Schneberger v. Air Evac EMS

FILED
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS August 31, 2018
Elisabeth A. Shumaker
TENTH CIRCUIT Clerk of Court
SUSAN SCHNEBERGER; LACY
STIDMAN; JOHNNY TRENT,
individually and as class
representatives,
Plaintiffs - Appellants,
v. No. 17-6154
(D.C. No. 5:16-CV-00843-R)
AIR EVAC EMS, INC., d/b/a Air Evac (W.D. Okla.)
Lifeteam; EAGLEMED, LLC,
Defendants - Appellees.
ORDER AND JUDGMENT *
Before HOLMES, MATHESON, and MORITZ, Circuit Judges.
Susan Schneberger, Lacy Stidman, and Johnny Trent brought claims on
behalf of themselves and a putative class of similarly situated individuals against
air-ambulance operators in Oklahoma, alleging that the defendants charged
exorbitant rates for air-ambulance services. They claimed breach of implied
contract because the parties did not agree on a particular price before services
*
This order and judgment is not binding precedent except under the
doctrines of law of the case, res judicata, and collateral estoppel. It may be cited,
however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th
Cir. R. 32.1.
were provided; therefore, the plaintiffs argued, the defendants agreed to transport
the plaintiffs and their family members for a reasonable price. They also brought
claims, inter alia, for unjust enrichment and money had and received. The district
court dismissed these claims as preempted by the Airline Deregulation Act
(“ADA”), 49 U.S.C. § 41713. Exercising jurisdiction under 28 U.S.C. § 1291, we
affirm.
I1
A
Defendants EagleMed, LLC (“EagleMed”) and Air Evac EMS, Inc. (“Air
Evac”) operate air-ambulance services in several states, including Oklahoma.
They do not dispatch their own services, but instead respond to third-party
dispatch requests and requests from medical professionals or first responders.
The plaintiffs claim that they or their family members were transported by
the defendants “without entering into written agreements specifying a price prior
to transport.” Aplts.’ Opening Br. at 3. No price or schedule of prices was
disclosed at the time of service. The plaintiffs claim that the defendants “do not
negotiate rates with patients” or “publish their pricing model in any available
platform.” Aplts.’ App. at 27 (Pet., dated July 26, 2016). The plaintiffs further
1
In reviewing a judgment on a motion to dismiss, “[w]e accept as true
all well-pleaded factual allegations in the complaint.” S.E.C. v. Shields, 744 F.3d
633, 640 (10th Cir. 2014) (quoting Burnett v. Mortg. Elec. Registration Sys., Inc.,
706 F.3d 1231, 1235 (10th Cir. 2013)).
2
argue that the emergency conditions under which the transportation here took
place precluded any “meaningful opportunity to consent” to the terms of service.
Aplts.’ Opening Br. at 4. 2
Ms. Schneberger’s husband was transported 416 miles by EagleMed from
Norman Regional Hospital in Norman, Oklahoma, to MD Anderson Hospital in
Houston, Texas. Mr. Schneberger was insured by Blue Cross Blue Shield
Association (“BCBS”), but BCBS refused to pay for EagleMed’s service because
it concluded that his transportation was not medically necessary. EagleMed
reduced Mr. Schneberger’s bill from $63,564.71 to $53,133.83. Ms. Stidman was
2
In EagleMed LLC v. Cox, 868 F.3d 893 (10th Cir. 2017), we detailed
a similar description of “the market for air-ambulance services” offered by an
amicus and, notably, did not quarrel with its accuracy:
Unlike the typical commercial airline flights that were the focus
of the [ADA], air-ambulance flights generally are not chosen by
their passengers, are not paid in advance at an agreed-to rate, and
do not have prices that are determined in a free market of
individual consumer choice. As a general rule, air-ambulance
services are not requested or arranged by either the individuals
who will receive the services or by the insurance companies,
governmental entities, or individuals who will ultimately pay for
them. Rather, air ambulances are called by medical professionals
and emergency first-responders who will neither receive nor pay
for their services. Their prices are determined only after the
service has already been rendered—in cases paid through
Medicare or Medicaid, at prices established by government rate
schedules, and in cases paid through private insurance, usually at
a price negotiated between the air ambulance and the insurer.
Id. at 902–03.
3
transported sixty-seven miles by EagleMed from Pittsburg County, Oklahoma, to
St. John Medical Center in Tulsa, Oklahoma. Ms. Stidman’s insurance paid
$15,180.53 of EagleMed’s charges, leaving her with a bill for $19,516.26. Mr.
Trent was transported 106 miles by Air Evac from Elk City, Oklahoma, to
Oklahoma City after an oilfield accident. Air Evac charged Mr. Trent
$45,101.94.
