Arizona Case Law

GALATI v. AMERICA WEST AIRLINES, 1 CA-CV 02-0170 (App. 2003)

CHARLES GALATI, Plaintiff-Appellant, v. AMERICA WEST AIRLINES, INC., an

Arizona corporation, Defendant-Appellee.

No. 1 CA-CV 02-0170

Court of Appeals of Arizona, Division One, Department D.

Filed June 3, 2003

Appeal from the Superior Court of Maricopa County, Cause No.

CV 01-015861, The Honorable SHERRY HUTT, Judge.

AFFIRMED

Frances G. Fanning Tempe, Attorney for Plaintiff-Appellant.

Brown & Bain, P.A., Phoenix, by Daniel C. Barr and Jill

J. Chasson, Attorneys for Defendant-Appellee.

OPINION.

THOMPSON, Judge

І 1 Charles Galati (Galati) appeals the trial court's dismissal

of his wrongful termination claim against America West Airlines,

Inc. (AWA). Finding that Galati did not state a viable claim for

wrongful termination, we affirm.

BACKGROUND

І 2 Galati was employed by AWA as a flight attendant until he was

discharged in January 1999. Galati filed suit against AWA asserting

he was wrongfully terminated for being a whistleblower. Specifically,

he claims AWA fired him because in November 1998 he complained about

being scheduled to work without the required Federal Aviation

Administration (FAA) rest breaks[fn1] and because he reported

to the FAA that an AWA pilot removed a "MEL sticker," signaling a

defect, without authority.

І 3 AWA filed an Arizona Rule of Civil Procedure 12(b)(6) motion

to dismiss the complaint, stating that Galati had not pled a

violation of Arizona statutory or constitutional law as required

by Arizona's Employment Protection Act (AEPA), Arizona Revised

Statutes (A.R.S.) sections 23-1501, -1502 (Supp. 2001). The trial

court dismissed the case, finding that Galati's action did not

comply with A.R.S. ї 23-1501 in that he alleged that he was

terminated for bringing to light violations of federal regulations.

Galati timely appealed.

DISCUSSION

І 4 Galati raises three issues:

1. Whether the Arizona Legislature in enacting the AEPA

intended to exclude federal regulations from the definition

of "public policy;"

2. If the legislature did intend to exclude federal

regulations from the definition of public policy, whether

that exclusion contravenes the Arizona Constitution; and

3. Whether the Airline Deregulation Act (ADA),

49 U.S.C. ї 41713 et seq. preempts a state cause of action for

wrongful discharge in violation of public policy.

We review the legal issues raised by Galati de novo and take as

true all facts alleged in his complaint. See Johnson v. McDonald,

197 Ariz. 155, 157, І 2, 3 P.3d 1075, 1077 (App. 1999).

A. Are Federal Regulations Excluded Under the AEPA's Definition

of Public Policy?

І 5 In 1996, the Arizona Legislature enacted the AEPA in response

to Wagenseller v. Scottsdale Memorial Hospital, 147 Ariz. 370,

710 P.2d 1025 (1985).[fn2] See Employment Protection Act Ch. 140,

ї 1, para. A, 1996 Ariz. Sess. Laws 683, 684. The AEPA spells out

the public policy of this state[fn3] and enumerates the four

circumstances under which an employee may bring a wrongful

termination action in Arizona. See A.R.S. ї 23-1501. One such

circumstance is when an employer violates "a statute of this

state" or "the public policy set forth in or arising out of the

statute." A.R.S. ї 23-1501(3)(b). Another is when the employer

terminates an employee in retaliation for refusing to violate

Arizona law or for reporting violations of Arizona law to the

employer's management or other investigative authority. A.R.S.

ї 23-1501(3)(c)(i), (ii).

