Category Archives: Breaking News

United Airlines BOD Approves Deal With Continental Airlines

As expected, news reports this afternoon say that the board of directors of United Airlines has okayed a merger with Continental Airlines. The Continental BOD is expected to meet later today and do the same.

The expected merger is valued at more than $3 billion and the formal announcement is expected Monday.

For now, my lips are sealed. I’m in the middle of writing another 100 page earnings issue of PlaneBusiness Banter. But I will say this — I hope the folks at Continental did their homework.

Goodbye Houston, hello Chicago.

Hot Off the Rumor Mill: US Airways Set To Make Formal Offer for United Airlines

For what it’s worth, we’ve been hit by a number of emails in the last hour concerning a possible announcement regarding a move by US Airways on United Airlines.

While this would certainly be big news, for those of you who follow the industry (and hopefully by reading PlaneBusiness Banter), you shouldn’t be surprised.

Yee haw. I hope these rumors are spot on. I’m tired of reading emails about diaper bags and charging for carryons.

Air France Flight Declares “Mayday” Over Atlantic Because of Severe Turbulence

Scary news just posted on The Aviation Herald website. Simon reports that an Airbus A330-220 was flying from Rio de Janeiro to Charles de Gaulle in Paris when the crew issued a Mayday alert on the international emergency frequency, indicating the aircraft had encountered severe turbulence over the Atlantic.

According to Simon, “The Mayday call was relayed by the crew of a TAM Airbus A330-200.”

This aircraft appears to be AF Flight 445 GIG-CDG and the route the aircraft was following is very close to that which AF Flight 447 was on when it disappeared.

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Thanks much to PBB subscriber Brian Rynott for this head’s up.

FAA Proposes $5.4 Million Civil Penalty Against US Airways; $3.8 Million Against United Airlines

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Hark! Today there is news of two proposed FAA penalties — and the news does not involve an airline based in the Dallas area.

Today the FAA announced that it has assessed a proposed civil penalty of $5.4 million against US Airways, and a proposed civil penalty of $3.8 million against United Airlines.

in the case of US Airways, the FAA said in a statement that the airline allegedly operated eight aircraft while out of compliance with safety directives or its own maintenance program.

In a letter to employees issued just a few minutes ago, US Airways COO Robert Isom wrote,

“It is important to remember that today’s announcement references situations that are in the past, and in several cases, date back to two years ago. This isn’t to make light of the findings or our corrections to those findings, rather it’s to say these occurrences are behind us, and today, we have improved upon an already solid maintenance program.

The FAA proposed civil penalty dates back to challenges we faced related to our America West/US Airways maintenance integration in 2007. The integration presented some challenges in the areas of inspection and records during 2007, 2008 and early 2009. Our team has worked cooperatively with the FAA to investigate and correct any discrepancies to the FAA’s satisfaction.

More specifically, over the past nine months, we and the FAA have completed a formal review of our aircraft maintenance tracking systems as well as a comprehensive review of our maintenance program. This collaborative process included efforts to identify the issues, drill down to find the root cause and develop comprehensive fixes.”

However, In the case of United Airlines, the FAA alleges that the airline flew one Boeing 737 aircraft on more than 200 flights after “violating its own maintenance procedures.” That’s the “official” language. In plain language, the airline apparently continued to fly a plane that had shop towels stuffed in the aircraft’s engine.

On April 28. 2008, a United 737 returned to Denver after shutting down an engine due to low oil pressure indications. During teardown of the engine a week later, United mechanics found that two shop towels, instead of protective caps, had been used to cover openings in the oil sump area when maintenance was done in December 2007. As a result of United’s failure to follow its maintenance procedures, between February 10 and April 28, 2008, the airline continued to fly the airplane on more than 200 revenue flights when it was not in an airworthy condition.

Wonderful. Shop towels?

As is the case with all proposed FAA fines, each airline will have 30 days in which to appeal the proposed fines. In the past, this would then be followed by a little horsetrading between the airlines and the FAA — in an attempt to lower the fine amounts.

Will be interesting to see how much these fines are reduced. Especially the United one. While the US Airways’ transgressions seems to be based on issues involving proper record keeping of the newly merged airline — the shop towel incident with United strikes me as a much more serious “safety” issue.



