the dismissal should have been without prejudice. We further conclude that the RLA does not preempt SWAPA's state law claims.

Accordingly, we reverse the trial court's order granting Boeing's plea to the jurisdiction on the claims SWAPA asserted on its own behalf. We modify the trial court's order to reflect that the claims SWAPA asserted on behalf of its members are dismissed without prejudice. As modified, the remainder of the trial court's order is affirmed.

I. Background

SWAPA is an unincorporated non-profit labor organization and employee association that represents over 9, 000 Southwest Airlines Pilots. Acting in its representative capacity, SWAPA enters into collective bargaining agreements ("CBAs") with Southwest Airlines. The CBAs define employment terms, including pay, benefits, working conditions, and the approved aircraft that the pilots agree to fly. Southwest pilots pay SWAPA a percentage of their wages as dues.

In 2016, SWAPA entered a CBA in which SWAPA agreed that its members would operate Boeing's 737 MAX aircraft. In 2018 and 2019, the 737 MAX was involved in catastrophic crashes and as a result, the 737 MAX fleet was grounded worldwide.

SWAPA subsequently initiated this suit against Boeing on behalf of itself and its members. The petition alleges that SWAPA seeks damages on behalf of itself and its pilots "who have collectively lost, and are continuing to lose, millions of dollars in compensation as a result of Boeing's false representations concerning its 737 MAX aircraft, namely that the 737 MAX was safe, airworthy, and was essentially the same as the time-tested 737 aircraft that SWAPA pilots were already flying." To this end, SWAPA asserts Texas common law claims for fraudulent and negligent misrepresentation, tortious interference with contract and with an existing business relationship, negligence, and fraud by nondisclosure. SWAPA seeks compensation for pilots in connection with cancelled or reduced flights following the grounding of the 737 MAX, in addition to its own lost dues and legal fees incurred in connection with government investigations.

Boeing removed the case to federal court, asserting that SWAPA's state law claims are completely preempted by the RLA and that the "mass action" provision of the Class Action Fairness Act creates original federal jurisdiction. SWAPA moved to remand.

While SWAPA's remand motion was pending, 8, 794 SWAPA pilots executed assignments in which they assigned and transferred to SWAPA "all rights, title, and interest to any and all claims, demands, and/or causes of action . . . against Boeing arising out of the Max Crisis" (the "Assignments"). The Assignments acknowledge that SWAPA's agreement to pursue the assignor-member's damage claims is "[c]onsistent with SWAPA's Constitution and the ordinary business it conducts in representing the interests of Southwest pilots."

The federal court concluded that it lacked subject matter jurisdiction and remanded the case to state court. Boeing filed an answer and a plea to the jurisdiction. The plea asserted that SWAPA lacks associational standing, and its claims are preempted by the RLA.

SWAPA filed a notice of assignment requesting that the Assignments be recorded in accordance with the Texas Property Code, but it did not amend or seek to amend its petition.

Boeing amended its plea to the jurisdiction. The amended plea argues that SWAPA lacks associational standing to pursue claims on behalf of its members, the Assignments do not confer standing because they violate Texas public policy relating to standing and class actions, and the RLA preempts SWAPA's state law claims.

After full briefing and some limited discovery, the trial court conducted a hearing. After the hearing, the court signed an order granting Boeing's plea and dismissing SWAPA's claims with prejudice. SWAPA moved to modify the judgment and to amend its petition and the trial court denied the motion.[2] SWAPA now appeals the trial court's orders granting the plea to the jurisdiction and denying its motion to modify the judgment.

II. Analysis
A. Standard of Review and Dilatory Pleas

A plea to the jurisdiction is a dilatory plea that challenges the trial court's subject matter jurisdiction without regard to whether the asserted claims have merit. Bland Independent School District v. Blue, 34 S.W.3d 547, 554 (Tex. 2000); see also City of San Antonio v. Maspero, __S.W.3d__, 2022 WL 495190, at *4 (Tex. 2022) (proper function of a dilatory plea does not authorize an inquiry so far into the substance of the claims that plaintiffs are required to put on their case to establish jurisdiction).