І 6 Galati presents two arguments in support of his assertion

that his claim for wrongful discharge is cognizable. First, under

the AEPA, he asserts that firing a whistleblower who has reported

violations of federal law constitutes a retaliatory termination

against Arizona's public policy. Thus, he asserts that A.R.S. її

23-1501(3)(c)(i)(covering retaliatory firings for an employee's

refusal to violate Arizona law) and(c)(ii)(covering retaliatory

firings for an employee's disclosure of violations of Arizona

law) apply in this case. Next, Galati asserts that his cause of

action also "finds its roots in the common law." AWA asserts that

the AEPA is limited to violations of Arizona law and abrogates

claims of wrongful discharge based on common law.

І 7 In his statutory argument, Galati contends that the Arizona

Legislature must have intended that Arizona public policy

incorporate federal law, although he admits that the face of the

AEPA appears to contemplate only the body of law promulgated

under state legislative authority. The question is whether

violations of federal regulations are necessarily violations of

Arizona public policy under the AEPA.

І 8 To determine whether the Arizona Legislature intended to

include federal regulations in the public policy to be vindicated

by the AEPA, we look first at the language of the statute itself.

See Carden v. Golden Eagle Ins. Co., 190 Ariz. 295, 297,

947 P.2d 869, 871 (App. 1997) (stating that the best way to give effect to

the legislative intent is to follow the clear and unequivocal

language of the statute)(citing Lowing v. Allstate Ins. Co.,

176 Ariz. 101, 103, 859 P.2d 724, 726 (1993)). "[T]he best and most

reliable index of a statute's meaning is its language and, when

the language is clear and unequivocal, it is determinative of the

statute's construction." Janson v. Christensen, 167 Ariz. 470,

471, 808 P.2d 1222, 1223 (1991). If the language is clear, we

will follow the text as written, without employing other methods

of statutory construction. State v. Riggs, 189 Ariz. 327, 333,

942 P.2d 1159, 1165 (1997).

І 9 The language chosen by our legislature is unequivocal.

Section 23-1501(3)(b) provides a remedy if "[t]he employer has

terminated the employment relationship of an employee in

violation of a statute of this state." (Emphasis added). Section

23-1501(3)(c)(i) provides a remedy if the employee is terminated

in retaliation for refusing to commit an act or omission "that

would violate the Constitution of Arizona or the statutes of this

state." (Emphasis added). Section 23-1501(3)(c)(ii) provides a

remedy if the employee is terminated for disclosing to the employer,

its representative, or an investigatory body a violation of "the

Constitution of Arizona or the statutes of this state." (Emphasis

added). No mention is made of any federal provision, statute or

regulation. As Galati acknowledges, the language plainly appears

to contemplate only transgressions of Arizona law as violative of

Arizona public policy.

І 10 Due to the express and unequivocal language of the statute,

we need not inquire further to divine the legislature's intent on

this matter.[fn4] See UNUM Life Ins. Co. of Am., v. Craig,

200 Ariz. 327, 329-30, ІІ 11-12, 26 P.3d 510, 512-13 (2001) ("The

primary aim of statutory construction is to find and give effect

to legislative intent."). If the statute is clear we will

"generally apply it without using other means of construction."

Id. at 330, І 12, 26 P.3d at 513. The statute reiterates that it

is against violations of the Arizona Constitution and Arizona

statutes that protection is provided.

І 11 In support of his claim that federal regulations should be

included under the umbrella of public policy, Galati cites

Wagenseller, 147 Ariz. 370, 710 P.2d 1025; Wagner v. City of

Globe, 150 Ariz. 82, 722 P.2d 250 (1986); and Cummins v. Mold-in

Graphic Systems, 200 Ariz. 335, 26 P.3d 518 (App. 2001),

depublished, 201 Ariz. 474, 38 P.3d 12 (2002).

І 12 As mentioned previously, the AEPA was enacted in direct

response to Wagenseller and with the intent of limiting the

availability of wrongful termination for the violation of public

policy.[fn5] Nevertheless, Wagenseller was a case which would

have been cognizable under the AEPA had it existed at that time.

