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April 02, 2012

American's Section 1113 hearing set for April 23

The bankruptcy court has scheduled an April 23 hearing for American Airlines' motion to reject its union contracts under Section 1113 of the bankruptcy code.

In a filing made Monday afternoon, the court said opening statements will begin on the 23rd and that American's case will continue day to day, subject to the court's schedule until it has been completed. Two weeks after American completes its case, the unions will be able to present their case in the matter.

After the unions state their case, the court will allow the Pension Benefit Guaranty Corp and the Unsecured Creditor's committee to respond. American will then be allowed a rebuttal.

Under Section 1113 of the U.S. Bankruptcy Code, companies can ask the judge to change collective bargaining agreements and request contract changes that are "fair and equitable" to all stakeholders.

-Andrea Ahles


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