The plaintiffs argue that they were charged for transportation “in an amount
that vastly exceeded both the cost to provide the transport and the fair market
value of the transport.” Aplts.’ Opening Br. at 4. The plaintiffs proffered
statements by “[a]n executive of the largest air ambulance company in the
industry admitt[ing] that the fair charge for an average transport would be
$12,000” and claimed that they were charged between four and eight times that
amount. Id. (emphasis added) (citing Aplts.’ App. at 131 (Pls.’ Joint Resp. to
Defs.’ Mot. to Dismiss, dated Dec. 20, 2016)). When the plaintiffs were unable to
pay, the defendants began collection efforts that exposed the plaintiffs to “adverse
judgments and damage to their credit ratings.” Id. at 5. The defendants do not
contest that the written agreements between the parties lacked an agreed-upon
price. The defendants argue, however, that they are required by law to transport
patients who require services regardless of their insurance coverage or ability to
pay. Providing these services is expensive—requiring the defendants to maintain
customized aircraft and twenty-four-hour crews—and payments received from
4
uninsured patients or patients covered by Medicaid or Medicare are, in general,
“substantially below air ambulance providers’ per-transport costs.” Aplees.’
Resp. Br. at 9. “Such underpayments contribute to escalating prices for
emergency air ambulance transportation.” Id. And in order “[t]o continue to
provide air ambulance service for everyone regardless of insurance status . . . [the
defendants] must receive their billed charges for a sufficient portion of their
flights to offset the losses they incur when they transport uninsured or
underinsured patients.” Id. at 10.
B
The plaintiffs filed claims in the state District Court for Oklahoma County,
Oklahoma, seeking damages and injunctive relief prohibiting the defendants from
charging or attempting to collect “unreasonable rates” for their services. Aplts.’
App. at 48–51. The plaintiffs presented several claims under Oklahoma law,
including claims for breach of an implied contract (including breach of the
implied covenant of good faith and fair dealing), unjust enrichment, and money
had and received. 3 The plaintiffs argued that, due to the lack of a specified price
term, the parties entered into implied contracts for services to be provided at a
3
The plaintiffs also brought a claim alleging violations of the
Oklahoma Consumer Protection Act, O KLA . S TAT . A NN . tit. 15, § 751, but they
voluntarily conceded that this claim should not go forward in their briefing
responding to the defendants’ motion to dismiss, discussed infra, and the federal
district court acknowledged the concession and did not address the claim further
in its dismissal order.
5
reasonable price, and the defendants breached those contracts. In the alternative,
the plaintiffs sought a declaratory judgment that the contracts between the parties
were “unenforceable . . . because of the lack of mutuality.” Aplts.’ App. at 50.
The defendants removed the case to the U.S. District Court for the Western
District of Oklahoma.
The defendants then moved to dismiss the complaint, arguing that all of the
plaintiffs’ state-law claims were preempted by the ADA. The statutory
preemption provision says the following:
Except as provided in this subsection, 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 that may provide air
transportation under this subpart.
49 U.S.C. § 41713(b)(1). The defendants argued that, under the ADA, the
Department of Transportation’s (“DOT”) regulatory mechanism provides the
exclusive remedy against abusive pricing practices by airlines. The plaintiffs
responded that DOT regulations provide some remedy against misleading
advertising of prices, but that they offered no relief here because the defendants
did not disclose their prices at all. Reflecting the substance of their district court
argument, the plaintiffs put it this way on appeal: “If the District Court lacks
authority to address Defendants’ outrageous, after-the-fact pricing regime, then
there is no remedy for Plaintiffs. Defendants can charge whatever they want, and
no judicial or agency review constrains their unfettered discretion.” Aplts.’
6
Opening Br. at 6. The plaintiffs further argued that the defendants were estopped
from claiming ADA preemption because they had sought to recover their fees in
state-court actions.
Finally, the plaintiffs argued that the policy choice underlying the
ADA—that is, to limit regulation in order to maximize the effects of market
forces on prices in the airline services industry—was not applicable to the air-
ambulance market because patients “have no way to shop for air ambulance
services.” Id. No “market” exists, the plaintiffs argued, because there is no
“opportunity for a consumer to compare competing providers based on price or
other variables.” Id.The district court rejected the plaintiffs’ arguments and granted the
defendants’ motion to dismiss. At the outset of considering the defendants’
preemption argument, the court concluded that it was “settled” that the defendants
were “air carriers” within the meaning of the ADA, 49 U.S.C. § 41713(b)(1), and
thus within the ambit of that statute’s preemption protections. 4 Aplts.’ App. at
4
The plaintiffs admit that they did not challenge the district court’s
determination that the defendants were “air carriers” within the meaning of the
ADA, but state in their reply brief that this “tactical decision not to raise the issue
was a mistake.” Aplts.’ Reply Br. at 2 n.1. Perhaps. But it is a mistake that the
plaintiffs will have to live with. We decline to consider their
arguments—presented for the first time in their reply brief—challenging the
defendants’ status as “air carriers.” See Reedy v. Werholtz, 660 F.3d 1270, 1274
(10th Cir. 2011) (“‘[T]he general rule in this circuit is that a party waives issues
and arguments raised for the first time in a reply brief.’ We see no reason to
(continued...)