See Logan v. Forever Living Prods. Int'l., Inc., 203 Ariz. 191,

n. 6, І 16, 52 P.3d 760, n. 6 (2002).

І 13 Wagner was decided in 1986 and well before the enactment of

the AEPA. In Wagner, the plaintiff alleged that he was discharged

from his job as a policeman after he blew the whistle about a man

illegally charged with violating a void statute on vagrancy and

in violation of personnel regulations. 150 Ariz. at 84, 722 P.2d

at 252. It is clear that Wagner, like Wagenseller, would have

been able to pursue both his claims under the current version of

the AEPA and without relying on the common law.[fn6]

І 14 Cummins, like Wagner and Wagenseller, was a common law action

not brought under the AEPA, and has been depublished by order of

the Arizona Supreme Court. See Cummins, 201 Ariz. 474,

38 P.3d 12. Thus, Cummins has no precedential value on any issue,

including our determination whether a violation of federal

regulations could support a wrongful termination.

І 15 After a review of the clear and unequivocal language of

A.R.S. ї 23-1501 and the cases cited by Galati, we do not find

that a statutory public policy exception exists for

whistleblowing associated with federal regulations.

B. The Legislature Did Not Violate the Arizona Constitution By

Excluding Federal Regulations From Public Policy Under the AEPA

І 16 Galati asserts that the Arizona Legislature cannot have

excluded federal regulations from the AEPA without violating the

supremacy and the separation of powers clauses of the Arizona

Constitution.

І 17 Our supreme court addressed the constitutionality of the AEPA

in Cronin v. Sheldon, 195 Ariz. 531, 991 P.2d 231 (1999) (holding

that employees asserting wrongful termination claims against

their employers for violating the Arizona Civil Rights Act (ACRA)

were limited under the AEPA to the ACRA's statutory remedies).

The court in Cronin found that the AEPA does not violate the

equal privileges clause, the impairment of contract clause, the

anti-abrogation clause, the non-limitation clause or the

separation of powers clause.[fn7] Cronin, therefore, resolves

Galati's separation of powers argument whether the legislature

could enact the AEPA and regulate remedies under it.

І 18 Whether a common law tort for wrongful termination still

exists after the AEPA is an open and much debated question in

Arizona law. We need not reach that question because of our

determination of the preemption issue, to which we now turn.

C. The Airline Deregulation Act Preempts a State Cause of

Action for Wrongful Discharge

І 19 AWA asserts the federal ADA preempts Galati's state claims

and, to that end, cites Botz v. Omni Air International,

286 F.3d 488 (8th Cir. 2002). The ADA states:

[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. . . .

49 U.S.C. ї 41713(b)(1) (1994).

І 20 Botz, like Galati, was a flight attendant who objected to a

schedule that she believed violated FAA regulations on flight

time. See 286 F.3d at 490. The Eighth Circuit Court of Appeals

rejected Botz's state claim for wrongful termination in violation

of Minnesota's whistleblower statute on the basis of preemption.

Id. at 498; see Minn. Stat. ї 181.932 (prohibiting discharge of

employee for refusing employer's order to violate any "state or

federal law or rule or regulation").[fn8]

І 21 The airline in Botz argued that Botz's claims were

unmistakably preempted under a recent addition to the ADA called

the Whistleblower Protection Program (WPP).[fn9] 286 F.3d at

490-92. The airline also argued that these same claims were

always preempted by the ADA itself, which was enacted in 1978.

Id. The circuit court recognized that the United States Supreme

Court had directed an expansive view of the preemption provision

of the ADA in Morales v. Trans World Airlines, Inc., 504 U.S. 374

(1992). 286 F.3d at 494.

