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Brooklyn rabbi’s case to be ruled on by U.S. Supreme Court

December 4, 2013 By Charisma L. Miller, Esq. Brooklyn Daily Eagle
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Ousted from an airline’s frequent flyer program for allegedly making too many complaints, a Brooklyn-born rabbi will have his case decided by the United States Supreme Court.

Rabbi S. Binyomin Ginsberg, now living in Minneapolis, was a member of Northwest Airline’s Platinum Elite member frequent flyer program. Northwest — purchased by Delta in 2010 — revoked Ginsberg’s membership on the supposed grounds that Ginsberg abused his membership benefits.

According to court documents, between December 2007 and July 2008, Ginsberg filed 24 complaints with Northwest for compensation “over and above [Northwest’s] guidelines.” Ginsberg filed suit in 2009, claiming that Northwest violated its WorldPerks agreement when it revoked his membership without cause.

The WorldPerks agreement contained a provision allowing Northwest to cancel a member’s account for “harassing behavior,” with the determination of what constitutes harassing behavior to be left to Northwest’s sole discretion.

A lower district court dismissed Ginsberg’s suit on the basis of a federal law that, the court ruled, preempted Ginsberg’s claim. The Airline Deregulation Act of 1978 (“ADA”) mandates that a state “may not enact or enforce a law, regulation or other provision having the force and effect of law related to a price, route, or service of an air carrier.”  The lower court ruled that the ADA’s preemption provision forced it to dismiss Ginsberg’s claims.

Ginsberg in turn appealed the decision on the sole ground that Northwest’s actions breached the implied covenant of good faith and fair dealing contained within the WorldPerks agreement. The U.S. Court of Appeals for the Ninth Circuit ruled in his favor and caused Northwest to appeal to the US Supreme Court.

Arguing for Northwest, Paul Clement asserted during oral arguments Tuesday that even in the implied covenant of good faith and fair dealing, the ADA’s preemption provision applies. For Ginsberg’s attorney, Adina Rosenbaum of Public Citizen Litigation Group, the issue was whether or not the implied covenant was  “reasonable expectation of the parties.”  

Rosenbaum argued that the implied covenant is a tool for interpreting reasonable expectations and thus not subject to the ADA’s preemption provision. “The covenant is not being used to override any terms in the contract,” Rosenbaum said.

Some justices questioned whether or not the WorldPerks agreement was illusory — an agreement that cannot be enforced because it is too vague. “[I]f the airline has an unreviewable right to terminate this agreement for any reason or for no reason, if that is so, then it’s an illusory contract,” Justice Ruth Ginsberg noted.  

Clement countered that leaving the determination of harassing behavior in the sole discretion of Northwest does not make the agreement illusory. “Why do they say sole discretion and not say sole discretion unless it violates reasonable norms of community standards and decency?

“Well, the reason is you can’t run a[n] …  international airline, if every one of your judgments about taking an unruly passenger off or taking out an abusive customer is going to be second-guessed by a jury applying reasonable standards of ordinary decency and morality,” Clement told the justices.

Ginsberg is seeking damages in excess of $5 million, as well as injunctive relief requiring Northwest to restore WorldPerks status and prohibiting Northwest from future revocations of members’ WorldPerks status “without valid cause.”

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