People ex rel. Harris v. Delta Air Lines, Inc.

1 Because the Legislature has not given Business and Professions Code section 17200 et seq. an official name, our Supreme Court refers to these sections as the “unfair' competition law.” (Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20 Cal.4th 163 , 169, fn. 2 [ 83 Cal.Rptr.2d 548 , 973 P.2d 527 ].) In this opinion, we refer to these statutory sections in the same manner.

2 We treat the superior court’s May 9, 2013, order sustaining the demurrer without leave to amend and dismissing the complaint with prejudice as a final judgment of dismissal from which an appeal lies. (See Code Civ. Proc., § 581d; Daar v. Yellow Cab Co. (1967) 67 Cal.2d 695 , 699 [ 63 Cal.Rptr. 724 , 433 P.2d 732 ] [“ ‘an order of dismissal is to be treated as a judgment for the purposes of taking an appeal when it finally disposes of the particular action and prevents further proceedings as effectually as would any formal judgment’ ”].)

3 Because the State’s action was resolved by demurrer, we set forth the facts as alleged in the complaint, the operative pleading. (Shvarts v. Budget Group, Inc. (2000) 81 Cal.App.4th 1153 , 1156 [ 97 Cal.Rptr.2d 722 ].)

4 In opposing the demurrer, the State informed the superior court that since the filing of its complaint. Delta’s Fly Delta mobile application allows customers to price and purchase tickets.

5 In its complaint, the State alleges that the PII collected through the Fly Delta mobile application includes (a) geo-location data (GPS); (b) photographs; (c) user’s full name; (d) street addresses (residential and billing); (e) telephone numbers (including cell, fax, and pager); (f) e-mail addresses; (g) Delta Sky Miles account number and flight information; (h) credit/debit card numbers and expiration dates; (i) date of birth; (j) gender; (k) traveler number; (1) travel-related information, such as travel company, emergency contacts, seating preferences, medical needs and dietary requests; (m) passport number, nationality, country of residence; (n) corporate contract, employer or affiliation. In its brief on appeal, the State further asserts that at the time of the filing of its complaint. Delta’s Fly Delta mobile application might have been collecting other PII, which was not disclosed in any privacy policy, including the collection of a universal device identification, which “uniquely and statically identifies the mobile device and user.”

6 According to the State, the Delta.com Web site contained a privacy policy describing some of the PII collected by the Web site, but the Web site’s privacy policy did not mention the Fly Delta mobile application or disclose certain PII collected only by the Fly Delta mobile application, such as GPS or photographs.

7 In addition to the briefs filed by the parties, we have considered an amicus curiae brief, in support of Delta’s position, filed by Air Transport Association of America, Inc., doing business as Airlines For America. Also, Delta requests that we take judicial notice of certain documents, which were not submitted in the superior court: (1) United States Senate Report No. 95-631, Second Session (1978) regarding the ADA; (2) United States House of Representatives Report No. 95-1779, Second Session (1978) regarding the ADA; (3) United States House of Representatives Report No. 98-793 (1984) regarding the ADA; (4) California Senate Committee of Judiciary, Analysis of Assembly Bill No. 68 (2003-2004 Reg. Sess.) analyzing the OPPA; (5) Statement of Interest of United States, filed in National Federation of the Blind v. United Airlines, Inc. (N.D.Cal., Apr. 25, 2011, C 10-04816 WHA) 2011 U.S.Dist. Lexis 44366; (6) brief for United States as amicus curiae supporting affirmance, filed in National Federation of the Blind v. United Airlines. Inc. (9th Cir. 2016) 813 F.3d 718 (National Fed. of the Blind): (7) brief for United States as amicus curiae supporting reversal, filed in Northwest, Inc. v. Ginsberg (2014) 572 U.S. _ [ 188 L.Ed.2d 538 , 134 S.Ct. 1422 ]; (8) Third-Party Enforcement Complaint of the Electronic Privacy Information Center Against Northwest Airlines, Inc. (Department of Transportation, Sept. 10, 2004, No. OST-2004-6939-10) [ 2004 WL 2049588 ]); (9) Assistant General Counsel for “Aviation Enforcement and Proceeding” of the United States Department of Commerce Samuel Podberesky, letter to John Mogg at the European Commission in Belgium, explaining the role of the Department of Transportation in protecting the privacy of consumers with respect to information provided by them to airlines (July 14, 2000). We deferred consideration of Delta’s request for judicial notice to the decision on appeal, and we now deny the request for judicial notice. “Generally, ‘ “when reviewing the correctness of a [superior] court’s judgment, an appellate court will consider only matters which were part of the record at the time the judgment was entered.” [Citation.]’ [Citations.]” (California School Bds. Assn. v. State of California (2011) 192 Cal.App.4th 770 , 803 [ 121 Cal.Rptr.3d 696 ].) Delta has “not cited any exceptional circumstances that would justify a deviation from this rule in this appeal.” (Ibid.) In all events, as to the legislative reports related to the enactment of the ADA and the OPPA, a request for judicial notice of those materials is not necessary. “Citation to the material is sufficient.” (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26 , 46, fn. 9 [ 77 Cal.Rptr.2d 709 , 960 P.2d 513 ]; see Wittenburg v. Beachwalk Homeowners *894 Assn. (2013) 217 Cal.App.4th 654 , 665, fn. 4 [ 158 Cal.Rptr.3d 508 ] [“[a] motion for judicial notice of published legislative history, such as the Senate analysis here, is unnecessary”].) Consideration of the other described material is not necessary to the resolution of this appeal. (See Jordache Enterprises. Inc. v. Brobeck. Phleger & Harrison (1998) 18 Cal.4th 739 , 748, fn. 6 [ 76 Cal.Rptr.2d 749 , 958 P.2d 1062 ] [court declined to take judicial notice of materials that were not “necessary . . .”].)

