Did US (HP) acquire AMR, was it a merger or what ?

[nbmcg01]

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eolesen, on 06 April 2013 - 07:08 PM, said:[/background][background=rgb(252, 252, 252)]

Perhaps some people think an acquisition implies stapling?[/background]
Then they better start being nervous. What just happened to AA qualifies according to the NMB.

 

[AANOTOK]

[background=rgb(242, 242, 242)]eolesen, on 06 April 2013 - 07:08 PM, said:[/background]

[background=rgb(252, 252, 252)]Perhaps some people think an acquisition implies stapling?[/background]
Then they better start being nervous. What just happened to AA qualifies according to the NMB.

AA employee...not nervous

 

[FWAAA]

Here you go again perpetuating this falsehood.

The legal definition of a merger according to the CAB and the McCaskill-Bond amendment is as follows:

"The term 'merger' as used herein means to join action by the two carriers whereby the unify, consolidate, merge, or pool in whole or in part their separate airline facilities or any of the operations or services previously performed by them through such separate facilities."​

Falsehood? Nope. Sorry. There's nothing false in the paragraph you quoted. AA purchased certain assets of TWA and expressly assumed certain liabilities. There was no merger. Mergers are defined by state corporate laws, and the TWA asset purchase doesn't fit the definition of "merger" under state corporate laws.

In your poorly argued attempt to classify the TWA asset purchase as a "merger," you cite to two irrelevant definitions. We don't know whether the CAB would have defined the TWA asset purchase as a merger, as the CAB was out of business by 1985, 16 years before AA would buy the TWA asssets. Allegheny merged with Mowhawk - it wasn't an asset purchase.

In your second irrelevant citation, you mention the McCaskill-Bond amendment, where the Senators from Missouri responded to the pleas from the former TWA employees to do something in hopes of preventing another staple in subsequent airline combinations. Assuming that McCaskill-Bond would apply if an airline purchased assets in a TWA-style asset acquistion, that doesn't make the TWA asset purchase a "merger." Under M-B, it won't matter whether the combination is a merger or an asset purchase, but that doesn't change the character of the 2001 transaction by which AA purchased assets.

You are attempting to characterise the TWA asset purchase as a merger by pointing to the CAB and M-B when in reality, whether the TWA asset purchase was a merger or not is defined by state corporate law in 2001. In 2001, the TWA asset purchase was not a merger. Neither the 1972 decision of the CAB in a true merger case or the M-B amendment passed by Congress in 2008 changes the facts.

Calling the TWA asset purchase a "merger" when it clearly was not is a classic example of revisionist history. As I pointed out the other day, the TWA asset purchase resembled a merger in many ways. TWA continued uninterrupted operations as an airline (TWA LLC) until those operations were combined with AA's operations. AA assumed most of the liabilities of TWA (but not all of them).

Regardless of your opinion about what happened to the former TWA employees, AA bought assets - the TWA transaction was not a merger.

 

[cltrat]

AA employee...not nervous

AANOTOK my friend I can tell you this much I have never heard not one of my coworkers here in fleet at US ever so much as suggest they wanted anyone at AA's seniority, we don't want to give any of ours though.
Hopefully we will all get thru this train wreck of a merger , straight DOH is fine by me

 

[AANOTOK]

My response was to nbmcq01's "better start getting nervous" comment.
I also think DOH is the only fair way to go.

 

[Bob Owens]

AA employee...not nervous

Same here.

 

[Veritas]

Falsehood? Nope. Sorry. There's nothing false in the paragraph you quoted. AA purchased certain assets of TWA and expressly assumed certain liabilities.

Keep digging your hole. Just because the CAB was dismantled and its functions taken over by other agencies did not invalidate its rulings. The merger definition in the Allegheny-Mohawk case was not limited to that case. As the lawyer that you are, you know that this ruling held precedent for all future airline combinations.

Calling the TWA asset purchase a "merger" when it clearly was not is a classic example of revisionist history. As I pointed out the other day, the TWA asset purchase resembled a merger in many ways. TWA continued uninterrupted operations as an airline (TWA LLC) until those operations were combined with AA's operations. AA assumed most of the liabilities of TWA (but not all of them).

You are just proving the point that TWA merged with AA. TWA's operations continued uninterrupted until they were merged with AA's. The transaction was structured as an "assets purchase" in order to get rid of Carl Icahn's onerous Karabu ticket agreement. Karabu was the reason that AMR required TWA to file for bankruptcy as a condition of the merger agreement. In every other respect this was a merger. If it looks like a duck, swims like a duck, and quacks like a duck, then it is a duck.

 

[eolesen]

V, I don't disagree with the appearance part, but there's still some precedent for what AA did which didn't involve AL-MO.

Prior to deregulation, there were few if any comparable asset transactions for the CAB to act on --- the transfer of AOA from AA to PA is probably the closest, and that was a subsidiary so there was no mixing of employees involved. It was also in the 1950's, and predated AL-MO.

Braniff's sale of its EA routes to MIA was done while the CAB was still around, but didn't involve any US employees, so there was no jurisdiction for them to rule.

In the previous asset purchases that AA engaged in ---- TW's LHR routes, and EA's LatAm routes, it was also a continuous operation. Nobody from TW or EA in the US got DOH. They didn't even get jobs.

In the transactions which involved PA for UA and DL, again, it was continuous operations until the handover. The few employees who came along from PA to DL were not taken in seniority order, and I don't recall any employees coming over to UA. The pilots at PA had to work with ALPA on dovetailing. Since everyone else was non-union, there was no need to arbitrate anything...

Overseas, the ground employees got their company seniority, but the FA's who came along with the EA transaction were and still are treated as second-class citizens to the APFA.

 

[ThirdSeatHero]

V, I don't disagree with the appearance part, but there's still some precedent for what AA did which didn't involve AL-MO.

Prior to deregulation, there were few if any comparable asset transactions for the CAB to act on --- the transfer of AOA from AA to PA is probably the closest, and that was a subsidiary so there was no mixing of employees involved. It was also in the 1950's, and predated AL-MO.

Braniff's sale of its EA routes to MIA was done while the CAB was still around, but didn't involve any US employees, so there was no jurisdiction for them to rule.

In the previous asset purchases that AA engaged in ---- TW's LHR routes, and EA's LatAm routes, it was also a continuous operation. Nobody from TW or EA in the US got DOH. They didn't even get jobs.

In the transactions which involved PA for UA and DL, again, it was continuous operations until the handover. The few employees who came along from PA to DL were not taken in seniority order, and I don't recall any employees coming over to UA. The pilots at PA had to work with ALPA on dovetailing. Since everyone else was non-union, there was no need to arbitrate anything...

Overseas, the ground employees got their company seniority, but the FA's who came along with the EA transaction were and still are treated as second-class citizens to the APFA.

UA did get some of the Pan Am flight crews with the route transactions.

IIRC PA wanted DOH and UAL wanted a staple job, it ended up going to arbitration and ended up somewhere in between.

 

[ThirdSeatHero]

Addition - the first group of pilots brought on with the Pacific routes came to agreement on integration outside of arbitration.

The pilots brought on with the London routes ended up going to arbitration.

 

[eolesen]

Thanks for clarifying. It's been 22 years...