Another dedicated AA exec jumps ship.

[Hopeful]

American Airlines sues NY exec over Delta jump
The carrier’s highest-ranking NYC executive has been temporarily barred from starting a new gig at rival Delta until a court settles allegations that he’s stealing company secrets.
By Hilary Potkewitz

When Chuck Imhof, a 22-year veteran of American Airlines and its regional head of New York sales, announced he was moving on to the next phase of his professional life, his coworkers did not throw him a farewell party. Instead, his former company served him with a big fat lawsuit this month.

Mr. Imhof’s left American to take the same job at Delta Air Lines, the carrier’s chief competitor here. American accused Mr. Imhof, its highest-ranking executive here, of stealing company secrets by emailing confidential strategy and pricing documents to his personal account prior to his resignation, according to the May 13 lawsuit filed in U.S. District Court.

The suit sought an injunction barring Mr. Imhof from starting his new job. The court granted a temporary injunction of about three weeks.

This is just the latest move of one-upmanship between these two major carriers as they battle for dominance in New York.
In 2007, Delta executives announced plans to make John F. Kennedy International Airport one of its international hubs in order to “challenge American Airline’s dominance.†Meantime, American opened its $1.4 billion new terminal at JFK in the fall of that year .

According to the most recent Port Authority data, American carried 12.6 million passengers through area airports in the 12 months ending March 31, while Delta was right behind with 11.6 passengers. Delta beat out American at JFK, while American outcarried Delta at LaGuardia Airport.

American contends that Mr. Imhof’s violated contractual agreements and standards of business conduct, and seeks damages potentially in the hundreds of thousands of dollars in clawbacks of Mr. Imhof’s deferred compensation, performance bonuses and stock options, and repayment of its legal fees. The suit also seeks to bar Mr. Imhof from working for Delta.

“Imhof is unable to work for Delta in an identical role in New York without using American’s confidential trade secret information,†reads the lawsuit.

An American Airlines spokesman declined to comment beyond the filing. Delta declined to comment on the litigation or make Mr. Imhof available for comment.

The injunction expires June 4.

 

[JFK Fleet Service]

According to the most recent Port Authority data, American carried 12.6 million passengers through area airports in the 12 months ending March 31, while Delta was right behind with 11.6 passengers. Delta beat out American at JFK, while American outcarried Delta at LaGuardia Airport.

Please, American is the French of the airline industry here in the NY market...surrender is all we do.

When I got to LGA in early 2002 we were running 71 mainline departures a day out of there, now it's down to 48 and the YYZ trips are going all Eagle by June 1.So down to 46 and there's talk of more cuts coming.

Funny how we'll open up a YYZ inbound during an OSO and it would be full of Eagle bags from all of their canceled flights.Now, they're going to be SOL, or on Air Canada.S'alright though, we ceded BOS and DCA, YYZ is just another capitulation in the long line of them.

In the very near future you're going to be able to get on a mainline jet at LGA and be able to fly to exactly three places...ORD,DFW or MIA.


As I said in a post long ago on this forum, we should yank the Eagle off the tail of the airplanes and replace it with a urine yellow chicken, because this company has lost its nads and just flat out runs away.

Midwest is a perfect example, we pulled out of LGA-MCI because of their presence in the market.Okay, now Midwest is bleeding out, they're down to 9 mainline airplanes and that LGA-MCI is flown by Republic E-170's most days.There was a time not too long ago this company would gotten the scent of blood in the water and moved on Midwest, adding a turn or two on the route.Plus MCI is still in theory a maintenance base, so you could even schedule the plane in for maintenance without needing a ferry.


Don't even get me started on the Maginot Line at JFK...

 

[lucky lucchiano]

I use to feel the very same way you do about the situation at JFK.
But truth be told, during these slow $$$ times, let DL do(pretty much) what they want to do, out of Kennedy(FOR NOW)

I don't think ANYTHING would be different(today)(at JFK), even if (uncle) bobby CRANDALL were running the show.

He'd say(something like this),.........."Who cares if DL runs year round from JFK to BUCHAREST" etc.

But he'd "exterminate" DL if they made a serious run at JFK-LHR/LAX/SFO/MIA. Thats were the real JFK $$$ is at(these days), and more than anyone, DL knows it !!!

NOW, should the economy really turn around, well thats another story. Besides, AA is "right sizing" themselves(especially at JFK) for BA !

Screw DL !!!!!!!

 

[eolesen]

American contends that Mr. Imhof’s violated contractual agreements and standards of business conduct, and seeks damages potentially in the hundreds of thousands of dollars in clawbacks of Mr. Imhof’s deferred compensation, performance bonuses and stock options, and repayment of its legal fees. The suit also seeks to bar Mr. Imhof from working for Delta.

I thought management just had to hint at another job to get a big fat raise and a retention bonus.... If that's the case, why did he go work for DL???