8 Consequently, we do not separately address the superior court’s reasons for sustaining the demurrer without leave to amend. (McKell v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457 , 1470 [ 49 Cal.Rptr.3d 227 ] [to the extent the superior court’s ruling may have been in error, “[w]e need not make the determination as to whether there was error” because our review is de novo and we “make our own determination as to whether plaintifff] [has] pleaded facts sufficient to constitute a cause of action, under any theory”].)

9 The clause formerly read in relevant part: “No 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 ah earner (49 U.S.C. App. § 1305(a)(1).) When Congress reenacted title 49 of the United States Code in 1994, it revised the clause to read as it is stated in the text of this opinion. “Congress intended the revision to make no substantive change. [(Pub.L. No. 103-272, § 1(a), 108 Stats. 745.)]"’ (American Airlines. Inc. v. Wolens (1995) 513 U.S. 219 , 223, fn. 1 [ 130 L.Ed.2d 715 , 115 S.Ct. 817 ] (Wolens).)

10 In a footnote, the high court stated: “We note again, however, that the DOT retains authority to investigate unfair and deceptive practices and unfair' methods of competition by airlines, and may order an airline to cease and desist from such practices or methods of competition. [Citations.]” (Wolens. supra. 513 U.S. at p. 228, fn. 4.)

11 Congress has also specifically authorized the Department of Tranportation (DOT) to investigate consumer complaints about deceptive or misleading advertising. (See FAA Modernization and Reform Act of 2012, § 408(7), 126 Stat. 87 .)

12 As noted, the OPPA does not explicitly provide for a private action or public prosecution for any violation of its provisions. In the absence of any arguments on the matter, we assume for the purposes of this appeal that a violation of the OPPA may be enforced through a UCL action.

13 In so concluding, we need not and do not address the Attorney General’s assertion that the Fly Delta mobile application is not a “service” within the meaning of the ADA. We recognize that the federal circuit courts of appeals have read the word “services” in the ADA preemption provision in various ways. (Compare Hodges v. Delta Airlines. Inc. (5th Cir. 1995) 44 F.3d 334 , 336 [en banc] [defining “service” more broadly in terms of the “ ‘[contractual] features of ah transportation,’ ” including “ ‘ticketing, boarding procedures, provision of food and drink, and *902 baggage handling’ ”], with Charas v. Trans World Airlines. Inc. (9th Cir. 1998) 160 F.3d 1259 , 1261 [en banc] [defining “service” more narrowly to “the prices, schedules, origins and destinations of the point-to-point transportation of passengers, cargo, or mail,” but not to “include an airline’s provision of in-flight beverages, personal assistance to passengers, the handling of luggage, and similar amenities”]; National Fed. of the Blind, supra. 813 F.3d at pp. 725-729 [accord].) However, “[w]e are . . . not bound by the decisions of federal courts other than the United States Supreme Court (People v. Gray (2005) 37 Cal.4th 168 , 226 [ 33 Cal.Rptr.3d 451 , 118 P.3d 496 ]), although their interpretation of federal law may be persuasive (Spellman v. Securities. Annuities & Ins. Services, Inc. (1992) 8 Cal.App.4th 452 , 459 [ 10 Cal.Rptr.2d 427 ]).” (Teva Pharmaceuticals USA. Inc. v. Superior Court (2013) 217 Cal.App.4th 96 , 109, fn. 2 [ 158 Cal.Rptr.3d 150 ].) In all events, the issue before us is not whether the Fly Delta application is a “service,” but whether it “relates to” Delta’s services. As Morales explains, the Attorney General’s assertion “simply reads the words ‘relating to’ out of the statute.” (Morales, supra. 504 U.S. at p. 385.)

