USA: Supreme Court Sides with American Airlines Over Union

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WASHINGTON -- The U.S. Supreme Court on Monday let stand a ruling that a pilots union and two of its officers must pay $45.5 million in compensatory damages to AMR Corp.'s American Airlines, the nation's second-largest airline, for refusing to halt a sickout in 1999.

Without any comment or dissent, the high court rejected an appeal by the Allied Pilots Association, representing American's 10,500 pilots, and its president, Rich LaVoy, and vice president, Brian Mayhew, at the time of the sickout.

The award was assessed because the union ignored a federal judge's order to cease a February 1999 pilot sickout that was ruled illegal.

The 10-day sickout canceled nearly 6,700 flights, snarled American's flight schedule and cost the airline more than $225 million. Pilots launched the labor disruption to protest American's acquisition of smaller Reno Air, whose lower-paid pilots were seen by the union as a threat to job security.

The amount of the award was intended to reflect the cost to American between the judge's issuance of the order to cease the action and the actual end of the sickout.

A U.S. appeals court based in New Orleans upheld the award in September.

The union appealed to the Supreme Court, saying such a civil contempt case involving a complex injunction, disputed factual issues and a serious sanction should be decided in accord with basic due process principles and not through the expedited procedures of a summary nature.

But the justices sided with the airline, declining to review the case. American Airlines told the high court it suffered ''huge financial losses'' because of the sickout.

AMP Section Name:CorpWatch