- The Washington Times - Tuesday, February 27, 2001

The U.S. Supreme Court yesterday upheld a ruling giving American Airlines a $45.5 million judgment against its pilots union.

The decision resulted from a nine-day sickout by the Allied Pilots Association (APA) in February 1999 that led to the cancellation of 6,600 flights and cost the airline nearly $250 million. The pilots ignored a federal judge's order to return to work, which led to a contempt-of-court citation. The $45.5 million fine is one of the largest ever against a labor union.

Drew Engelke, spokesman for the union, said the amount of the fine exceeds the assets of the association. The pilots have placed $20 million in an escrow account that could be seized by American Airlines and its parent company, AMR Corp.

"We don't know what's going to happen," Mr. Engelke said. "We're not going to be discussing that at this time." Among the issues he refused to discuss was whether the fine could drive the union, which represents more than 9,000 American Airlines pilots, out of business.

The APA argued that the federal judge's contempt citation which came 41 hours after American Airlines' request to stop the sickout deprived the union of an adequate opportunity to present a legal defense. The APA also said the sickout was not authorized by the union or the two leaders mentioned in the civil contempt citation.

The airline argued in court that it suffered "huge financial losses" from the sickout.

The Supreme Court let stand without comment the 5th Circuit U.S. appeals court decision against the union in September.

"We certainly believe we had a good argument to present," Mr. Engelke said. "They just chose not to place it on their docket."

American Airlines said in a statement, "This is the outcome we've anticipated. Any further discussions on this issue will now occur between us and the APA."

The union was cited for contempt by U.S. District Judge Joe Kendall in Dallas, who said the two-day delay before the union complied with his return-to-work order was too long. The judge said union officials seemed "determined to fly American Airlines into the side of the mountain."

Many of the pilots called in sick to protest American's acquisition of regional carrier Reno Airlines Inc. The APA said the lower pay scale for Reno Airlines pilots was a threat to their pay and jobs.

In its appeal of the citation, the union said the expedited process deprived the union of "basic procedural protections accorded all other civil-damages case defendants."

American Airlines said the sickout was "an extraordinary example of a union's efforts to defy a court order." The airline said in court papers the union should have set up a phone tree to notify pilots they should return to work immediately and should have updated its telephone hot line to call an end to the sickout.

American Airlines offered to forgive most of the fine in exchange for a contract extension with the union. The union rejected that proposal in September.

The Supreme Court judgment is the latest volley in contentious labor relations for American Airlines and other carriers, fueling calls in Congress for more regulation of the industry and threats by President Bush to intervene.

Talks are scheduled to resume this week between American Airlines and its flight attendants, who authorized a strike in a vote last week.

Meanwhile, United Airlines asked a federal appeals court to intervene in its standoff with its mechanics' union, and Northwest Airlines and its mechanics are scheduled to meet with federal mediators next week in Washington. If they cannot reach agreement, the Northwest mechanics warn, they will strike on March 12.

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