7
263 (Order, dated Mar. 15, 2017). The court then found that all of the plaintiffs’
claims were preempted by the ADA.
The court reasoned that the plaintiffs’ claim for breach of an implied
contract, including a covenant of good faith and fair dealing, “at bottom” evinced
the plaintiffs’ contention that “Defendants’ prices are unreasonably high under
Oklahoma law.” Aplts.’ App. at 266. Furthermore, the court said, “it is
immaterial whether Plaintiffs package their claim as one for charging
unreasonable rates or one for failing to deal in good faith; Plaintiffs are still
alleging that Defendants breached the ‘state-imposed obligation[]’ to charge
4
(...continued)
depart from that rule here.” (alteration in original) (citation omitted) (quoting
M.D. Mark, Inc. v. Kerr–McGee Corp., 565 F.3d 753, 768 n.7 (10th Cir. 2009))).
Furthermore, the plaintiffs’ contention—made without any citation to
authority—that we “could conceivably address” their challenge to the defendants’
status as “air carriers” “even though not raised below” because they are
“jurisdictional” is wholly without merit. Aplts.’ Reply Br. at 2. n.1. Jurisdiction
here does not turn on whether the defendants are “air carriers” under the ADA; to
the contrary, that status is germane (under the circumstances of this case) to only
whether the defendants can prevail on their preemption defense to federal-court
jurisdiction over their state-law claims—jurisdiction that the district court
grounded on the Class Action Fairness Act, 28 U.S.C. § 1332(d). See Wayne v.
DHL Worldwide Express, 294 F.3d 1179, 1183 (9th Cir. 2002) (“Because
preemption as a defense does not provide a basis for federal jurisdiction, a
separate basis for federal question jurisdiction over Wayne’s complaint must exist
before removal was proper. Thus, we need not decide whether the product offered
by DHL constitutes a ‘price, route, or service of an air carrier,’ 49 U.S.C. §
41713(b), unless we first determine that the district court had jurisdiction over
Wayne’s action.”); cf. Parise v. Delta Airlines, Inc., 141 F.3d 1463, 1466 (11th
Cir. 1998) (“In resolving the jurisdictional question potentially raised by a statute
such as the ADA, however, it is the cause of action and the underlying state law
on which it is founded that concerns us.”).
8
reasonable rates.” Id. at 267 (alteration in original) (quoting Am. Airlines, Inc. v.
Wolens, 513 U.S. 219, 228 (1995)). And claims relying on such state-law
obligations, said the court, are preempted by the ADA. Specifically, it stated: “If
Plaintiffs were simply attempting to enforce a specific term of the contract, their
claims could proceed . . . . Because they are not, preemption applies.” Id. at 268(citation omitted). 5
In rejecting the plaintiffs’ other claims, the court opined further:
Because Plaintiffs’ remaining claims all stem from the belief that
these rates were excessive, they too must be dismissed. Their
claim for money had and received relies on the failed argument
that Defendants’ rates were unreasonable . . . . Plaintiffs’ request
for injunctive and declaratory relief all hinge on the Court
finding that Oklahoma law bars Defendants from charging these
rates. The ADA therefore preempts these claims as well .
5
The district court elaborated on its reasoning in a helpful manner:
[P]erhaps all that is certain is there was no supplied price. But to
ask the Court, or rather state law, to dictate one is to make the
sort of policy judgment that invites ADA preemption. Defendants
believe they are entitled to the full charges. Requiring them to
accept less because of a policy-based inquiry—what’s a
reasonable rate for air ambulance services?—necessarily imposes
upon them a rate that “the State dictates” rather than one that
“the [air carrier] itself undertakes.”
Aplts.’ App. at 269 (second alteration in original) (quoting Wolens, 513 U.S. at
233).
9
Id. at 271 (citation omitted). The court ruled that the plaintiffs could “always
lodge their complaints with the [DOT]” and that the “adequacy of this remedy is
for Congress, not the courts, to decide.” Id. at 270.
