Sholopa v. Turkish Airlines, Inc.
- Andrew Carter
- 1:20-cv-03294
- U.S. District Court · Southern District of New York
- 11
In Sholopa v. Turkish Airlines, Judge Carter denied the defendants’ motion to dismiss claims over refunds for pandemic-canceled flights.
The ruling affected Svetlana Sholopa and Milica Milosevic’s contract claims against the Turkish Airlines defendants. It allowed those claims to proceed past the motion-to-dismiss stage; the opinion did not decide the ultimate merits of the alleged breach or certify a class.
What happened
Sholopa v. Turkish Airlines, Inc. concerns tickets for flights canceled during the COVID-19 pandemic. Svetlana Sholopa and Milica Milosevic alleged that Turkish Airlines breached its contract by not providing refunds or another option required by the airline’s conditions of carriage. Sholopa bought her ticket through a third-party travel website, while Milosevic bought hers directly from Turkish Airlines.
The defendants argued that Sholopa lacked standing or that her claim became moot after she received a refund, that a website forum-selection clause required Milosevic to sue in courts in Istanbul or Bakirkoy, that federal airline law preempted the claims, and that the complaint did not adequately allege breach of contract. The court rejected each argument. It held that Sholopa had standing when she sued and that her claim was not moot because the refund did not provide all possible relief. It also held that the website clause did not cover Milosevic’s separate contract claim, that the federal law did not preempt the contract claims, and that the complaint adequately stated a claim.
Judge Andrew L. Carter, Jr. denied the motion in its entirety. The ruling allowed the plaintiffs’ claims to continue at this stage; it did not decide whether the defendants ultimately breached the contract.
The detailed version
- Sholopa v. Turkish Airlines, Inc. · No. 1:20-cv-03294
- Andrew Carter
- Mar. 31, 2022
Background
Svetlana Sholopa and Milica Milosevic sued Turkish Airlines entities on behalf of themselves and others similarly situated. Their flights were canceled because of the COVID-19 pandemic. Sholopa purchased her ticket through a third-party travel website, and Milosevic purchased her tickets directly from Turkish Airlines. Both alleged that the airline’s refusal to issue refunds breached the General Conditions of Carriage, which the opinion describes as a contract between the parties.
The defendants moved to dismiss. They argued that Sholopa lacked standing, or that her claim was moot, because she received a refund after filing suit; that a forum-selection clause on the airline’s website required Milosevic to bring her claim in the Istanbul/Bakirkoy courts; that the Airline Deregulation Act preempted the claims; and that the complaint failed to state a breach-of-contract claim.
Sholopa’s standing and mootness
The court held that Sholopa had standing when she filed the original complaint. The court explained that standing concerns whether a plaintiff had a sufficient stake when the lawsuit began, while mootness concerns whether that interest continues during the lawsuit. Because Sholopa received her refund after filing the lawsuit, the refund did not eliminate her standing.
The court also held that the refund did not make her claim moot. No judgment had been entered against the defendants, and the refund did not provide complete relief because, if a class were certified and the plaintiffs prevailed, Sholopa could receive an additional award as a class representative.
Forum-selection clause
The website’s terms required covered claims to be brought in the Istanbul/Bakirkoy courts. The court found that the clause was adequately communicated to Milosevic because she checked a box stating that she had read and accepted the website’s terms. The court also found that the clause was mandatory rather than merely permissive.
The court nevertheless held that the clause did not cover Milosevic’s claim. Her claim concerned a breach of the separate General Conditions of Carriage contract, not a problem with using the website. The court reasoned that the website’s definition of “Material” referred to software, programs, data, information, and databases, and did not establish that the ticket or the conditions of carriage were covered material. The court therefore rejected the defendants’ argument that Milosevic’s claim had to be brought in the Istanbul/Bakirkoy courts.
Airline Deregulation Act
The court held that the Airline Deregulation Act did not preempt the plaintiffs’ claims. The Act generally prevents states from enforcing laws related to an air carrier’s prices, routes, or services, but the court explained that this restriction does not shield airlines from claims based on their own contractual promises. Because the plaintiffs asserted breach-of-contract claims, the court concluded that those claims were not preempted.
Sufficiency of the contract claim
Under New York law, a breach-of-contract claim requires a contract, a breach, and resulting damages. The defendants did not dispute that a contract existed. They argued that the contract gave the airline several ways to respond to a canceled flight, so the plaintiffs could not proceed merely because they wanted refunds.
The court disagreed at the pleading stage. It read the General Conditions of Carriage as allowing Turkish Airlines to provide a refund, carry the passenger on another scheduled flight, reroute the passenger using its own or another carrier’s flights, or use ground transportation. The airline would not breach the contract merely because a flight was canceled, but it could breach the contract if it failed to provide any of those listed alternatives. The court found that the plaintiffs did not allege, and the record did not show, that the defendants had provided one of those alternatives. The possibility that later fact discovery might support dismissal did not justify dismissal at this stage.
Disposition
Judge Andrew L. Carter, Jr. denied the defendants’ motion to dismiss in its entirety.
Read the full 11-page opinion on CourtListener, the free public archive maintained by the Free Law Project.