No. 93-1286
Argued: November 1, 1994Decided: January 18, 1995
- While the Illinois class-action litigation was sub judice, this Court decided Morales v. Trans World Airlines, Inc., 504 U.S. ___. Morales defined 1305 (a)(1)’s “relating to” language to mean “having a connection with or reference to airline `rates, routes, or services,'” id., at ___, and held that National Association of Attorneys General (NAAG) guidelines on airline fare advertising were preempted under that definition. The Illinois Supreme Court, post-Morales, ruled that plaintiffs’ monetary claims survived for state-court adjudication. Those claims related only “tangential[ly]” or “tenuous[ly]” to “rates, routes, or services,” the Illinois court reasoned, because frequent flyer programs are “peripheral,” not “essential,” to an airline’s operation.
Held:
The ADA’s preemption prescription bars state-imposed regulation of air carriers, but allows room for court enforcement of contract Page II terms set by the parties themselves. Pp. 6-15.
- (a) Morales does not countenance the Illinois Supreme Court’s separation of “essential” operations from unessential programs. Plaintiffs’ complaints, accordingly, state claims “relating to” air carrier “rates” (i.e., American’s charges, in the form of mileage credits, for tickets and class-of-service upgrades) and “services” (i.e., access to flights and upgrades unlimited by retrospectively applied capacity controls and blackout dates). Pp. 6.
- (b) The full text of the ADA’s preemption clause, and the congressional purpose to leave largely to the airlines themselves, and not at all to States, the selection and design of marketing mechanisms appropriate to the furnishing of air transportation services, impel the conclusion that 1305 (a)(1) preempts plaintiffs’ Consumer Fraud Act claims. The Illinois Act is prescriptive, controlling the primary conduct of those falling within its governance; the Act, indeed, is paradigmatic of the state consumer protection laws that underpin the NAAG guidelines. Those guidelines highlight the potential for intrusive regulation of airline business practices inherent in state consumer protection legislation. The guidelines illustrate that the Illinois Act does not simply give effect to bargains offered by the airlines and accepted by customers, but serves as a means to guide and police airline marketing practices. Pp. 6-8.
- (c) The ADA, however, does not bar court adjudication of routine breach of contract claims. The preemption clause leaves room for suits alleging no violation of state-imposed obligations, but seeking recovery solely for the airline’s breach of its own, self-imposed undertakings. As persuasively argued by the United States, terms and conditions airlines offer and passengers accept are privately ordered obligations and thus do not fit within the compass of state enactments and directives targeted by 1305 (a)(1). A remedy confined to a contract’s terms simply holds parties to their agreements – in this instance, to business judgments an airline made public about its rates and services. Court enforcement of private agreements advances the market efficiency that the ADA was designed to promote, and comports with provisions of the Federal Aviation Act of 1958 (FAA) and related Department of Transportation (DOT) regulations that presuppose the vitality of contracts governing air carrier transportation. Such enforcement is responsive to the reality that the DOT lacks the apparatus and resources required to superintend a contract dispute resolution regime. Court adjudication of routine breach of contract claims, furthermore, accords due recognition to Congress’ retention of the FAA’s saving clause, which preserves “the remedies now existing at common law or by statute.” Nor can it be maintained that plaintiffs’ breach of Page III contract claims are identical to, and therefore should be preempted to the same extent as, their Consumer Fraud Act claims. The basis for a contract action is the parties’ agreement; to succeed under the state Act, one need not show an agreement, but must show an unfair or deceptive practice. Pp. 8-13.
- (d) American’s argument that plaintiffs’ claims must fail because they depend on state policies independent of the parties’ intent assumes the answer to the very contract construction issue on which plaintiffs’ claims turn: Did American, by contract, reserve the right to change the value of already accumulated mileage credits, or only to change the rules for credits earned from and after the date of the change? That pivotal question of contract interpretation has not yet had a full airing and remains open for adjudication on remand. Pp. 14.