The court was sympathetic to the plaintiffs’ policy arguments but
nevertheless found them irrelevant in light of the clear statutory language and
caselaw interpreting it:
[P]erhaps the statute is particularly ill-suited to regulate air
ambulance services given the lack of consumer choice in the
market for air ambulance services. In fact, finding preemption
here might further suppress competition in this industry. But
those reasons . . . do not grant the Court leave to discard the
Supreme Court’s decisions . . . characterizing Plaintiffs’ claim as
the precise type of state enforcement action preempted by the
ADA.
Id. 6
6
In this way, the district court’s analysis was quite consistent with the
analysis that we subsequently articulated in Cox. In that case, we observed that
“[t]here is certainly some persuasive force to the amicus argument that federal
preemption of state regulations in this field is not serving the congressional
purpose of ‘further[ing] efficiency, innovation, and low prices’ that was a
motivating force behind the [ADA].” Cox, 868 F.3d at 903 (second alteration in
original) (citation omitted) (quoting Morales v. Trans World Airlines, Inc., 504
U.S. 374, 378 (1992)). Nevertheless, we felt obliged to adhere to “the plain
language” of the ADA and thus concluded that “[b]ecause air ambulances are
included within the broad language of the [ADA’s] preemption statute as it is
currently written, we must reject Amicus’s policy-based reasons for holding that
the Wyoming statute and rate schedule should be exempted from federal
preemption in this case.” Id. at 904. Ultimately, we concluded that “[t]he plain
language of the [ADA] require[d] us to hold that the Wyoming Worker’s
Compensation Act and rate schedule are preempted to the extent that they set
mandatory fixed rates for reimbursement of air-ambulance claims.” Id. at 907.
10
The court also rejected the plaintiffs’ argument that the defendants were judicially
estopped from asserting preemption because, “at least to the Court’s knowledge,
Defendants have never asserted [that the] contracts are not enforceable and, at any
rate, this case does not concern Defendants’ collection efforts.” Id. at 268.
In sum, the district court found that the ADA preempted all of the plaintiffs’ substantive
claims and, in light of this preemption ruling, the plaintiffs’ claim for declaratory
relief had no legal foundation. After the court subsequently rejected the
plaintiffs’ motions to alter or amend the judgment under Federal Rule of Civil
Procedure 59 and for leave to amend their complaint under Federal Rule of Civil
Procedure 15, the plaintiffs filed this timely appeal. 7
II
A
We review de novo the district court’s grant of a motion to dismiss under Federal Rule
of Civil Procedure 12(b)(6). 8 See, e.g., Nakkhumpun v. Taylor, 782 F.3d 1142,
7
The plaintiffs make no meaningful arguments in their appellate
briefing challenging the district court’s rulings under Rules 59 and 15; therefore,
we deem any arguments regarding those rulings to be abandoned and waived.
See, e.g., Folks v. State Farm Mut. Auto. Ins. Co., 784 F.3d 730, 737 (10th Cir.
2015); United States v. Yelloweagle, 643 F.3d 1275, 1280–83 (10th Cir. 2011); cf.
Aplees.’ Resp. Br. at 53 (acknowledging that “Plaintiffs fail to identify any
separate challenge to the district court’s denial of their Rule 59 motion”
but—apparently out of an abundance of caution—addressing and rejecting such a
challenge).
8
The plaintiffs conclusorily assert—without any citation to
(continued...)
11
1146 (10th Cir. 2015). “[T]o withstand a Rule 12(b)(6) motion to dismiss, a
complaint must contain enough allegations of fact, taken as true, ‘to state a claim
to relief that is plausible on its face.’ A plaintiff must ‘nudge[] [his] claims
across the line from conceivable to plausible’ . . . .” Khalik v. United Air Lines,
671 F.3d 1188, 1190 (10th Cir. 2012) (third alteration in original) (quoting Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Dismissal is appropriate,
however, “on the basis of an affirmative defense like preemption when the law
compels that result.” Caplinger v. Medtronic, Inc., 784 F.3d 1335, 1341 (10th
Cir. 2015).
B
Under the Supremacy Clause of the United States Constitution, federal law may preempt
or supersede state law either impliedly or by express intention. See Hillsborough
Cty. v. Automated Med. Labs., Inc., 471 U.S. 707, 713 (1985). “‘[T]he purpose of
Congress is the ultimate touchstone’ in every pre-emption case.” Medtronic, Inc.
v. Lohr, 518 U.S. 470, 485 (1996) (quoting Retail Clerks Int’l Ass’n, Local 1625
v. Schermerhorn, 375 U.S. 96, 103 (1963)). Where a statute contains language
8
(...continued)
authority—that our standard of review is an abuse of discretion. See Aplts.’
