US Airways Seeks Help for Warring Pilots

US Airways said a pilot seniority dispute has created an untenable situation where either choice would cost it tens of millions of dollars.
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TEMPE, Ariz. (

TheStreet

) --

US Airways

(LCC)

said it is caught between its two warring pilot groups and it wants a federal judge to rule it will not be liable for picking one group's preferred seniority list over the other's.

In a case filed Monday in U.S. District Court in Phoenix, the carrier asked for declaratory judgment regarding the seniority issue that, since the 2005 merger between US Airways and

America West

, has divided pilots into two warring factions.

In its filing, the airline said it is in an "untenable situation." The US Airline Pilots Association, the union dominated by pilots from pre-merger US Airways, "has made crystal clear" that it will only accept a date-of-hire seniority list, the filing said. But the former America West pilots, who are in the minority, have "made crystal clear" that they will only accept a controversial seniority list drawn up by arbitrator George Nicolau after the two groups agreed to binding arbitration.

Acceptance of the union's position could expose the carrier to tens of millions of dollars in litigation costs if the west pilots were to prevail in a court challenge, while acceptance of the west pilots position could lead to hundreds of millions of dollars in lost revenues and good will if a job action followed, the filing said.

"Our worst case

scenario would be we go through negotiations, conclude an agreement and then get sued by west pilots and they prevail, and then the

contract we negotiated is illegal and then we have to start all over," Paul Jones, US Airways vice president of legal affairs, said Monday on a conference call with reporters. "We're asking for a declaratory judgment that tells us right now what rights and obligations we have, and what rights and obligations USAPA has.

"Rather than waiting until there is a contract in place and then have a lawsuit that might undo the contract, we're asking the court to determine what we and USAPA can legally do," Jones said. "If the court gives us what we're asking for, there would be no basis for a lawsuit once the contract is in place."

Jones said the case could be concluded in a few months if the attorneys for the two sides will agree not to duplicate the discovery process that occurred last year, when the court heard its first case on the seniority ruling. In that case, Judge Neil Wake ruled that USAPA was not fairly representing all of its pilots because it had not implemented the Nicolau award. In June, the U.S. Appeals Court in San Francisco

overturned that ruling , saying it was too soon for a decision because no seniority ruling has been implemented.

The case has been assigned to Judge Roslyn Silver, but Marty Harper, attorney for the west pilots, said he will ask that it be moved to Judge Wake. "This is normally routine, when you've got a related case pending," he said.

In its filing, the carrier seeks three court findings -- that a contract without the Nicolau ruling would not violate labor law, that a contract with the Nicolau ruling would not violate labor law, and that a contract without the Nicolau ruling would not subject the carrier to liability. Harper said he would oppose the first and third requests. In those request, he said, the airline "is litigating a bad faith bargaining position against USAPA, saying it's a violation of the Railway Labor Act for USAPA not to consider all reasonable alternatives.

"Whatever comes out has to be fair to both side," Harper said. He said he did not believe that concept of "fences" -- which enable pilots to maintain their existing flying and which have been proposed by USAPA -- would work. But he noted "We have to wait and see what they come up with."

Meanwhile, in an e-mail to its members late Monday, USAPA said it would oppose the airline's requests. "The company is seeking immunity," the union said."The suit appears calculated to provide an excuse to hold up progress in bargaining."

USAPA's view is that the appeals court ruling clearly enables a contract agreement that does not include the Nicolau award, as long as that contract provides a seniority agreement that is fair to the west pilots. As a result, the union believes it does not need a second court's approval to negotiate such a contract.

The appeals court ruling also clearly anticipates that west pilots would file a suit after a contract agreement is reached. Union leaders believe they can structure a contract with fences that would prevent west pilots' routes from being flown by east pilots, and that over time many west pilots would replace retiring east pilots on the most desirable international flights.

-- Written by Ted Reed in Charlotte, N.C.

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