І 22 The circuit court in Botz persuasively identified the impacts

that conduct protected by the whistleblower statute would have on

airline service, focusing in particular on the circumstance that

a flight attendant's refusal of an assignment would jeopardize

"an air carrier's ability to complete its scheduled flights." 286

F.3d at 494. Because federal regulations specify the minimum

number of flight attendants required, an employee's refusal of an

assignment could ground a scheduled flight. Id. The court

concluded that the "authorization to refuse assignments, and the

protections that the whistleblower statute provides, have a

forbidden connection with an air carrier's service under any

reasonable interpretation of Congress's use of the word

`service.'" Id. at 495.

І 23 In the same way, if Arizona law protected Galati's refusal of

the assignment made by his employer, it would contravene the

ADA's preemption of state laws relating to airline service. As

the Botz court stated, "the plain language of the ADA's

pre-emption provision" precludes such a claim. Id. at 498.

І 24 As we have noted, the Botz court cited a pre-WPP case,

Morales, in support of its broad interpretation of the scope and

application of the ADA's preemption provision. 286 F.3d at 493-95

(noting inter alia that a state law may impermissibly relate to

air-carrier service even if not specifically designed to do so).

The court also noted the prohibition of a state's attempt to

impose its own public policy on an air carrier's operations as

declared in American Airlines, Inc. v. Wolens, 513 U.S. 219

(1995). 286 F.3d at 494. In Wolens, the United States Supreme

Court acknowledged that the statute in question, relating to

consumer fraud, had general applicability and did not target

airline operations, but was nonetheless preempted by the ADA. 513

U.S. at 227-28. The court held that the ADA's purpose is "to

leave largely to the airlines themselves, and not at all to the

States, . . . the furnishing of air transportation services." Id.

at 228. The states may not regulate, in the guise of statutes of

general applicability such as those providing whistleblower

protection, the provision of transportation services by airlines.

І 25 In support of his claims that the ADA is not preempted,

Galati cites Air Transport Ass'n of America v. San Francisco,

266 F.3d 1064 (9th Cir. 2001) (finding no preemption when airlines

brought action against the city challenging validity of ordinance

requiring city to contract only with companies that did not

discriminate between employee's spouses and domestic partners in

respect to travel benefits) and Aloha Islandair Inc. v. Tseu,

128 F.3d 1301 (9th Cir. 1997) (finding no preemption when airline

sought declaratory and injunctive relief to prohibit the Hawaii

Civil Rights Commission from enforcing state disability

discrimination laws against airline with respect to a monocular

pilot applicant). Air Transport and Aloha, both dealing with

local or state anti-discrimination provisions that had no more

than a peripheral relation to the provision of airline services,

do not detract from the force of the preemption analysis

presented in Botz, which we deem persuasive.

І 26 Since our supremacy clause requires that Arizona not act when

preempted by federal law, we can take no further action here. See

Fain Land & Cattle Co., v. Hassell, 163 Ariz. 587, 594,

790 P.2d 242, 249 (1990); Hernandez-Gomez v. Volkswagen of Am., Inc.,

201 Ariz. 141, 142, І 3, 32 P.3d 424, 425 (App. 2001). We note that

the WPP now provides its own statutory remedy for claims such as

that of Galati. See 49 U.S.C. ї 42121(b)(3)(B).[fn10]

І 27 Because we find that the ADA preempts Galati's attempt to

bring a state cause of action either under the AEPA or Arizona's

common law, we affirm the trial court.

D. Attorneys' Fees on Appeal

І 28 Galati's request for an award of fees on appeal pursuant to

A.R.S. ї 12-341.01 and Wagenseller is denied.

CONCLUSION

І 29 For the above stated reasons, we affirm the trial

court.

______________________________

JON W. THOMPSON, Judge

CONCURRING:

_____________________________

WILLIAM F. GARBARINO, Presiding Judge

_____________________________

SUSAN A. EHRLICH, Judge

ORDER

The above-entitled matter was duly submitted to the Court.

The Court has this day rendered its opinion.

IT IS ORDERED that the opinion be filed by the Clerk.

IT IS FURTHER ORDERED that a copy of this order together with

a copy of the opinion be sent to each party appearing herein or

the attorney for such party and to The Honorable Sherry Hutt,

Judge.

