US Airways pilots union objects to American Chapter 11 plan

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The US Airline Pilots Association (USAPA) has filed a limited objection to American Airlines' Chapter 11 reorganisation plan, despite maintaining its support for the merger.

The union, which represents pilots in the pre-America West Airlines merger US Airways operations, includes four objections in its filing with the US Bankruptcy Court for the Southern District of New York on 30 July.

USAPA claims that the plan as presented fails to demonstrate a viable business strategy for the merged airline's regional carriers, specifically American Eagle Airlines.

"The plan has failed to adequately explain their plans for American Eagle and other regional carriers such as the wholly owned subsidiaries of US Airways, and their expected impact on the mainline business," it writes in the filing, citing Eagle's high cost structure.

The union also alleges that a non-consensual release of claims for non-debtors clause in the reorganisation plan could allow US Airways to reject the memorandum of understanding (MoU) between the union, the Allied Pilots Association, American and US Airways.

USAPA members approved the MoU, which will act as an interim labour agreement once the merger closes, with 75% voting for the agreement in February.

The union's final objections are against the proposed severance package for Tom Horton, chairman and chief executive of American, and the fact that USAPA is not defined as a union in the plan.

USAPA maintains its support for the merger, which is expected to close in September, despite these objections.

American and US Airways decline to comment.

Separately, the city of Fort Worth, Texas, objected to American's decision to terminate its lease for its now closed maintenance facility at the city's Alliance Airport as part of its reorganisation plan. The city claims that the airline has not successfully filed a motion to terminate the lease in bankruptcy court to date.

Chris Mosley, senior assistant attorney for Fort Worth, told the Fort Worth Star Telegram that they expect the airline to file a motion terminating the leases before a 15 August hearing on the reorganisation plan.

American closed its maintenance base at Alliance at the end of 2012.