157 Ill. 2d 466, 626 N.E.2d 205, affirmed in part, reversed in part, and remanded.
GINSBURG, J., delivered the opinion of the Court, in which REHNQUIST, C.J., and KENNEDY, SOUTER, and BREYER, JJ., joined, and in which STEVENS, J., joined as to Parts I (except for the last paragraph) and II-B. STEVENS, J., filed an opinion concurring in part and dissenting in part. O’CONNOR, J., filed an opinion concurring in the judgment in part and dissenting in part, in which THOMAS, J., joined except for Part I-B. SCALIA, J., took no part in the consideration or decision of the case. [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 1]
BRUCE J. ENNIS JR., Washington, D.C. (JEROLD S. SOLOVY, MARGUERITE M. TOMPKINS, DONALD B. VERRILLI JR., JENNER & BLOCK, RICHARD A. ROTHMAN, BONNIE GARONE, WEIL, GOTSHAL & MANGES, and MICHAEL J. RIDER, on the briefs) for petitioner; CORNELIA T.L. PILLARD, Assistant to the Solicitor General (DREW S. DAYS, Sol. Gen., FRANK W. HUNGER, Asst. Atty. Gen., EDWIN S. KNEEDLER, Dpty. Atty. Gen., ROBERT V. ZENER and JONATHAN R. SIEGEL, Dept. of Justice attys., STEPHEN H. KAPLAN, Department of Transportation Gen. Counsel, PAUL M. GEIER, Asst. Gen. Counsel for Litigation, and SAMUEL PODBERESKY, Asst. Gen. Counsel for Aviation Enforcement and Proceedings, on the briefs) for U.S. as amicus curiae; GILBERT W. GORDON, Chicago, Ill. (ROBERT MARKS, WILLIAM V. SARACCO, MARKS, MARKS and KAPLAN LTD., MICHAEL J. FREED, MICHAEL B. HYMAN, EDITH F. CANTER, MUCH SHELIST FREED DENENBERG & AMENT P.C., NICHOLAS E. CHIMICLES, IRA NEIL RICHARDS, STEVEN A. SCHWARTZ, CHIMICLES, JACOBSEN & TIKELLIS, MARVIN MILLER, AND MILLER FAUCHER CHERTOW CAFFERTY and WEXLER, on the briefs) for respondents.
JUSTICE GINSBURG delivered the opinion of the Court.
The Airline Deregulation Act of 1978 (ADA) prohibits States from “enact[ing] or enforc[ing] any law . . . relating to [air carrier] rates, routes, or services.” 49 U.S.C. App. 1305 (a)(1). This case concerns the scope of that preemptive provision, specifically, its application to a state-court suit, brought by participants in an airline’s frequent flyer program, challenging the airline’s retroactive changes in terms and conditions of the program. We hold that the ADA’s preemption prescription bars state-imposed regulation of air carriers, but allows room for court enforcement of contract terms set by the parties themselves.
I
A
Until 1978, the Federal Aviation Act of 1958 (FAA), 72 Stat. 731, as amended, 49 U.S.C. App. 1301 et seq. (1988 ed. and Supp. V), empowered the Civil Aeronautics Board (CAB) to regulate the interstate airline industry. Although the FAA, pre-1978, authorized the Board both to regulate fares and to take administrative action against deceptive trade practices, the federal legislation originally contained no clause preempting state regulation. [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 2] And from the start, the FAA has contained a “saving clause,” 1106, 49 U.S.C. App. 1506, stating: “Nothing . . . in this chapter shall in any way abridge or alter the remedies now existing at common law or by statute, but the provisions of this chapter are in addition to such remedies.”
In 1978, Congress enacted the Airline Deregulation Act (ADA), 92 Stat. 1705, which largely deregulated domestic air transport. “To ensure that the States would not undo federal deregulation with regulation of their own,” Morales v. Trans World Airlines, Inc., 504 U.S. ___ (1992) (slip op., at 2), the ADA included a preemption clause which read in relevant part:
-
- “[N]o State . . . shall enact or enforce any law, rule, regulation, standard, or other provision having the force and effect of law relating to rates, routes, or services of any air carrier . . . .” 49 U.S.C. App. 1305 (a)(1).
This case is our second encounter with the ADA’s preemption clause. In 1992, in Morales, we confronted detailed Travel Industry Enforcement Guidelines, composed by the National Association of Attorneys General (NAAG). The NAAG guidelines purported to govern, inter alia, the content and format of airline fare advertising. See Morales, 504 U.S., at ___ – ___ (slip op., at 15-42) (appendix to Court’s opinion setting out NAAG guidelines on air travel industry advertising and marketing practices). Several states had endeavored to enforce [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 3] the NAAG guidelines, under the states’ general consumer protection laws, to stop allegedly deceptive airline advertisements. The states’ initiative, we determined, “`relat[ed] to [airline] rates, routes, or services,'” id., at ___ (slip op., at 8) (quoting 49 U.S.C. App. 1305 (a)(1)); consequently, we held, the fare advertising provisions of the NAAG guidelines were preempted by the ADA. Id., at ___ (slip op., at 14).