14 As the high court has noted on each occasion that it has addressed the reach of the ADA preemption provision, “the DOT retains authority to investigate unfair' and deceptive practices and unfair' methods of competition by airlines, and may order an airline to cease and desist from such practices or methods of competition. [Citations.]” (Wolens, supra. 513 U.S. at p. 228, fn. 4; see Morales, supra. 504 U.S. at p. 379; Ginsberg, supra, at p. _ [134 S.Ct. at p. 1433].) “Pursuant to this exclusive authority, the DOT created an Office of Consumer Protection, a unit of the Office of Aviation Enforcement and Proceedings, responsible [for] compliance with the DOT’S consumer protection requirements also in charge of detecting and correcting any practices by carriers that are inimical to the consumer interest. This office receives informal complaints from members of the public regarding aviation consumer issues, such as deceptive advertisement practices.” (De Jesus, supra. 532 F.Supp.2d at p. 354.) And, DOT has apparently taken action regarding air carriers’ collection of PII and privacy policies for the sharing and storage of PII. (See, e.g., 78 Fed.Reg. 26101-03 (May 3, 2013 [Notice of 4th Meeting of DOT Advisory Committee for Aviation Consumer Protection scheduled for May 21, 2013, to receive comments regarding, among other things, what privacy policies are in place concerning PII collected in connection with the purchase of air' travel, whether information is used consistent with those policies, and what security measures are in place to protect against unauthorized access]; see also order to show cause issued by the DOT, served May 21, 2014, at pp. 2, 13 [DOT seeks comments on its proposed approval of an agreement adopting a new resolution No. 787 (enhanced airline distribution), which establishes a process for developing a technical standard for data exchange in the air' transportation marketplace using extensible markup language (XMF), “the modern language of the internet”; DOT’S approval was conditioned on the airlines continuing to follow their' privacy policies for the sharing and storage of personal information as the “[f]ailure by an entity to follow its established privacy policy for the sharing and storing of personal information is a violation of 49 U.S.C. § 41712 , the statute prohibiting unfair and deceptive practices”].) In all events, the fact that DOT has not issued any regulations concerning the form and placement of privacy policies related to an airline’s mobile application does not allow the State to exercise its reserved constitutional and police powers to do so, as the Attorney General suggests.

15 The Attorney General’s reliance on the United States Supreme Court’s decision in Dan’s City Used Cars, Inc. v. Pelkey (2013) 569 U.S. _ [ 185 L.Ed.2d 909 , 133 S.Ct. 1769 ] (Pelkey) is misplaced. At issue in that case was the preemption provision of the Federal Aviation Administration Authorization Act of 1994 (FAAAA; Pub.F. No. 103-305 (Aug. 23, 1994) 108 Stat. 1569 ), which generally precludes any state from enacting or enforcing a law “related to a price, route, or service of any motor carrier . . . with respect to the transportation of property.” ( 49 U.S.C. § 14501 (c)( 1), italics added.) As explained by the high court, “[although [49 U.S.C.] § 14501(c)(1) otherwise tracks the ADA’s air-carrier preemption provision [(Rowe, supra, 552 U.S. at p. 370)], the FAAAA formulation contains one conspicuous alteration—the addition of the words ‘with respect to the transportation of property.’ That phrase ‘massively limits the scope of preemption’ ordered by the FAAAA. [Citation.] [Thus,] . . . for purposes of FAAAA preemption, it is not sufficient that a state law relates to the ‘price, route, or service’ of a motor carrier in any capacity; the law must also concern a motor carrier’s ‘transportation of property.’ [Citation.]” (Pelkey, supra, 569 U.S. at p. _ [133 S.Ct. at pp. 1778-1779], fn. omitted.) The Attorney General also requests that we consider certain cases that have been decided since the briefs were filed in this matter. However, these cases, like Pelkey, are inapposite as they also concern the scope of the FAAAA’s preemption provision ( 49 U.S.C. § 14501 (c)(1)) as applied to state enforcement of labor and employment laws against motor carriers. (See Dilts v. Penske Logistics, LLC (9th Cm 2014) 769 F.3d 637 , 647, cert. den. (2015) 575 U.S. _ [ 191 L.Ed.2d 956 , 135 S.Ct. 2049 ]; Pac Anchor Transportation, supra, 59 Cal.4th at p. 783; Godfrey v. Oakland Port Services (2014) 230 Cal.App.4th 1267 , 1279-1283 [ 179 Cal.Rptr.3d 498 ], cert. den. (2015) 577 U.S. _ [ 193 L.Ed.2d 228 , 136 S.Ct. 318 ].) Here, we are concerned with whether the ADA ( 49 U.S.C. § 41713 (b)(1)) preempts state enforcement of the OPPA, which law we have concluded is “paradigmatic of the consumer protection legislation” at issue in Morales and Wolens. (Wolens, supra, 513 U.S. at pp. 227-228.)