Opening Br. at 7. We reject this baseless contention; even if the plaintiffs could
have mounted a colorable argument to this effect (which they could not), they
waived it by their inadequate briefing. See, e.g., Bronson v. Swensen, 500 F.3d
1099, 1104 (10th Cir. 2007) (“[W]e routinely have declined to consider arguments
that are not raised, or are inadequately presented, in an appellant’s opening
brief.”).
12
expressly preempting state law, “[t]he plain text of the [statute] begins and ends
[the] analysis” because “the plain wording of the [statute] . . . necessarily contains
the best evidence of Congress’ pre-emptive intent.” Puerto Rico v. Franklin Cal.
Tax-Free Tr., 136 S. Ct. 1938, 1946 (2016) (quoting Chamber of Commerce of
U.S. v. Whiting, 563 U.S. 582, 594 (2011)).
The ADA contains an express preemption clause:
Except as provided in this subsection, 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 that may provide air transportation under this subpart.
49 U.S.C. § 41713(b)(1). Congress enacted the ADA in 1978 “determining that ‘maximum
reliance on competitive market forces’ would best further ‘efficiency, innovation,
and low prices’” in the airline-services market. Morales v. Trans
World Airlines, Inc., 504 U.S. 374, 378 (1992) (quoting Pub. L. No. 95-504, § 102(a)(4) &
(9)). The preemption clause “ensure[s] that the States [do] not undo federal
deregulation with regulation of their own.” Id. (emphasis added).
Three Supreme Court cases guide our interpretation of the preemption provision under §
41713(b)(1). First, in Morales, the Court held that the ADA preempted
enforcement of state consumer-protection laws against airline advertisements,
holding that the disclosure requirements and content restrictions “would have a
significant impact upon the airlines’ ability to market their product, and hence a
significant impact upon the fares they charge.” Id. at 390. In this connection,
13
the Court observed that “the key phrase, obviously, is ‘relating to.’ The ordinary
meaning of these words is a broad one—‘to stand in some relation; to have
bearing or concern; to pertain; refer; to bring into association with or connection
with,’—and the words thus express a broad pre-emptive purpose.” Id. at 383
(citation omitted) (quoting Relate to, B LACK ’ S L AW D ICTIONARY (5th ed. 1979)).
Next, in Wolens, the Court again held that claims under a state consumer-protection act
were preempted; however, notably, it also held that contract claims arising from
an airline’s unilateral modification of the terms of a frequent flier program were
not preempted. 513 U.S. at 222. While the breach-of-contract claim “related to”
airline rates, the claim did not seek to vindicate a state-imposed obligation but
rather to enforce “privately ordered obligations” that were “voluntarily
undertaken” by the defendant airline. Id. at 228–29 (quoting Cipollone v. Liggett
Grp., Inc., 505 U.S. 504, 526 (1992) (plurality opinion)). More specifically, the
Court drew a distinction between such private obligations and laws through which
“States . . . seek to impose their own public policies or theories of competition or
regulation on the operations of an air carrier.” Id. at 229 n.5.
Finally, in Northwest, Inc. v. Ginsberg, 572 U.S. 273 (2014), the Court held that a state
common-law claim for breach of the implied covenant of good faith and fair
dealing was preempted “if it seeks to enlarge the contractual obligations that the
parties voluntarily adopt[ed].” Id. at 276. The Court reasoned that “the ADA’s
14
deregulatory aim can be undermined just as surely by a state common-law rule as
it can by a state statute or regulation.” Id. at 283. The Court, however, limited
its preemption holding to claims involving common-law doctrines like
Minnesota’s; in that regard, it expressly distinguished between states that “use the
[common-law] doctrine ‘to effectuate the intentions of parties or to protect their
reasonable expectations,’” and states like Minnesota that “clearly employ the
doctrine to ensure that a party does not ‘violate community standards of decency,
fairness, or reasonableness.’” Id. at 286 (first quoting Steven J. Burton, Breach of
Contract and the Common Law Duty to Perform in Good Faith, 94 H ARV . L. R EV .
369, 371 (1980), then quoting Universal Drilling Co., LLC v. R & R Rig Serv.,
LLC, 271 P.3d 987, 999 (Wyo. 2012)).
The Court rested its conclusion that Minnesota’s common-law doctrine was the
impermissible, policy-based type on negative answers to two independent
inquiries. First, the Court inquired whether the doctrine was waivable by the
contracting parties. It was undisputed that “under Minnesota law parties cannot
contract out of the covenant,” and the Court reasoned that “[w]hen the law of a
State does not authorize parties to free themselves from the covenant, a breach of
covenant claim is pre-empted under the reasoning of Wolens.” Id. at 287; see also
id. at 288 (“A State’s implied covenant rules will escape pre-emption only if the
law of the relevant State permits an airline to contract around those rules in its
frequent flyer program agreement, and if an airline’s agreement is governed by
15
the law of such a State, the airline can specify that the agreement does not
incorporate the covenant.” (emphasis added)).