Kate Hanni Files Suit Against Delta Air Lines and Metron Aviation: Accuses Delta Air Lines Of Hacking Her Email Account

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Man oh man.

Some days you just couldn’t do a better job of making up a blockbuster story if, well, you made it up.

Today is definitely one of those days.

According to a complaint filed in U.S. District Court for the Southern District of Texas, Kate Hanni — the woman who has been at the forefront of the move to get a passengers’ bill of rights passed on Capitol Hill, claims that Delta Air Lines hacked her email accounts, in addition to personal files on her computer.

What the hell you say? I know. When I read the headlines I was skeptical too. But that was before I read the formal complaint filed by Hanni’s attorneys and the accompanying exhibits.

You too can do the same. You can access the complaint here, and the exhibits document here.

Here’s the Cliff Notes version.

Hanni, who is the executive director of the Coalition for an Airline Passengers’ Bill of Rights had her AOL email account hacked into. In addition, the attack was apparently done using some type of malicious little code that also copied files from her personal computer. According to Hanni’s complaint, “Specifically, private e-mails and sensitive files were obtained by Delta Air Lines, Inc. (“Delta”) and subsequently used to sabotage Flyersrights’ efforts to pass the “Airline Passenger’s Bill of Rights of 2009” through Congress.”

Here is the meaty stuff from the complaint:

“11. Beginning in February 2009, Hanni exchanged information with Frederick J. Foreman, PhD (“Foreman”), an MIT graduate working for Metron Aviation, Inc. (“Metron”). Foreman was hired by the FAA to analyze airline surface delays. During their correspondence, Foreman, with explicit permission from Metron, updated Hanni with public information and statistics from his research and analysis. Hanni, in return, provided Foreman with data and information she acquired about surface delays. In his final report, Foreman pinpoints Delta as an airline experiencing excessive surface delays.

12. During the time Hanni was sharing information with Foreman, Hanni’s personal computer files and Flyersrights e-mail accounts were hacked. America Online (“AOL”), Hanni’s e-mail service provider, confirmed the e-mail accounts were hacked. As a result of the hacking, spreadsheets, lists of donors, e-mails, Department of Transportation statistics and Hanni’s personal files were redirected to an unknown location. Additionally, all of the information on Hanni’s personal laptop was corrupted and rendered useless.

13. On September 25, 2009, Metron executives confronted Foreman with the stolen e- mails and claimed Delta, a client of Metron, was angry about Hanni getting information that would help pass the Airline Passenger Bill of Rights.3 Metron had the stolen e-mails and files from AOL and Hanni’s personal computer in its possession.

14. When Foreman asked Metron how Metron obtained the information, Metron claimed that Delta had provided them with the stolen e-mails.4 Confirming Metron’s claims, the screenshots of the stolen e-mails presented to Foreman were from Delta. Foreman was fired by Metron the same day.”   

Holy crap.

All I can say is read the exhibits, particularly the statement from Mr. Foreman. Pretty damning stuff if you ask me.  

Can’t wait for this one to unfold.

Hanni is asking for $1 million in actual damages and $10 million in punitive damages. More importantly, she wants to know how her personal files and emails were obtained by the Delta Air Lines and Metron.

I want to know too.

Southwest and SWAPA Have Another Tentative Agreement in Hand

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Hey, I could be talking about the push to get a passenger rights bill passed.

No, I really didn’t plan for today to be the Southwest AIrlines news day.

But this afternoon SWAPA, the pilot’s union at Southwest, announced a new tentative agreement with the company. This will be the second attempt by both sides at getting a new contract ratified.

Highlights of the contract behind door number two are:

The current number of Lance Captains, as of the ratification date, will be grandfathered for the term of the agreement. (This was a big reason the attempt to ratify the last last TA failed.)

ELITT restrictions will drop from previous TA and is now contractual.

The new Open Time system as explained in the previous TA will now have a test period (circuit breaker) in which SWAPA can opt out.

In terms of compensation, the new agreement includes raises and full retro pay.

There is an increase in 401(k) matching by the company.