For aid in construing the ADA words “relating to rates, routes, or services of any air carrier,” the Court in Morales referred to the Employee Retirement Income Security Act of 1974 (ERISA), which provides for preemption of state laws “insofar as they . . . relate to any employee benefit plan.” 29 U.S.C. 1144(a). Under the ERISA, we had ruled, a state law “relates to” an employee benefit plan “if it has a connection with or reference to such a plan.” Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 97 (1983). Morales analogously defined the “relating to” language in the ADA preemption clause as “having a connection with or reference to airline `rates, routes, or services.'” Morales, 504 U.S., at ___ (slip op., at 7).
The Morales opinion presented much more, however, in accounting for the ADA’s preemption of the state regulation in question. The opinion pointed out that the concerned federal agencies – the Department of Transportation (DOT) 2 and the Federal Trade Commission (FTC) – objected to the NAAG fare advertising guidelines as inconsistent with the ADA’s deregulatory purpose; both agencies, Morales observed, regarded the guidelines as state regulatory measures preempted by the ADA. See Morales, 504 U.S., at ___ (slip op., at 2) (DOT and [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 4] FTC); id., at ___ (slip op., at 10) (DOT); id., at ___ (slip op., at 13) (FTC). Morales emphasized that the challenged guidelines set “binding requirements as to how airline tickets may be marketed,” and “imposed [obligations that] would have a significant impact upon . . . the fares [airlines] charge.” Id., at ___, ___ (slip op., at 11, 13). The opinion further noted that the airlines would not have “carte blanche to lie and deceive consumers,” for “the DOT retains the power to prohibit advertisements which in its opinion do not further competitive pricing.” Id., at ___ (slip op., at 14). Morales also left room for state actions “too tenuous, remote, or peripheral . . . to have pre-emptive effect.” Ibid. (internal quotation marks omitted).
B
The litigation now before us, two consolidated state-court class actions brought in Illinois, was sub judice when we decided Morales. Plaintiffs in both actions (respondents here) are participants in American Airlines’ frequent flyer program, AAdvantage. AAdvantage enrollees earn mileage credits when they fly on American. They can exchange those credits for flight tickets or class-of-service upgrades. Plaintiffs complained that AAdvantage program modifications, instituted by American in 1988, devalued credits AAdvantage members had already earned. Plaintiffs featured American’s imposition of capacity controls (limits on seats available to passengers obtaining tickets with AAdvantage credits) and blackout dates (restrictions on dates credits could be used). Conceding that American had reserved the right to change AAdvantage terms and conditions, plaintiffs challenged only the retroactive application of modifications, i. e., cutbacks on the utility of credits previously accumulated. These cutbacks, plaintiffs maintained, violated the Illinois Consumer Fraud and Deceptive Business Practices Act (Consumer Fraud Act), 815 Ill. [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 5] Comp. Stat. 505 (1992) (formerly codified at Ill. Rev. Stat., ch. 121 1/2, § 261 et seq. (1991)), and constituted a breach of contract. Plaintiffs currently seek only monetary relief. 3
In March 1992, several weeks before our decision in Morales, the Illinois Supreme Court rejected plaintiffs’ prayer for an injunction. Such a decree, the Illinois court reasoned, would involve regulation of an airline’s current rendition of services, a matter preempted by the ADA. That court, however, allowed the breach of contract and Consumer Fraud Act monetary relief claims to survive. The ADA’s preemption clause, the Illinois court said, ruled out “only those State laws and regulations that specifically relate to and have more than a tangential connection with an airline’s rates, routes or services.” American Airlines, Inc. v. Wolens, 147 Ill. 2d 367, 373, 589 N.E.2d 533, 536 (1992). After our decision in Morales, American petitioned for certiorari. The airline charged that the Illinois court, in a decision out of sync with Morales, had narrowly construed the ADA’s broadly preemptive 1305 (a)(1). We granted the petition, vacated the judgment of the Supreme Court of Illinois, and remanded for further consideration in light of Morales. American Airlines, Inc. v. Wolens, 506 U.S. ___ (1992).