Second, the Court considered—as an “additional, independent basis” for its
decision—whether the doctrine applies to every type of contract and also
answered this inquiry in the negative. Id. at 287. More specifically, it
determined that under Minnesota law there was an “exception for employment
contracts” and it was “based, in significant part, on ‘policy reasons,’ and
therefore the decision not to exempt other types of contracts must be based on a
policy determination [as well].” Id. (citation omitted) (quoting Hunt v. IBM Mid
Am. Emps. Fed. Credit Union, 384 N.W.2d 853, 858 (Minn. 1986)).
C
At least based on the arguments that the plaintiffs presented to the district court and
repeated to us, the district court correctly ruled against the plaintiffs and granted
the defendants’ motion to dismiss. We uphold the district court’s ruling for
substantially the reasons stated in its dismissal order. More specifically, the
defendants had a sound basis for invoking ADA preemption against the plaintiffs’
state-law claims. We are persuaded by the district court’s conclusion that an
Oklahoma state-law claim that requires a court to determine a reasonable price for
air-ambulance services self-evidently affects the price of those services. And,
thus, ordinarily the ADA would preempt such claims. Furthermore, the plaintiffs
have failed to make an adequate showing that the narrow Wolens exception for
16
claims relating to “voluntarily undertaken” contractual obligations applies to save
the plaintiffs’ claims from preemption. See Wolens, 513 U.S. at 222. Recall that
this exception applies to common-law contract doctrines but only insofar as the
doctrines serve “to effectuate the intentions of parties or to protect their
reasonable expectations,” rather than to protect “community standards of decency,
fairness, or reasonableness.” Ginsberg, 572 U.S. at 286 (first quoting Burton,
supra, at 371, then Universal Drilling Co., 271 P.3d at 999). But, based on the
plaintiffs’ arguments here, we cannot conclude that the Wolens exception applies. 9
9
In the district court, seeking to invoke the Wolens exception, the
plaintiffs cited Ginsberg and argued that “all Defendants have to do to ‘contract
around’ the rules relating to providing a missing price term is obvious: provide
the price term in the contract.” Aplts.’ App. at 140; see id. at 130 (“The
contractual analysis is common to all class members, and falls within Wolens’
exception since Defendants could ‘contract around those rules’ by supplying the
price term in their contracts.” (quoting Ginsberg, 572 U.S. at 288)). The
plaintiffs, however, have not pursued this argument on appeal; indeed,
remarkably, they do not even cite to Ginsberg in their appellate briefing.
Therefore, we are free to deem their contract-around argument abandoned (i.e.,
waived) and not consider it. See, e.g., Folks, 784 F.3d at 737; Yelloweagle, 643
F.3d at 1280–83. Even if we were inclined to reach the argument’s merits, we
note that the plaintiffs seemingly would face an insurmountable obstacle
because—as we discuss infra—the plaintiffs have failed to identify (before the
district court or us) Oklahoma legal doctrines from which we might conclude that
the missing price term in the parties’ contracts ordinarily would be filled with a
reasonable price term and that doing so would effectuate the parties’ contractual
intent. And, absent such a background principle of Oklahoma law, there would
not be anything that the defendants would have the need—much less the
incentive—to contract around by specifying a predetermined price for their
services. Cf. Aplts.’ App. at 268 (discussing “the inherent bargain at the heart of
every contract” and the plaintiffs’ seemingly questionable “assum[ption] the
parties still would have contracted had there been a predetermined price”).
17
As the district court suggested, the plaintiffs rely on concepts of fairness and
reasonableness. In doing so, they lament the absence of price terms in their
contracts with defendants and criticize defendants’ ultimate after-the-fact charges
for their services. Yet, as the district court aptly observed, such “notions [are]
found only outside the four corners of a contract.” Aplts.’ App. at 269.
Consequently, we are hard-pressed to see how they are calculated “to effectuate
the intentions of parties or to protect their reasonable expectations.” Ginsberg,
572 U.S. at 286 (quoting Burton, supra, at 371). And, more specifically, the
plaintiffs have failed to explain how imposing reasonable price terms under
Oklahoma law would help to accomplish these ends. 10
Notably, the plaintiffs failed to direct the district court or us to any Oklahoma legal
doctrines from which we might have possibly concluded that the missing price
term in the parties’ contracts should be filled with a reasonable price term and
that, doing so, would be deemed to effectuate the parties’ contractual intent.