And on the subject of codesharing, the TA lowers the previously negotiated near-international ASM cap, and it removes Frontier-specific RJ exemption language.

Latest SWAPA Update on Pilot Negotiations Regarding Southwest Airlines Bid for Frontier Airlines

Here’s the latest missive from the Southwest Airlines’ pilot group, SWAPA, to its members. FAPA is the Frontier Airlines Pilot Association, the union that represents the Frontier Airlines’ pilots.

“It has been a whirlwind week for your M&A Committee. We have been in meetings with our M&A counsel in Washington Monday and Tuesday and quickly returned to Dallas on Wednesday for a pressing meeting with FAPA. We would like to bring you up to date on the Frontier transaction.

Weeks ago, the Company approached SWAPA for ideas on how to complete the Frontier transaction with our pilots’ support. We expressed our concerns about new federal legislation on the books (McCaskill/Bond) and its potential effect on pilot seniority at Southwest. The Company, at SWAPA’s request, included a “labor contingency clause” requiring labor agreements in place prior to the closing of the Frontier acquisition. This action took the possibility of binding arbitration out of play and protected our pilots from a harmful arbitrated seniority integration.

As the Company was developing their formal binding proposal to acquire Frontier out of bankruptcy, Southwest bankruptcy counsel expressed concern that the Southwest bid could be excluded from the auction process because Frontier legal counsel deemed the proposal “not qualified” for the auction process due to the labor contingency clause. However, the labor contingency clause would be deemed acceptable and the bid deemed qualified if SWAPA and FAPA reached an Agreement in Principle for seniority integration. That triggered negotiations Thursday between SWAPA and FAPA.

SWAPA’s concerns throughout this process have been to protect our seniority list and our Collective Bargaining Agreement (CBA). The only way to adequately protect our entire pilot group was to place the FAPA pilots below the SWAPA pilots on our new Master Seniority List.

FAPA’s concerns are:

  • Job Protection
  • Seat Protection
  • Pay Protection
  • Domicile Protection

FAPA’s position was for relative seniority with a “variable” for the ratio for integration. Clearly, meeting all of FAPA’s concerns would be an enormous windfall for Frontier pilots at the expense of Southwest pilots.”

Oh boy. Here we go. All of these concepts sound very familiar don’t they? Relative seniority. “Stapling” the Frontier pilots to the bottom of the list.

And this is supposed to be finalized with both groups signing off on it today??

Right.

Well, there you have it. Either there is an agreement in principle with both pilot groups as to the question of seniority, or it appears that the bid by Southwest will not be considered to be a “qualified” bid.

Do you suppose that Southwest knew this all along, and this is merely an anticipated ‘squeeze play’ made by the company, assuming that the “urgency” of the situation would prod both groups to an agreement before the clock strikes twelve? Or was this a surprise at the last minute to all parties concerned?

Stay tuned.

Southwest Airlines’ Bid for Frontier: Did They Really Think It Was Going to Be Easy?

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Today is the big day. Or it’s supposed to be the big day.

After all the preliminary table setting over the last several days, today was or is supposed to be the day that Frontier Airlines is actually auctioned off.

But, as I wrote about this week in PBB — I think the assumption that this thing was a done deal for Southwest was a bit premature. In addition, yes, I think that if Republic were to be awarded Frontier — that Frontier could continue to operate and it could be profitable. This is not a case where the bankrupt company is on death’s door. Quite the contrary, Frontier has been posting good operational numbers of late, and they have actually used the bankruptcy process to do what a company is supposed to do while in bankruptcy — they’ve restructured themselves quite nicely.

Therefore, I am not surprised at all that reports last night and this morning say that all is not well on the labor front. Specifically in the negotiations between the Frontier pilots and the Southwest Airlines’ pilots.

Remember that Southwest said going into this that their pilots would have to sign off on a deal with the Frontier pilots or the airline would not go through with the deal.

Not sure if Southwest realized that this, coupled with the fact that the Frontier pilots are taking the position that Frontier does not HAVE to go with Southwest for it to remain a viable business — and you’ve got a pretty strong negotiating position for the pilots at Frontier.

We’ll keep you posted.