This is why a DAL merger won't happen.

[traderjake]

Our "profession" was destroyed by deregulation.

Guys like you give mangement the tools to do it when you negotiated the B scale and conceded the job could be done for less.

You threw the junior guys under the bus and now you can't understand why we won't march to the edge of the cliff with you.

This is and always has been just "a job" for some us.

 

[PITbull]

Thanks for saving our airline!

The difference between you and me is precisely what you have articulated. I was willing to take the chance and see U go by the wayside because the profession is infinitely more important than a company. You don't see it that way. You never will. I also had the financial ability to make that choice. Simply because I saw BNF, EAL, and the rest fail. I was prepared. You were not. Shame on you.

But you have some audacity to think this pilot group "saved" U. Pilots fly airplanes. The do not run companies. LUV pilots make 40% more than you do and you think the U pay cuts and pension giveback saved the airline? Even as CAL recently made a substantial pension deposit to its pilot plan and AMR also did so a few months back. Parker can thank you for his millions. As our retired and soon to be retired get squat. Saved the airline? Jeeez!

Your 57% didn't save the airline. You destroyed the profession.

But hey, at least you still have a "job". After all, what else do you know how to do other than fly airplanes.

pilot

CO made a pension contribution as well.

 

[bigbusdrvr]

Thanks for saving our airline!

The difference between you and me is precisely what you have articulated. I was willing to take the chance and see U go by the wayside because the profession is infinitely more important than a company. You don't see it that way. You never will. I also had the financial ability to make that choice. Simply because I saw BNF, EAL, and the rest fail. I was prepared. You were not. Shame on you.

But you have some audacity to think this pilot group "saved" U. Pilots fly airplanes. The do not run companies. LUV pilots make 40% more than you do and you think the U pay cuts and pension giveback saved the airline? Even as CAL recently made a substantial pension deposit to its pilot plan and AMR also did so a few months back. Parker can thank you for his millions. As our retired and soon to be retired get squat. Saved the airline? Jeeez!

Your 57% didn't save the airline. You destroyed the profession.

But hey, at least you still have a "job". After all, what else do you know how to do other than fly airplanes.

pilot

---------------------------------------------------------

First off...the pilots didnt save USAIRways, the entire employee group did.

The pilots made the most, so they gave the most, dollar for dollar....

The pension issue is a grab bag now that some legacies have one and some dont...If the market is up, no contributions from a carrier with a defined benifit plan,..if the market is down....posible large mandatory contributions....
With a definrd contribution plan, ala USAIRways,management will always be obligated to a known amount.....
This can help or be a hindrance to the corporation.

Parker can definatelly thank me for his millions, so can the rest of the shareholders....USAIRways wouldnt be showing a profit ow if not for the employees givebacks....

However, as right as you are that the USAIRways pilots sold the proffesion down the river, I believe the river was the only place for us at the time and sircumstance we were in...jusy mt opinion, so you can count me in with the 57%

By the way, my father lost his pension as well in Delta's reorgination, so it wasnt just the USAIRways pilots seeing the light at the end of the tunel.

We've all seen some trying times...Some see stability in the evental "Three carriers" . I believe some want to get in on the first dance, Delta is a pretty good airline.
I think some, myself included want to survive, not at the detriment of others mind you, but to just se some stability in this industry...for a short time at least!!

You are a very gallant individual to make a stand for the profession and not "Cow down to this level"...I comend and respect you for not lowering yourself to that level...

By the way...Where do you work now....

 

[flyhigh]

It seems to me that if the creditors are told by Bethune that the merger is their best bet and all but ALPA on the creditors committee vote for it, they would be compelled to change their contract. Mgmt would be forced to begin to negotiate with ALPA. If ALPA refuses to budge, the company would be compelled to file the 1113. If I recall correctly, ALPA then has to negotiate. Let's assume they get a contract chage shoved at them. Didn't NW's proceedings set the precedent for job actions on this issue. I believe their FA's were barred from a job action. So, with said, wouldn't the union be better of negotiating for the best possible contract the allows the merger but protect the lifestyle aspects most.