Oklahoma law does appear to have authorities that at least arguably concern such
10
Like the district court in this case, we have previously recognized
that ADA preemption may sometimes produce harsh results for potential plaintiffs
seeking redress for perceived unfair treatment by air-ambulance carriers. See
Cox, 868 F.3d at 906–07. Yet, we felt constrained to observe that “[s]uch policy
considerations . . . are beyond the purview of [the courts]” and “must be
addressed to Congress.” Id.; see also Ferrell v. Air EVAC EMS, Inc., --- F.3d ----,
No. 17-2554, 2018 WL 3886688, at *3 (8th Cir. Aug. 16, 2018) (“We may not
refuse to apply ADA preemption merely because we do not believe it would be
sound public policy to enforce the statute Congress enacted.”).
18
matters. See, e.g., O KLA . S TAT . A NN . tit. 15, § 112 (“When a contract does not
determine the amount of the consideration, nor the method by which it is to be
ascertained . . . the consideration must be as much money as the object of the
contract is reasonably worth.”); accord Braden Winch Co. v. Surface Equip. Co.,
165 P.2d 640, 643 (Okla. 1945); see Mirzaie v. Smith Cogneration, Inc., 962 P.2d
678, 681 (Okla. Civ. App. 1998) (“According to § 112, it is only when the amount
of consideration is unspecified in the contract, or left to the discretion of an
interested party, that the statute applies.”); see also O KLA . S TAT . A NN . tit. 15, §
152 (requiring Oklahoma courts to interpret contracts so “as to give effect to the
mutual intention of the parties”).
But, at no point did the plaintiffs identify those authorities (or any similar ones) to the
district court or to us—much less make meaningful arguments applying such
authorities to these facts. 11 Given that we have
11
The plaintiffs filed supplemental authorities with our Court pursuant
to Federal Rule of Appellate Procedure 28(j) on January 15 and March 29, 2018.
These submissions do adumbrate some of the possible contours of such
meaningful arguments against ADA preemption. For example, in their January 15
submission, the plaintiffs included an opinion from the federal district court in
Montana that denied the motion to dismiss of defendants, air-ambulance carriers;
the court appeared to find facially plausible the plaintiffs’ allegation that
“Defendants knowingly incorporated a consideration term of ‘reasonable worth’
by their self-imposed and voluntary undertaking to omit a specific consideration
term.” Wagner v. Summit Air Ambulance, LLC, No. CR-17-57-BU-BMM, 2017
WL 4855391, at *5 (D. Mont. Oct. 26, 2017). And, in their March 29 submission,
the plaintiffs submitted a brief filed by the United States, as an intervenor in
litigation between private individual plaintiffs and defendant air-ambulance
(continued...)
19
consistently deemed it improper to “assume the role of advocate for [a] pro se
litigant,” Hall v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991); see, e.g., Garrett
11
(...continued)
carriers, in which the United States purported to inform the federal district court
in Colorado of “the correct analysis for determining whether plaintiffs’ claims are
preempted” by the ADA. Pls.’-Aplts.’ Notice of Supp. Authority, Ex. 1, at 12
(Intervention Mem. of U.S., dated Feb. 28, 2018) (bold-face font and initial
capitals omitted). In this connection, the United States opined: “[B]ecause typical
state contract law permits the parties ‘to contract around’ the court’s
determination of a reasonable essential term simply by executing an express
contract specifying that term, the state-law rule that the court supplies missing
essential terms ordinarily would not be preempted by the ADA.” Id. at 17. This
supplemental authority does not avail the plaintiffs, however, for two salient
reasons. First, a Rule 28(j) letter is not a proper vehicle for raising for the first
time new arguments on appeal (which do not otherwise appear in a party’s
appellate briefing). See United States v. Kimler, 335 F.3d 1132, 1138 n.6 (10th
Cir. 2003) (declining to consider a party’s argument presented “for the first time
in a supplemental authority letter pursuant to Rule 28(j)”); see also United States
v. Lindsey, 389 F.3d 1334, 1335 n.1 (10th Cir. 2004) (refusing “to consider” the
defendant’s argument “belatedly challenging his criminal sentence” through a
Rule 28(j) filing, and noting with reference to Kimler, that “[w]e have also
previously refused to consider an issue asserted for the first time in a Rule 28(j)
letter”). Therefore, even assuming arguendo that the plaintiffs’ supplemental
Rule 28(j) submissions offer helpful clues to arguments that could have helped
the plaintiffs to meaningfully respond to the defendants’ preemption defense, but
cf. Scarlett v. Air Methods Corp., No. 16-cv-02723-RBJ, 2018 WL 2322075, at *9
(D. Colo. May 22, 2018) (distinguishing Wagner and “find[ing] that the only
agreement that could plausibly be discerned from these facts is one that the Court
would impose as an equitable remedy, and . . . that any breach of contract claim
based on this implied-in-law contract is per se preempted by the ADA,” and
noting further that “[t]he Wolens exception does not fit this situation”), we would
still decline to consider such arguments. Second, were we to consider the merits
of the supplemental-authority submissions, they still would not rectify the
plaintiffs’ failure to identify pertinent Oklahoma authorities from which they
might possibly argue that the missing price term in the parties’ contracts should
be filled with a reasonable price term and that, doing so, would be deemed to
effectuate the parties’ contractual intent. Instead of Oklahoma, the supplemental
authorities implicate the laws of Montana and Colorado.
