Dear Brian, Gary and John,
Brian, I look forward to our call next Tuesday so that we can “chart a path forward” as you suggested. We do want to do that and more if possible, but I did not want too much time to pass before I get you some of our initial thoughts on the impact of Judge Conrad’s issuance of the Preliminary Injunction and the contents of his Order.
Our immediate thoughts are as follows, but with the caveat that these are only our initial thoughts. We reserve the right to modify them, enlarge the list or even change or reduce it after we talk next Tuesday.
1. USAPA treasury funds (“Funds”), regardless whether they are in the general treasury or part of the special merger assessment fund collected under the USAPA Constitution Art. II, Section 5 .F on p. 12, cannot be used to prepare and file a petition for certiorari to the Supreme Court in Addington if USAPA elects to do that.
2. Funds cannot be used to oppose Plaintiff’s motion for a Permanent Injunction that was filed in Federal District Court in Phoenix on September 4, 2015. As Judge Conrad noted, USAPA must use funds from other sources such as individual contributions from the former East Pilots to engage in anything, especially litigation, that is not for the overall common good of the entire pilot group.
3. Funds cannot be used to defend the Individual Defendants in the Title V litigation, Bollmeier v. Hummel, et al. There are several reasons for this. First, I wrote last March explaining why such expenditures were not in the best interest of protecting the monetary assets of USAPA. (See Ex. A, Harper letter dated March 6, 2015). Put simply, the law is settled that a union cannot pay the costs for the defense of its officers who are defendants in a Title V suit. Nor, for that matter, can the union’s counsel represent those defendants, no matter who pays him. Second, and now perhaps most importantly, Judge Conrad has clearly outlined in his Order his opinion on why what the Individual Defendants have done with the Funds since September 16, 2014 was most likely wrong. Spending more Funds to defend their past and current conduct is not in the interests of the pilot group as a whole. It’s certainly not in the best interests of the Plaintiffs and the pilots they represent in the Title V litigation. Therefore, please make sure that USAPA immediately stops paying for the defense of the Individual Defendants in the Title V action. If this is not done voluntarily, we will file a Motion seeking an order barring the use of Funds for this purpose. The Individual Defendants are free to pay for their own defense however they see fit, but not by using more Funds.
4. No Funds can be used to pay any payables that relate to the merger or the SLI process. This specifically includes the group of “$500,000 in payables” vaguely referenced in the June 30 hearing and the written submissions to the Court regarding the scope of the injunction. In our call next Tuesday, we need to discuss how we can get a complete list of those payables as soon as possible. In addition to the $500,000 in payables, no other payables can be paid from Funds if they relate to the merger or the SLI process. This specifically includes the $198,000 payable to Pat Szymanski noted on USAPA’s LM-2 report for the period ending March 31, 2015.
5. No Funds can be used to pay lawyers, consultants or others who perform any services for USAPA that are not in the collective best interest of the entire pilot group, especially the West Pilots.
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6. Obviously, no Funds can be used to support, either directly or indirectly, the new East Merger Committee. So, if USAPA is still paying for the leased space in Philadelphia and the East Committee is using that space then that practice must stop immediately.
There are other matters that we will need to discuss next week. For example, we need to talk about informal discovery regarding what Funds were actually spent on the merger and the SLI process from 9/16/2014 to the present, so that we can get a better understanding of exactly what has been spent since September 16, 2014 and how the Funds were spent. Judge Conrad specifically noted that the Plaintiffs are entitled to this information in discovery, so it is in everyone’s best interest for us to work out the most efficient way for this to happen. We should also begin to explore if there is some way to bring all of this litigation to an end assuming that a reasonable compromise can be structured based on current realities.
Sincerely,
Marty Harper