In management, resigning doesn't release you of certain obligations. When I left, I was told I couldn't seek to do business with AA for two years after leaving (AMR could seek to do business with me, however), and I couldn't recruit employees away without AMR's consent. I didn't bring a lot of confidential docs with me, either. Just a ratty copy of Regs, which is still sitting in a box somewhere, and a DVD with the previous two years worth of email...

If he really did email work docs to a personal address, then he's an idiot. That's what USB drives and CDROMs are for....

 

[Hopeful]

I thought management just had to hint at another job to get a big fat raise and a retention bonus.... If that's the case, why did he go work for DL???

Maybe Delta paid him a nice bonus for joining the enemy....Maybe he "had" to leave. He was probably "sticking' it to AA....And that's a big no-no..........no matter ho you are.


And I have to agree with you about AA's eagerness to quit markets at the hint of competition.

Bailing out of ISP years ago really worked out well for Southwest.

 

[FWAAA]

Here's a link to the complaint in AA's suit against him:

http://www.hudsoncrossing.com/pdf_files/Complaint09-4535.pdf

At first, I figured that AA obviously didn't offer him enough money to stay.

After eolesen's post and reading the complaint, I've changed my mind. He's an idiot - good riddance.

 

[The Goose]

10-4 re: an idiot. All considered, TULE management would have been a better fit for this SOB.

It's difficult believing someone is dumb enough to leave such a large trail of breadcrumbs with his company computer. Evidently, this example of corporate brilliance thought data-tracking like that only happened in the movies and funny papers. I wonder what shape the company would be in (with respect to corporate espionage) if intelligent individuals were hired instead of this level of trash?

One good thing about the salaried twits - they do provide a good deal of entertainment.

 

[Hopeful]

Here's a link to the complaint in AA's suit against him:

http://www.hudsoncrossing.com/pdf_files/Complaint09-4535.pdf

At first, I figured that AA obviously didn't offer him enough money to stay.

After eolesen's post and reading the complaint, I've changed my mind. He's an idiot - good riddance.

Not gonna work this time FWAAA...This guy screwed up..He screwed AA...so there's no need to offer him the traditional retention pay and bonus.....

And yes he is an idiot....

 

[commavia]

And I have to agree with you about AA's eagerness to quit markets at the hint of competition.

I'm curious to know what people expect AA to do when they have uncompetitive labor costs that make it virtually impossible for them to compete effectively in many (though not all) markets?

I'm not necessarily referring to LGA-YYZ, or LGA overall, specifically, but in general, does anyone else notice the pattern that as AA's mainline (and Eagle, for that matter) labor costs have continued to become farther and farther (higher, of course) than industry average, retrenchment has accelerated? Anyone else suppose there's any connection?

I, for one, suspect that AA probably wouldn't be parking quite as many airplanes left and right and dropping more and more flying down to Eagle or nothing if they were able to pay their employees what those same employees are getting paid at, say, USAirways, or AirTran, or JetBlue.

Now, that's not to say that one pay scale is better or worse than another: that's up to the unions, their members, and the company to ultimately negotiation. But to act surprised that AA can't stay economically competitive, when it's plainly obvious to anyone that AA's labor costs (among many other also-high costs, admittedly) are not economically competitive, seems a bit disingenuous.

And this is of course not to say that management doesn't have a role to play. They have made some stupid product, service, network, sales and strategy decisions in the last few years that have certainly made it more difficult for AA to compete effectively in many places. But, on balance, from my perspective, all of the bad management decisions of the last decade combined does not amount to the same driver of uncompetitiveness as AA's above-market compensation (cash, not stock option-based) levels.

 

[Hopeful]

I'll tell you what newbie..would you be happy if we all worked for minimum wage so AA can fly in every possible market?

 

[Rogallo]

I'm curious to know what people expect AA to do when they have uncompetitive labor costs that make it virtually impossible for them to compete effectively in many (though not all) markets?

Gentlemen....start your engines.

 

[wcs]

And this is of course not to say that management doesn't have a role to play. They have made some stupid product, service, network, sales and strategy decisions in the last few years that have certainly made it more difficult for AA to compete effectively in many places. But, on balance, from my perspective, all of the bad management decisions of the last decade combined does not amount to the same driver of uncompetitiveness as AA's above-market compensation (cash, not stock option-based) levels.

Commavia may not post what you like but does post from a balanced perspective. I have read other Commavia posts on other sites and the poster seems to be insightful with a very deep analysis. Don't be fooled by the newbie designation. Note the date of joining. I suspect Commavia reads a lot but posts only when necessary.
Having said that I disagree with the opinion and believe that bad management decisions created the current situation. If the "shared sacrifice" promise had been kept we would already have contracts with which the company could compete.
My apologies to the moderators, since this is off topic.

 

[commavia]

I'll tell you what newbie..

I may not be a habitual poster on the USAviation.com boards (though I do post often elsewhere), but I assure you I am no newbie to the issues being discussed here. I am intimately aware of exactly what we're talking about, and have seen it before countless times in my life from many angles - including management and labor.