On remand, the Illinois Supreme Court, with one dissent, adhered to its prior judgment. Describing frequent flyer programs as not “essential,” 157 Ill. 2d 466, 472, 626 N.E.2d 205, 208 (1993), but merely “peripheral to the operation of an airline,” ibid., the [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 6] Illinois court typed plaintiffs’ state law claims for money damages as “relat[ed] to American’s rates, routes, and services” only “tangential[ly]” or “tenuous[ly].” Ibid.
We granted American’s second petition for certiorari 511 U.S. ___ (1994), and we now reverse the Illinois Supreme Court’s judgment to the extent that it allowed survival of plaintiffs’ Consumer Fraud Act claims; we affirm that judgment, however, to the extent that it permits plaintiffs’ breach of contract action to proceed. In both respects, we adopt the position of the DOT, as advanced in this Court by the United States.
II
We need not dwell on the question whether plaintiffs’ complaints state claims “relating to [air carrier] rates, routes, or services.” Morales, we are satisfied, does not countenance the Illinois Supreme Court’s separation of matters “essential” from matters unessential to airline operations. Plaintiffs’ claims relate to “rates,” i. e., American’s charges in the form of mileage credits for free tickets and upgrades, and to “services,” i. e., access to flights and class-of-service upgrades unlimited by retrospectively applied capacity controls and blackout dates. But the ADA’s preemption clause contains other words in need of interpretation, specifically, the words “enact or enforce any law” in the instruction: “[N]o state . . . shall enact or enforce any law . . . relating to [air carrier] rates, routes, or services.” 49 U.S.C. App. 1305 (a)(1). Taking into account all the words Congress placed in 1305 (a)(1), we first consider whether plaintiffs’ claims under the Illinois Consumer Fraud Act are preempted, and then turn to plaintiffs’ breach of contract claims.
A
The Illinois Consumer Fraud Act declares unlawful [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 7] “[u]nfair methods of competition and unfair or deceptive acts or practices, including but not limited to the use or employment of any deception, fraud, false pretense, false promise, misrepresentation or the concealment, suppression or omission of any material fact, with intent that others rely upon the concealment, suppression or omission of such material fact, or the use or employment of any practice described in Section 2 of the `Uniform Deceptive Trade Practices Act’ . . . in the conduct of any trade or commerce . . . whether any person has in fact been misled, deceived or damaged thereby.” 815 Ill. Comp. Stat. 505/2 (1992) (formerly codified at Ill. Rev. Stat., ch. 121 1/2, § 262 (1991)).
The Act is prescriptive; it controls the primary conduct of those falling within its governance. This Illinois law, in fact, is paradigmatic of the consumer protection legislation underpinning the NAAG guidelines. The NAAG Task Force on the Air Travel Industry, on which the Attorneys General of California, Illinois, Texas, and Washington served, see Morales, 504 U.S., at ___ (slip op., at 16), reported that the guidelines created no
- “new laws or regulations regarding the advertising practices or other business practices of the airline industry. They merely explain in detail how existing state laws apply to air fare advertising and frequent flyer programs.” Ibid.
The NAAG guidelines highlight the potential for intrusive regulation of airline business practices inherent in state consumer protection legislation typified by the Illinois Consumer Fraud Act. For example, the guidelines enforcing the legislation instruct airlines on language appropriate to reserve rights to alter frequent flyer programs, and they include transition rules for the [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 8] fair institution of capacity controls. See Brief for United States as Amicus Curiae 13-14, n. 7.
As the NAAG guidelines illustrate, the Illinois Consumer Fraud Act serves as a means to guide and police the marketing practices of the airlines; the Act does not simply give effect to bargains offered by the airlines and accepted by airline customers. In light of the full text of the preemption clause, and of the ADA’s purpose to leave largely to the airlines themselves, and not at all to States, the selection and design of marketing mechanisms appropriate to the furnishing of air transportation services, 4 we conclude that 1305 (a)(1) preempts plaintiffs’ claims under the Illinois Consumer Fraud Act.