 

[john john]

DL took their shot at the 1113C process early in their BK. Not that they couldn't possibly take another shot at it, but how many times has a BK judge overturned his earlier ruling?

Jim

Jim is there a loophole
summary of the DL ALPA T/A:

Bankruptcy Protection Covenant, ALPA Claim, and Notes



• The Bankruptcy Protection Covenant is an extensive legal document that
supersedes the LOA #46 Bankruptcy Protection Letter.
• The company cannot file another Section 1113 motion to reject the PWA during
this bankruptcy unless in imminent danger of losing its DIP financing and
satisfaction of other tests.• Legal protections for ALPA and its representatives.
• The company must propose and may only support a Plan of Reorganization
(POR) that contains the ALPA Notes, the ALPA Claim (equity), and other terms,
including assumption of the PWA as modified.
• If the company's POR does not comply with the ALPA terms, procedures are
established to return to the PWA in its entirety as it existed prior to LOA #50.
• $650 million note or cash (at company option) in consideration of contract
concessions if the DB plan terminates. MEC to determine allocation.
• $2.1 billion bankruptcy claim in consideration of contract concessions. In a
bankruptcy, a claim is usually paid in equity (stock in the reorganized company
when it exits bankruptcy). The value of equity resulting from a claim will depend
on the value of the company at exit from bankruptcy and the size of the total
claim pool. The value of the stock is usually much less than the nominal value of
the claim itself. For example, in the United Airlines bankruptcy, at the time of
exit from bankruptcy, the newly-issued United stock traded at about 24% of the
nominal value of the claim; today the stock is trading at about 16% of the nominal
value of the claim.
• The MEC may be able to decide that the notes, cash and equity described above
may be allocated to qualified retirement plans, up to Section 415© limits.



Recovery Compact



• Process established to repair and improve employee-management relations.

Delta’s Section 1113 © demands that were not achieved

• 19.5% pay cut with no pay raises
• Delete 401 (k) company contribution
• Five year duration
• Delete all furlough protections
• No financial returns
• $325 million concessions per year and no recognition of DB Plan termination
• 79-seat jet DCI aircraft
• Delete the change of control provisions
• Establish a sick leave reliability program and impose draconian sick leave terms
• Minutes under offset by minutes over
• 15 minute release per duty period
• No captain on relief crew for flights over 12 hours
• Change max scheduled duty time

 

[jimntx]

It does not matter, the Section 1113 C letters are worth nothing, US had one in the first bankruptcy after the first round of concessions and low and behold several months later US was back after concessions and got them.

Having been involved and through two bankruptcies and three rounds of concessions, we have lived it.

And you don't think DL can finagle the Lenders to suit their wants and needs from the Pilots?

By DL, who/what do you mean? If you mean the management of the company, I repeat, why would they want to? The DL pilot contract gives DL management, who do not want this merger, cover. Why ever would they eliminate something that stands in the way of a merger they don't want? Parker and company have no standing with the Bankruptcy Court, and so far they do not seem to have convinced anyone that it is in their (DL management or creditors) interest to pursue the merger, and go back to the court.

Bethune said it might be a good financial deal. He did NOT say that it was the BEST financial deal.

Parker has also said that the offer expires on 31JAN. It is now 16JAN. Oh, the days dwindle down, to a precious few.

 

[Gilding the Lily]

By DL, who/what do you mean? If you mean the management of the company, I repeat, why would they want to? The DL pilot contract gives DL management, who do not want this merger, cover. Why ever would they eliminate something that stands in the way of a merger they don't want? Parker and company have no standing with the Bankruptcy Court, and so far they do not seem to have convinced anyone that it is in their (DL management or creditors) interest to pursue the merger, and go back to the court.

There is another loophole! Stated this earlier, but just as pertinent here:

Pursuant to the letter of agreement, Delta has agreed to assume the PWA, as modified, as part of any plan of reorganization filed with the Court. Thus, until the POR is accepted and confirmed, the PWA has not been assumed by DL.