We review a trial court's ruling on a plea to the jurisdiction de novo. See Hous. Belt & Terminal Ry. Co. v. City of Hous., 487 S.W.3d 154, 160 (Tex. 2016). A jurisdictional plea may challenge the pleadings, the existence of jurisdictional facts, or both. Tex. Dep't of Criminal Justice v. Rangel, 595 S.W.3d 198, 205 (Tex. 2020) (quoting Alamo Heights Indep. Sch. Dist. v. Clark, 544 S.W.3d 755, 770 (Tex. 2018)).

The burden is on the plaintiff to affirmatively demonstrate the trial court's jurisdiction. Heckman v. Williamson Cnty., 369 S.W.3d 137, 150 (Tex. 2012). In reviewing a plea to the jurisdiction, we begin with the plaintiff's live pleadings and determine if the plaintiff has alleged facts that affirmatively demonstrate the trial court's jurisdiction to hear the cause. Texas Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004). In making this assessment, we construe the plaintiff's pleadings liberally, taking all assertions as true, and look to the plaintiff's intent. Id. If a plea to the jurisdiction challenges the existence of jurisdictional facts, we may consider evidence and must do so when necessary to resolve the jurisdictional issues raised. Id. at 227. That is, we review the evidence in the light most favorable to the nonmovant to determine whether a genuine issue of material fact exists. Town of Shady Shores v. Swanson, 590 S.W.3d 544, 550 (Tex. 2019) (citing Miranda, 133 S.W.3d at 221, 227-28). "Our ultimate inquiry is whether the plaintiff's pleaded and un-negated facts, taken as true and liberally construed with an eye to the pleader's intent, would affirmatively demonstrate a claim or claims within the trial court's jurisdiction." Brantley v. Texas Youth Comm'n, 365 S.W.3d 89, 94 (Tex. App.-Austin 2011, no pet.).

When a plaintiff fails to plead facts that establish jurisdiction, but the petition does not affirmatively demonstrate incurable defects, the issue is one of pleading sufficiency and the plaintiff should be afforded the opportunity to amend. Cty. of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex. 2002); see also Miranda, 133 S.W.3d at 226-27. If, however, the pleadings affirmatively negate the existence of jurisdiction, then the plea to the jurisdiction may be granted without allowing the plaintiff an opportunity to replead. Cty. of Cameron, 80 S.W.3d at 555.

The plea in this case was premised on the alleged absence of standing and federal preemption. "Standing is a constitutional prerequisite to suit." Heckman, 369 S.W.3d at 150 (citing Sw. Bell Tel. Co. v. Mktg. on Hold Inc., 308 S.W.3d 909, 915 (Tex. 2010)). Standing "requires a concrete injury to the plaintiff and a real controversy between the parties that will be resolved by the court." Id. at 154 (citing DaimlerChrysler Corp. v. Inman, 252 S.W.3d 299, 304, 307 (Tex. 2008)). "If a plaintiff lacks standing to assert a claim, then a court has no jurisdiction to hear it." Heckman, 369 S.W.3d at 150; Inman, 252 S.W.3d at 304).

Preemption can be jurisdictional or defensive. See Gruber v. Fuqua, 279 S.W.3d 608, 624 n.2 (Tex. 2009); Gorman v. Life Ins. Co. of N. Am., 811 S.W.2d 542, 545-546 (Tex. 1991) (forum preemption implicates a court's subject matter jurisdiction). When it is the former, it is sometimes raised in a plea to the jurisdiction. See De Los Santos v. Heldenfels Enters, Inc., 632 S.W.3d 584, 589 (Tex. App.-El Paso 2020) (considering preemption raised in plea to the jurisdiction). We begin with standing.

B. Does SWAPA have associational standing?

SWAPA argues that it has standing to assert its members' claims...

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