B
American maintains, and we agree, that “Congress could hardly have intended to allow the States to hobble [competition for airline passengers] through the application of restrictive state laws.” Brief for Petitioner 27. We do not read the ADA’s preemption clause, however, to shelter airlines from suits alleging no violation of state-imposed obligations, but seeking recovery solely for the airline’s alleged breach of its own, self-imposed undertakings. As persuasively argued by the United States, terms and conditions airlines offer and passengers accept are privately ordered obligations “and thus do not amount to a State’s `enact[ment] or enforce[ment] [of] any law, rule, regulation, standard, or other provision [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 9] having the force and effect of law’ within the meaning of [] 1305 (a)(1).” 5 Brief for United States as Amicus Curiae 9. Cf. Cipollone v. Liggett Group, Inc., 505 U.S. ___, ___ (1992) (slip op., at 20) (plurality opinion) (“[A] common law remedy for a contractual commitment voluntarily undertaken should not be regarded as a `requirement imposed under state law’ within the meaning of [Federal Cigarette Labeling and Advertising Act] 5 (b).”). A remedy confined to a contract’s terms simply holds parties to their agreements – in this instance, to business judgments an airline made public about its rates and services. 6 [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 10]
The ADA, as we recognized in Morales, 504 U.S., at ___ (slip op., at 2), was designed to promote “maximum reliance on competitive market forces.” 49 U.S.C. App. 1302 (a)(4). Market efficiency requires effective means to enforce private agreements. See Farber, Contract Law and Modern Economic Theory, 78 Nw. U. L. Rev. 303, 315 (1983) (remedy for breach of contract “is necessary in order to ensure economic efficiency”); R. Posner, Economic Analysis of Law 90-91 (4th ed. 1992) (legal enforcement of contracts is more efficient than a purely voluntary system). As stated by the United States: “The stability and efficiency of the market depend fundamentally on the enforcement of agreements freely made, based on needs perceived by the contracting parties at the time.” Brief for United States as Amicus Curiae 23. That reality is key to sensible construction of the ADA.
The FAA’s text, we note, presupposes the vitality of contracts governing transportation by air carriers. Section 411 (b), 49 U.S.C. App. 1381 (b), thus authorizes airlines to “incorporate by reference in any ticket or other written instrument any of the terms of the contract of carriage” to the extent authorized by the DOT. And the DOT’s regulations contemplate that, upon the January 1, 1983, termination of domestic tariffs, “ticket contracts” ordinarily would be enforceable under “the contract law of the states.” 47 Fed. Reg. 52129 (1982). Correspondingly, the DOT requires carriers to give passengers written notice of the time period within which they may “bring an action against the carrier for its acts.” 14 CFR 253.5 (b)(2) (1994). [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 11]
American does not suggest that its contracts lack legal force. American sees the DOT, however, as the exclusively competent monitor of the airline’s undertakings. American points to the Department’s authority to require any airline, in conjunction with its certification, to file a performance bond conditioned on the airline’s “making appropriate compensation . . ., as prescribed by the [Department], for failure . . . to perform air transportation services in accordance with agreements therefor.” FAA 401 (q)(2), 49 U.S.C. App. 1371 (q)(2). 7 But neither the DOT nor its predecessor, the CAB, has ever construed or applied this provision to displace courts as adjudicators in air carrier contract disputes. Instead, these agencies have read the provision to charge them with a less taxing task: In passing on air carrier fitness under FAA 401 (d), 49 U.S.C. App. 1371 (d)(1), the DOT and the CAB have used their performance bond authority to ensure that, when a carrier’s financial fitness is marginal, funds will be available to compensate customers if the carrier goes under before providing already-paid-for services. See, e. g., U.S. Bahamas Service Investigation, CAB Order 79-11-116, p. 3, 84 CAB Reports 73, 75 (1979) (“We . . . find that Southeast [Airlines] is fit to provide scheduled foreign air transportation. However, because of Southeast’s current financial [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 12] condition its operations present an unacceptable risk of financial loss to consumers. Therefore, we shall require the carrier . . . to procure and maintain a bond for the protection of passengers who have paid for transportation not yet performed.”).
The United States maintains that the DOT has neither the authority nor the apparatus required to superintend a contract dispute resolution regime. See Brief for United States as Amicus Curiae 22. Prior to airline deregulation, the CAB set rates, routes, and services through a cumbersome administrative process of applications and approvals. 72 Stat. 731. When Congress dismantled that regime, the United States emphasizes, the lawmakers indicated no intention to establish, simultaneously, a new administrative process for DOT adjudication of private contract disputes. See Brief for United States as Amicus Curiae 22. We agree.