Therefore, it is possible that the PWA may be modified/amended before any plan is accepted and confirmed. Of course, it appears that DL ALPA will be reluctant to modify the PWA in a way that will allow US to succeed in a DL/US merge. However, ALPA's reluctance does not prevent an 1113 motion. As stated by 'John John' earlier, DL "cannot file another Section 1113 motion to reject the PWA during this bankruptcy unless in imminent danger of losing its DIP financing and satisfaction of other tests."

Thus, your 1st question, as 'jimntx' asked, is probably: "DL doesn't want a DL/US merger so why would DL ever think of attempting an 1113 motion that would give US a fighting chance of succeeding in a DL/US merge?"

So, here is the other loophole.

Well, it is not always necessary for the debtor (DL) to file the 1113 motion. In fact, the creditors' committee has standing to seek rejection of a collective bargaining agreement when rejection of the agreement is necessary for proper reorganization and the debtor isn't acting. The committee, unless I am mistaken, is not a party to the contract and, thus, not bound by the terms. This is a difficult standard to meet; but if the creditors' committee wants a DL/US merger, I think it may be able to find a way (educated speculation that is likely moot).

 

[ClueByFour]

Here is the problem. 1113 states, among other things:

a) the debtor must make a proposal to the union to modify the CBA that incorporates changes necessary to permit reorganization;

DALPA has a fine case that changes are not necessary to permit reorganization (see the DL standalone plan).

That, and they will (with the help of better paid lawyers than what NW FAs had) do everything possible to strike if that happens, which will decimate the value of the airline. This is more a risk for the creditors than LCC since LCC won't own it yet (maybe).

Doogie is going to have to deal with DAPLA. The court won't help.

 

[BoeingBoy]

The only objections to the amended PWA (LOA #51) that I've seen were from the retired pilots ("DP4") and the PBGC, both overruled when the judge approved the changes to the PWA. So effectively, all other parties with standing agreed that the PWA as amended was necessary for the reorganization.

Could another 1113 motion be filed - yes, as I've said before. But other than DP4 and PBGC, anyone filing it would have to explain it had become necessary to abrogate the very agreement they previously had no objections to.

Other than some event that threatened DL's very existence and would cause liquidation, I wouldn't want to be the lawyer trying to convince the judge that he need to overturn a previous ruling when I had no objections prior to that ruling.

There is another possible loophole, though it's existence depends on knowing more of the nuts and bolts of labor law than I know. It could be the reason that Parker said the new airline created would be called Delta.

Jim

 

[Gilding the Lily]

The only objections to the amended PWA (LOA #51) that I've seen were from the retired pilots ("DP4") and the PBGC, both overruled when the judge approved the changes to the PWA. So effectively, all other parties with standing agreed that the PWA as amended was necessary for the reorganization.

...

Other than some event that threatened DL's very existence and would cause liquidation, I wouldn't want to be the lawyer trying to convince the judge that he need to overturn a previous ruling when I had no objections prior to that ruling.

Jim

A decision under a newly filed 1113 motion would not "overturn" a previous decision of the court. The original 1113 motion was never decided because of the negotiations, arbitration, and eventual settlement, which resulted in LOA # 51 and Judicial order under sections 363, not section 1113. Nonetheless, as Jim mentioned, some explaining would still be required.

 

[BoeingBoy]

While what you say is true - the judge never ruled on the 1113c motion - he did issue an order approving LOA 51's amendments to the PWA. That is the order that would be overturned.

Jim

 

[Gilding the Lily]

While what you say is true - the judge never ruled on the 1113c motion - he did issue an order approving LOA 51's amendments to the PWA. That is the order that would be overturned.

Jim

Jim,

Semantics... that is what those lawyers (and judges) do best. The order you mention is the 363 order issued on June 2. Because the judge did not rule on the 1113 motion, but rather, issued an order based on 363, authorizing DL to enter into the terms of LOA # 51, the judge can safely rule on an 1113 motion without overturning the 363 order.