I am not anti-management or anti-labor, and I sincerely want everyone to win, which I believe is completely possible. I also believe that in many times in the past, both management and labor have made bad decisions, advanced stupid strategies, and released stupid comments that have hurt both of their causes.

would you be happy if we all worked for minimum wage so AA can fly in every possible market?

No, I'd be happy if management got paid what it was worth, based on the prevailing market rate of compensation for their skill and the tasks they are responsible for. And, likewise, I would be happy if labor got paid what it was worth, based on the exact same criteria. It's not my job or desire to figure out what those numbers should be. As I said, that is the job of the unions, their members, management, and the overall market, not me.

If you look across Corporate America at what executive-level talent are making at companies considerably smaller than American, it becomes instantly clear how astoundingly underpaid AMR executives are, especially considering how much more stressful and complex it is to run an airline than to run many (if not most) other businesses. Now, of course, that's not to say that each and every AA exec is worth what they make now - let alone the additional money the market says they're worth. Many of AA's current group of execs are useless wastes of life who abuse their employees, contribute nothing to the company and do nothing but take up space and resources. I know, I've seen much of it first-hand. But that doesn't change the fact that there are also some really top-notch execs at AA who have worked their way up through the ranks, learned the business and the operation, and are absolutely brilliant at what they do, but are leaving because they can make so much somewhere else. (Ex-CFO James Beer comes to mind instantly.)

After all, labor (some of it) likes to constantly complain about how incompetent management is, how much they screw up, etc., but some refuse to give management credit where it's due, like:

* keeping AA out of bankruptcy when virtually every other competitor used it as a business strategy
* not using Section 1113 (or the threat of it) through bankruptcy to force even-more-severe cuts on labor
* continuing to fully-fund ALL of AMR's defined-benefit (DB) pensions, unlike ANY OTHER AIRLINE in America
* investing billions in new airplanes that will be absolutely critical to competing in the future
* reducing net debt to levels not seen since 1998, AMR's best financial year ever

And all of this, it bears repeating, through two wars, two recessions, a terrorist attack, two pandemic flu scares, and an unprecedented spike in fuel prices, among others. All in all, not bad. Not perfect, no doubt - AMR management has made MANY mistakes, and I've been more than willing to say so - but all in all, not bad.

So to complain about how management is being unfairly compensated seems to ring a bit hollow for me, especially considering that the stock option performance-based, compensation (that all the unions were fully aware of and agreed to, I might add) that Arpey & Co. are getting is a completely non-cash cost to the company. Not one dime is coming out of AMR's bank account to give Arpey his stock options.

The unions, on the other hand, are constantly demanding additional cash compensation and other benefits and work-rules with substantial cash cost to AMR - i.e., money would be coming directly out of AMR's bank account. And, again, it bears repeating: this is when most AMR employees are already compensated (both on the basis of just salary, and especially once factoring in medical benefits and a DB pension) well above most of their counterparts at AA competitors.

As I have continually said, if AMR's unions wanted to demand more stock options - in addition to the ones they already got in 2003 - so they can even further "participate in the upside" of the company, I'm sure AA would be more than receptive to such a proposal. But again, that's not what they've proposed - they want cold, hard cash, which AMR simply cannot afford to pay.

So again, I ask you: how, exactly, do you expect AA to be competitive?

 

[Hopeful]

So again, I ask you: how, exactly, do you expect AA to be competitive?

One has to wonder, if you are indeed not a newbie, you decided to get in on this debate because AA was criticized about bailing out of markets. Your main concern is AA's competiveness and how they just can't afford to give us cold hard cash.
They had no problem taking from us using a "veiled" threat of bankruptcy. Here we are 6 years later and folks like you tell us we're unreasonable and unrealistic in asking for restoration of concessions.

If you have been reading this forum for years, I'm not going to rewrite what I've been responding to pro-company anti unionists on this forum.

I, as a mechanic, lost $20,000a year for six years now. The stock that you say we should've negotiated more for would have had to hit $300 a year for me to get back what was lost.
Having said that, when AMR stock reached the $40 area, even if I dumped my 449 shares, it barely made up for one year's loss. And let me remind you about the "economic conditions."

The 6 year contract from 1995-2001 the company gave us 6%........6% for six years and during those six years AMR had some of the most profitable quarters and years in its history.

The bottom line is this company does not want to negotiate in good faith. they don't want to give us anything.

One final note, the concessions we gave were supposed to PREVENT layoffs. Well guess what, many layoffs followed.



You know what I want AA to do to be competitive?

SHRINK TO PROFITABILITY......

 

[JFK Fleet Service]

AA executives underpaid relative to their peers at other smaller companies? Why is the AA executive viewed as under paid? Maybe the execs at those smaller companies are overpaid? If executives at a larger and exponentially harder to run business are paid less maybe the execs at the smaller company are grossly overpaid.

But that theory only applies to management doesn't it?

The people that make the airline run every single day should be lucky to have jobs? Or accept whatever management deigns to throw us?

Bovine Scatology.