Brian P. Leitch, Esq.
Daniel M. Lewis, Esq.
ARNOLD & PORTER LLP
370 Seventeenth Street, Suite 4500
Denver, Colorado 80202-1370
(303) 863-1000
- and -
555 Twelfth Street, NW
Washington, DC 20004-1206
(202) 942-5000
Robert A. Siegel, Esq.
Tom A. Jerman, Esq.
O’MELVENY & MYERS LLP
1625 Eye Street, N.W.
Washington, D.C. 20006
(202) 383-5300
Lawrence E. Rifken, Esq. (VSB No. 29037)
Douglas M. Foley, Esq. (VSB No. 34364)
David I. Swan
McGUIREWOODS LLP
1750 Tysons Boulevard, Suite 1800
McLean, Virginia 22102-4215
(703) 712-5000
Counsel to the Debtors and Debtors-in-Possession
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION
)
In re: ) Case No. 04-13819
) Jointly Administered
US AIRWAYS, INC., et al.,1 ) Chapter 11
) Hon. Stephen S. Mitchell
Debtors. )
)
ORDER APPROVING DEBTORS’ ENTRY INTO COLLECTIVE BARGAINING
AGREEMENTS WITH THE INTERNATIONAL ASSOCIATION
OF MACHINISTS AND AEROSPACE WORKERS
The Debtors and debtors-in-possession in the above captioned chapter 11 cases
filed a motion pursuant to §§ 105, 363 and 1113 of the Bankruptcy Code (the “Motionâ€)2
1 The Debtors are the following entities: US Airways, Inc., US Airways Group, Inc., PSA Airlines,
Inc., Piedmont Airlines, Inc. and Material Services Company, Inc.
2 All capitalized terms not defined herein shall be defined as in the Motion.
2
seeking the entry of an Order approving entry into new collective bargaining agreements
(the “Agreementsâ€) with three work groups within the International Association of
Machinists and Aerospace Workers (the “IAMâ€), IAM Fleet Service, IAM Mechanical and
Related, and IAM Maintenance Training Specialists (collectively, the “IAM Groupsâ€). The
Agreements are new agreements based on the Prior CBAs as supplemented or altered
by the terms described in the documents attached as Exhibit B to the Motion.
Upon consideration of the Motion and any timely opposition thereto, and upon
consideration of the arguments of counsel and any evidence presented or proffered in
support of and in opposition to the Motion, the Court finds3 that: (i) it has jurisdiction over
this matter pursuant to 28 U.S.C. §§ 157 and 1334; (ii) this proceeding is a core
proceeding within the meaning of 28 U.S.C. § 157(B)(2); (iii) venue is proper in this
District pursuant to 28 U.S.C. §§ 1408 and 1409; (iv) proper and adequate notice of the
Motion has been given and no other notice is required under any provision of the
Bankruptcy Code, the Federal Rules of Bankruptcy Procedure or the Local Rules of this
Court; (v) the relief sought in the Motion is in the best interests of the Debtors, their
bankruptcy estates, their creditors and other parties-in-interest; and (vi) the Agreements
strike a reasonable balance among the IAM Group’s members in light of all
considerations and consequences and does not impose terms that are
disproportionately adverse to any members of the IAM Groups and the IAM’s and the
Debtors’ entry into the Agreements is reasonable and appropriate. After due
deliberation and sufficient cause appearing therefor,
3 To the extent required, all findings of fact shall be treated as conclusions of law and all
conclusions of law shall be treated as findings of fact.
3
IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT:
1. The Motion is GRANTED.
2. The Agreements are hereby approved. US Airways and the IAM Groups
are authorized to enter into the new collective bargaining agreements, which will consist
of the terms and conditions contained in the Prior CBAs except as altered or
supplemented by the terms set forth in Exhibit B attached to the Motion, and such
collective bargaining agreements shall be binding upon the parties without the need for a
further order of this Court.
3. The Prior CBAs between US Airways and the IAM Groups are hereby
rejected and no claims arising from their rejection may be brought after the date of this
Order.
4. Nothing contained herein shall constitute an assumption of any
agreement described herein, including without limitation the Prior CBAs, nor shall
anything herein be deemed to convert a prepetition claim into a postpetition claim or an
administrative expense.
5. If, after the Agreements are effective, but prior to the effective date of a
chapter 11 plan of reorganization filed by the Debtors in these cases, the Debtors seek
authorization to reject the Agreements pursuant to § 1113©, upon such rejection any
claims arising from the Debtors’ inability or failure to perform under the terms of the
Agreements shall be treated as general unsecured claims and not as administrative
expense claims, except to the extent that such claims are for compensation or benefits
for services rendered during the pendency of these chapter 11 cases and prior to such
rejection, in which case such claims shall be accorded administrative claim status to the
4
full extent permitted by law. The Debtors reserve the right to argue that no claims for
damages arise as a result of the rejection of a collectively-bargained agreement, and the
IAM reserves the right to argue that a claim for damages does arise as a result of such
rejection.
6. This Court retains jurisdiction with respect to all matters arising from,
based upon, or related to the implementation of this Order.
Dated: Alexandria, Virginia
January __, 2005
___________________________________
HONORABLE STEPHEN S. MITCHELL
UNITED STATES BANKRUPTCY JUDGE
Jan 27 2005
/s/ Stephen S. Mitchell
Entered on Docket: Jan 28, 2005 cb
5
WE ASK FOR THIS:
Brian P. Leitch, Esq.
Daniel M. Lewis, Esq.
ARNOLD & PORTER LLP
370 Seventeenth Street, Suite 4500
Denver, Colorado 80202-1370
(303) 863-1000
- and -
555 Twelfth Street, NW
Washington, DC 20004-1206
(202) 942-5000
-and-
Robert A. Siegel, Esq.
Tom A. Jerman, Esq.
O’MELVENY & MYERS LLP
1625 Eye Street, N.W.
Washington, D.C. 20006
(202) 383-5300
-and-
/s/ Lawrence E. Rifken
Lawrence E. Rifken, Esq. (VSB No. 29037)
Douglas M. Foley, Esq. (VSB No. 34364)
David I. Swan, Esq.
McGUIREWOODS LLP
1750 Tysons Boulevard, Suite 1800
McLean, Virginia 22102-4215
(703) 712-5000
Counsel to the Debtors and Debtors-in-Possession
Docket 1712 Main Document