Judges do that all the time. It is two separate issues. The 363 issue ordered, in sum, that DL is authorized to enter the negotiated settlement (LOA # 51) and will be effective and enforceable.

Thus, because this 363 order allowed the debtor to enter into the agreement and made the agreement enforceable (just like all other contracts in 363), the judge would not be overturning the decision if he decided that DL (or creditors' committee) is able to reject the CBA because the issues under rejecting a CBA under 1113 revolve around different issues than a 363 order authorizing DL to modify the PWA. (See 1113 for all the different issues involved).

Simply put... allowing DL (or creditor's committee) to reject a CBA does not negate the judge's earlier decision simply giving "authorization" to DL to enter into a negotiated settlement. A new order uner 1113 would not change the fact that DL was authorized to enter into that negotiaited settlement... that authorization would just be null because the CBA is rejected under a completely different section. Also, section 1113 built in a section that deals with changing circumstances, such as other bids, that may lead DL (or creditor's committee) to attempt a rejection of the CBA after something like this: Prior to filing an application seeking rejection of a collective bargaining agreement, the debtor shall make a proposal based on the most complete and reliable information available at the time of such proposal, which provides for those necessary modifications in the employees benefits and protections that are necessary to permit the reorganization of the debtor....

Because the issue was never resolved in an 1113 order, DL (or creditors' committee) may complete those same steps and ask for rejection without even asking the court to overturn the 363 decision.

Further, because the PWA has not been assumed as of yet (actually said to not be assumed in the order), it may be done away without overturning the 363 order.

 

[Breath_of_Fresh_USAirways]

...That, and they will (with the help of better paid lawyers than what NW FAs had) do everything possible to strike if that happens, which will decimate the value of the airline. This is more a risk for the creditors than LCC since LCC won't own it yet (maybe).

I'm curious. What would the timeline of such a strike be; I mean, after a merger is agreed to (other than DALPA), or before? Could the "merger deal" be contigient on the pilots not striking?

If the pilots strike and de-value Delta Airlines, wouldn't that make it more attractive (especially to the creditors) to sell DL off in pieces? (Don't have to take the PO'd pilots that way...) Then USA could pick and choose the pieces they want (or get into a bidding war with AA or UA or whomever...) and not have to wait for the DOJ???

Not saying any of this will happen -- just asking questions out loud...and wondering about all the possibilities...

 

[BoeingBoy]

As you say, semantics and technicalities.

DL management argued in their motion, and all creditors except DP4 and the PBGC tacitly agreed, that approval of LOA 51 was necessary for the successful reorganization of DL. Stemming from that, several other things were approved by the judge - DALPA's unsecured claim and notes, DP4's unsecured claim, etc.

In filing a motion under 1113, someone would have to argue that they, in effect, changed their mind and that LOA 51 was now an impediment to the successful reorganization of DL and that the DALPA PWA must be abrogated.

Barring a situation that made liquidation likely, I wouldn't want to be the one arguing that. Do you know of any BK case where such an argument has been attempted, much less successful, without the agreement of both parties concerned?

Jim

[add]

You'll note that I've never said it can't be done, only that it's unlikely. Pretty much the same as you've said, I believe.

Besides, if anyone thinks that DALPA is anti-US/DL merger now just wait till someone tries to throw out their contract to facilite the merger.....

 

[Gilding the Lily]

Do you know of any BK case where such an argument has been attempted, much less successful, without the agreement of both parties concerned?

Jim

Jim,

Good question. Yes I do know of such arguments.

This is almost the exact type of strategy that was often done in the steel industry in the 80's. The United Steel Workers union would make concessions and Debtors would offer preferred stock or some other equity in return. After several concessions before bankruptcy, and several negotiated settlements and concessions after the bankruptcy petition, the Debtor's would then file an 1113 motion to reject the CBA.

The debtors sometimes were succesful, and sometimes not. There is usually a 9-step process that the judges use to determine the success of the motion, concluding with the Court balancing the equities. Honestly though, it is very messy and hotly contested. And yes, often the potential liquidation scenario is a factor in the analysis.