Nor is it plausible that Congress meant to channel into federal courts the business of resolving, pursuant to judicially fashioned federal common law, the range of contract claims relating to airline rates, routes, or services. The ADA contains no hint of such a role for the federal courts. In this regard, the ADA contrasts markedly with the ERISA, which does channel civil actions into federal courts, see ERISA 502 (a), (e), 29 U.S.C. 1132 (a), (e), under a comprehensive scheme, detailed in the legislation, designed to promote “prompt and fair claims settlement.” Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 54 (1987); see Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 143 -145 (1990) (finding ERISA’s comprehensive civil enforcement scheme a “special feature” supporting preemption of common-law wrongful discharge claims).
The conclusion that the ADA permits state-law-based court adjudication of routine breach of contract claims also makes sense of Congress’ retention of the FAA’s saving clause, 1106, 49 U.S.C. App. 1506 (preserving [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 13] “the remedies now existing at common law or by statute”). The ADA’s preemption clause, 1305 (a)(1), read together with the FAA’s saving clause, stops States from imposing their own substantive standards with respect to rates, routes, or services, but not from affording relief to a party who claims and proves that an airline dishonored a term the airline itself stipulated. This distinction between what the State dictates and what the airline itself undertakes confines courts, in breach of contract actions, to the parties’ bargain, with no enlargement or enhancement based on state laws or policies external to the agreement. 8
American suggests that plaintiffs’ breach of contract and Illinois Consumer Fraud Act claims differ only in their labels, so that if Fraud Act claims are preempted, contract claims must be preempted as well. See Reply Brief 6. But a breach of contract, without more, “does not amount to a cause of action cognizable under the [Consumer Fraud] Act and the Act should not apply to simple breach of contract claims.” Golembiewski v. Hallberg Ins. Agency, Inc., 262 Ill. App. 3d 1082, ___, 635 N.E.2d 452, 460 (1st Dist. 1994). The basis for a contract action is the parties’ agreement; to succeed under the consumer protection law, one must show not necessarily an agreement, but in all cases, an unfair or deceptive practice. [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 14]
III
American ultimately argues that even under the position on preemption advanced by the United States – the one we adopt – plaintiffs’ claims must fail because they “inescapably depend on state policies that are independent of the intent of the parties.” Reply Brief 3. “The state court cannot reach the merits,” American contends, “unless it first invalidates or limits [American’s] express reservation of the right to change AAdvantage Program rules contained in AAdvantage contracts.” Ibid.
American’s argument is unpersuasive, for it assumes the answer to the very contract construction issue on which plaintiffs’ claims turn: Did American, by contract, reserve the right to change the value of already accumulated mileage credits, or only to change the rules governing credits earned from and after the date of the change? See Brief for Respondents 5 (plaintiffs recognize that American “reserved the right to restrict, suspend, or otherwise alter aspects of the Program prospectively,” but maintain that American “never reserved the right to retroactively diminish the value of the credits previously earned by members”). That question of contract interpretation has not yet had a full airing, and we intimate no view on its resolution.
Responding to our colleagues’ diverse opinions dissenting in part, we add a final note. This case presents two issues that run all through the law. First, who decides (here, courts or the DOT, the latter lacking contract dispute resolution resources for the task)? On this question, all agree to this extent: None of the opinions in this case would foist on the DOT work Congress has neither instructed nor funded the Department to do. Second, where is it proper to draw the line (here, between what the ADA preempts, and what it leaves to private ordering, backed by judicial enforcement)? JUSTICE STEVENS reads our Morales decision to demand [ AMERICAN AIRLINES, INC. v. WOLENS, ___ U.S. ___ (1995) , 15] only minimal preemption; in contrast, JUSTICE O’CONNOR reads the same case to mandate total preemption. 9 The middle course we adopt seems to us best calculated to carry out the congressional design; it also bears the approval of the statute’s experienced administrator, the DOT. And while we adhere to our holding in Morales, we do not overlook that in our system of adjudication, principles seldom can be settled “on the basis of one or two cases, but require a closer working out.” Pound, Survey of the Conference Problems, 14 U. Cin. L. Rev. 324, 339 (1940) (Conference on the Status of the Rule of Judicial Precedent).