16 We recognize that “[b]oth Morales and Wolens relied on doctrine developed under [the Employee Retirement Income Security Act of 1974 (ERISA) [ 29 U.S.C. § 1144 (a)]], and at the time the [high court’s] opinions tended to read the ERISA language broadly. [(See, e.g.. Morales, supra, 504 U.S. at pp. 383-384, relying on Shaw v. Delta Air Lines, Inc. (1983) 463 U.S. 85 [ 77 L.Ed.2d 490 , 103 S.Ct. 2890 ].)] . . . More recent decisions hold that state laws of general applicability are not preempted just because they have economic effects on pension or welfare plans. [(See, e.g.. New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co. (1995) 514 U.S. 645 [ 131 L.Ed.2d 695 , 115 S.Ct. 1671 ]; California Div. of Labor Standards Enforcement v. Dillingham Constr, N. A., Inc. (1997) 519 U.S. 316 , 319, 325, 330-331 [ 136 L.Ed.2d 791 , 117 S.Ct. 832 ]; De Buono v. NYSA-ILA Medical and Clinical Services Fund (1997) 520 U.S. 806 [ 138 L.Ed.2d 21 , 117 S.Ct. 1747 ].)] . . . But if developments in pension law have undercut holdings in air-transportation *907 law, it is for the [United States] Supreme Court itself to make the adjustment. [We must] follow decisions until the [United States] Supreme Court overrules them. [(State Oil Co. v. Khan (1997) 522 U.S. 3 , 20 [ 139 L.Ed.2d 199 , 118 S.Ct. 275 ] [it is the high court’s “prerogative alone to overrule one of its precedents”]; Rodriguez de Quijas v. Shearson/Am. Ex. (1989) 490 U.S. 477 , 484 [ 104 L.Ed.2d 526 , 109 S.Ct. 1917 ] [“[i]f a precedent of [the high court] has direct application in a case, yet appeal's to rest on reasons rejected in some other line of decisions, the Court of Appeals should follow the case which directly controls, leaving to [the high court] the prerogative of overruling its own decisions”].)] (United Airlines. Inc. v. Mesa Airlines. Inc. (7th Cir. 2000) 219 F.3d 605 , 608; see Boon Ins. Agency v. American Airlines. Inc. (Tex.Ct.App. 2000) 17 S.W.3d 52 , 57, fn. 5 [the federal appellate court adheres to the high court’s discussion of the ADA’s preemption provision in Morales and Wolens and declines to extrapolate the later ERISA cases into speculation that the high court’s holdings in Morales and Wolens would be different today].) “[A]nd we doubt that [the Attorney General’s] position could be justified by the latest ERISA cases, even if we were free (which we are not) to prefer decisions such as De Buono and Dillingham over Wolens and Morales.” (Mesa Airlines, supra. 219 F.3d at p. 609.) The Attorney General’s reliance on cases that hold state law is preempted by the ADA only if the law “binds the carrier to a particular price, route, or service and thereby interferes with competitive market forces within the air' carrier industry,” cannot be reconciled with Morales (NAAG guidelines detailing how existing state laws applied to airfare advertising and frequent flyer programs held preempted), Wolens (Illinois Consumer Fraud Act held preempted) or Ginsberg (common law claim of implied breach of covenant of good faith and fair' dealing held preempted), which are “a long distance from” state laws or regulations binding a carrier to a particular' price, route, or service, and, thereby, interfering with competitive market forces within the air' carrier industry. (Mesa Airlines, supra. 219 F.3d at p. 609.)