20
v. Selby Connor Maddux & Janer, 425 F.3d 836, 840 (10th Cir. 2005) (noting that
“the court cannot take on the responsibility of serving as the [pro se] litigant’s
attorney in constructing arguments and searching the record”), we certainly will
not adopt the function of advocate and “manufacture” arguments for parties, like
the plaintiffs, who are represented by counsel, Eateries, Inc. v. J.R. Simplot Co.,
346 F.3d 1225, 1232 (10th Cir. 2003) (quoting Sil–Flo, Inc. v. SFHC, Inc., 917
F.2d 1507, 1513 (10th Cir. 1990)). Therefore, we deem any arguments that the
plaintiffs might have made based on O KLA . S TAT . A NN . tit. 15, § 112 (or related
Oklahoma authorities) forfeited before the district court and waived here. See,
e.g., Havens v. Colorado Dep’t of Corrs., 897 F.3d 1250, 1259 (10th Cir. 2018)
(“We conclude that Mr. Havens has forfeited the argument that Title II validly
abrogates sovereign immunity as to his claim by failing to raise this argument
before the district court, and he has effectively waived the argument on appeal by
not arguing under the rubric of plain error.”); Bronson v. Swensen, 500 F.3d 1099,
1104 (10th Cir. 2007) (“[W]e routinely have declined to consider arguments that
are not raised, or are inadequately presented, in an appellant’s opening brief.”).
Based on the arguments the plaintiffs advanced before the district court and
repeated to us on appeal, we cannot reach any other conclusion than the one the
district court did: the ADA preempts all of the plaintiffs’ claims. 12
12
We have no occasion here to definitively opine on whether any
(continued...)
21
III
The plaintiffs argue that the defendants are estopped from claiming preemption because
the defendants sought to collect money owed by the plaintiffs under their
contracts in state court. More specifically, they allege (without record citations)
that the defendants previously argued the contracts were valid and enforceable
with a price term to be imposed by the courts.
Under the doctrine of judicial estoppel,
[W]here a party assumes a certain position in a legal proceeding,
and succeeds in maintaining that position, he may not thereafter,
simply because his interests have changed, assume a contrary
position, especially if it be to the prejudice of the party who has
acquiesced in the position formerly taken by him.
New Hampshire v. Maine, 532 U.S. 742, 749 (2001) (alteration in original) (quoting Davis v.
Wakelee, 156 U.S. 680, 689 (1895)). “Judicial estoppel is a doctrine designed ‘to
protect the integrity of the judicial process by prohibiting parties from
deliberately changing positions according to the exigencies of the moment.’”
Kaiser v. Bowlen, 455 F.3d 1197, 1203 (10th Cir. 2006) (quoting New Hampshire,
532 U.S. at 749–50).
12
(...continued)
Oklahoma laws that would permit missing price terms in contracts to be filled by
reasonable price terms would be categorically preempted under the ADA or,
instead, fall within the Wolens exception to such preemption. We rest our
decision solely on the arguments that the plaintiffs elected to present before the
district court and to us.
22
We conclude that the plaintiffs’ “skeletal” judicial-estoppel arguments, however, are
waived. United States v. Pursley, 577 F.3d 1204, 1231 n.17 (10th Cir. 2009). In
their briefs on appeal, the plaintiffs have not presented a single citation to a
relevant state-court case where the defendants allegedly took a contradictory
position, nor have they identified specific arguments raised by the defendants in
prior judicial proceedings that contradict arguments raised before the district
court here. The plaintiffs’ failure to adequately support their judicial-estoppel
argument effectively waives our review of it. See United States v. Cooper, 654
F.3d 1104, 1128 (10th Cir. 2011) (“It is well-settled that ‘[a]rguments
inadequately briefed in the opening brief are waived.’” (alteration in original)
(quoting Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 679 (10th Cir. 1998))).
IV
For the foregoing reasons, we AFFIRM the judgment of the district court.
ENTERED FOR THE COURT
Jerome A. Holmes
Circuit Judge
23