______________________________

JON W. THOMPSON, Judge

[fn1] The regulation in question is 14 C.F.R. ї 121.471.

[fn2] In Wagenseller, our supreme court held that an

at-will employee of a hospital could bring a wrongful termination

suit alleging that she was fired in violation of a public policy

of this state. 147 Ariz. at 389, 710 P.2d at 1044. The court

said that "an employer may fire for good cause or for no cause.

He may not fire for bad cause -- that which violates public

policy." Id. at 378, 710 P.2d at 1033. The court defined public

policy to include not only violations of our statutory and

constitutional law, but the common law as well. See id. at

378-80, 710 P.2d at 1033-35. The legislature in enacting A.R.S. ї

23-1501 took express exception to the court's indication that it

rather than the legislature had the authority to define public

policy. See Employment Protection Act Ch. 140, ї 1, para. A,

1996 Ariz. Sess. Laws 683, 684.

[fn3] Under the AEPA it is the public policy of Arizona

that employment relationships are contractual in nature and that,

absent a contract complying with the requirements outlined in the

AEPA, an employment relationship is severable at the pleasure of

either party. A.R.S. ї 23-1501(1), (2).

[fn4] Not that divining the legislature's intent here

would have been difficult given that the preamble states that the

AEPA was intended to narrow the availability of wrongful

termination claims. See Employment Protection Act Ch. 140, ї 1,

para. A, 1996 Ariz. Sess. Laws 683, 684.; see also Johnson v.

Hispanic Broadcasters of Tucson, Inc., 196 Ariz. 597, 599, І 4,

2 P.3d 687, 689 (App. 2000) ("the legislature's stated intent . . .

was to limit the circumstances in which a terminated employee can

sue an employer to those situations involving either qualifying

written contracts or an employer violating the public policy of

the state as enunciated in the state constitution and statutes").

This intent can be seen not only in the above cited provisions but

also in the fact that our legislature also acted to prohibit

wrongful termination claims based on public policy when other

statutes of this state, for example civil rights statutes, provide

their own remedy. See A.R.S. ї 23-1501(3)(b).

[fn5] This court recently declined to recognize the

availability of common law wrongful termination claims in light of

the AEPA. See Johnson, 196 Ariz. 597, 2 P.3d 687 (declining to

find a common law action for wrongful termination when the alleged

employment contract did not conform to A.R.S. ї 23-1501(2)). We

address Galati's asserted common law claim below.

[fn6] Wagner could also have relied on A.R.S. ї 38-532(A)(1) (2001)

which makes it a prohibited personnel practice to

discharge a public employee in retaliation for that employee's

disclosure of a "violation of any law."

[fn7] The court in Cronin did find that the preamble

violated the separation of powers clause by "usurp[ing] judicial

authority" to determine the law. Id. at 538, ІІ 30-31, 991 P.2d

at 238.

[fn8] Notably, the Minnesota statute in Botz is written

significantly more broadly than Arizona's AEPA. The Minnesota

statute includes whistleblowing for violations of "any law."

Minn. Stat. ї 181.932.

[fn9] The WPP applies to fiscal years beginning after

September 30, 1999. See Wendell H. Ford Aviation Investment and

Reform Act for the 21st Century, Pub.L. No. 106-181, ї 3, 114

Stat. 61, 64 (2000) (codified as 49 U.S.C. ї 106 (2003)).

[fn10] It also appears that Galati had a remedy under the

Railway Labor Act, 45 U.S.C. ї 151 et seq. The Act provides,

inter alia, a statutory scheme for resolving employer-employee

disputes arising in the airline industry. See Paul J. Zech,

Federal Pre-emption and State Executive Remedy Issues in

Employment Litigation, 72 N.D. L. Rev. 325, 333 (1996). Galati

brought a claim under the Railway Labor Act, but it was dismissed

as untimely.

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