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August 30, 2012

APA says judge should consider more evidence at Tuesday hearing

The pilots union said the bankruptcy judge should look at more than just furlough policies and code-sharing agreements at a hearing on the pilots' contract scheduled for Tuesday.

The argument that the court should consider more evidence was made by the Allied Pilots Association in a filing on Thursday. The APA was responding to American Airlines' request that the bankruptcy judge only consider the two areas where the judge deemed the carrier overstepped in its term sheets.

"To the extent that the Company’s August 16 proposal re-promulgates old Term Sheet demands from the first Section 1113 proceeding, the Court’s inquiry should focus on whether any of the facts the Court relied on in its first Decision have changed so as to warrant a different conclusion with respect to particular modifications sought in the Company’s New Application. Toward that end, APA will identify critical changes in the Company’s business strategy and labor concession targets, as well as significant developments in the industry, between May 25, 2012 and August 17, 2012, the filing date of American’s New Application. Those changes require updated analysis in the context of American’s New Application," the APA filing said.

American has asked the court to reject its pilots contract and allow it to impose concessionary work rules that are necessary for the company to restructure while in bankruptcy. On August 15, the judge ruled that American could not reject its pilot contract because it did not prove it was necessary to expand codesharing with other domestic airlines and change pilot furlough protections as part of its restructuring plan.

“Our focus right now is on moving forward with the process clearly delineated in Judge Lane’s decision, in which he identified only two areas – pilot furlough protection and codesharing – that needed to be modified before renewing our 1113 motion. Our revised term sheet withdrew the company’s prior proposal to change pilot furlough protections, leaving the current contract terms in place, and proposed substantially less codesharing," said American spokesman Bruce Hicks.

He added, “we maintain that the changes outlined in our term sheet are necessary for our successful restructuring, and will help us reach our goal toward emerging as a stronger company. If the Court approves the rejection of the contract, we will begin to implement the terms from the term sheet that will enable us to achieve our necessary cost savings and continue moving forward toward a successful restructuring.”

-Andrea Ahles

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Comments

Kate

What more does the judge need to see? He told AA and the APA the parts of the term sheet that he found problematic and told AA to revise these sections. AA did just that and now the judge will weigh in in the revisions. The judge was very clear that he accepted AA's arguments and dismissed the APA's counter arguments.

Why is this so hard for the APA to understand? Seriously, the pilots voted down their offer and now the consequences will kick in. There is no mystery as to what would happen if the agreement was declined. It's time for the pilots to man up. Seriously, they made their bed so now they must lie in it. Sympathy from the court my foot!

DG

We all had the chance to vote on LBO's from the company. Most groups opted to accept these offers and therefore will not have the term sheets imposed. We all knew that if we did not ratify these LBO's, the judge would issue his ruling on the terms sheets and we would surely be on the losing end.

What I would like to know is why the APA thinks they are more special than other work groups? Why does the APA think that they should be the exception to the rule? Why should pilots be given special consideration after the fact? Why is the APA trying to change the rules of the game after the fact?

We all knew what the stakes were. It was a tough vote that made all of us look in the mirror, dig deep into our hearts, and make a decision that would probably hurt. But the majority of us voted for our LBO's because we were fully aware of the consequences. The pilots declined their offer. This was their decision and now they must face the music, just as other groups would have had to do if they had voted against their offers. I have nothing against the APA or pilots, but the games have got to end. And if the judge does say he will rethink the term sheets, where does that leave the rest of us?

casual observer

This is a last ditch effort by the APA to save face. The judge knows this and will most likely tell the good union to go pound sand.

SickyTooth

Not all pilots voted this down! The junior pilots are the ones who are screwed! 61/39 split. That says that 39% are intelligent enough to accept the LBFO. You have to remember, this group is highly qualified to move aircraft around safely. Unlike the other groups, they are professionals much like doctors and lawyers. No big babies like the media suggests!

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