etops1
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AA And TLV

Sun Feb 24, 2013 1:00 am

I hate to rehash this but can someone with factual knowledge explain to me what is the situation between AA and Tel Aviv ? Is AA banned from flying into TLV? Thank you .
 
PacNWjet
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RE: AA And TLV

Sun Feb 24, 2013 1:46 am

There was a lot of discussion about this in a thread a couple of years ago:

Rumor: AA Looking At DXB And TLV! (by GlobalCabotage Dec 30 2010 in Civil Aviation)

Here is what the person in Reply #57 said:

Israel has some rather stiff laws when it comes to retirement and pensions. When AA canceled TW's old TLV route, they skipped out on paying these pensions and these retirements. Thus, the fear is now that if one of AA's aircraft were to land in TLV, it could potentially be confiscated as collateral. Granted, if AA wanted to start service to TLV - I'm sure this could be rectified easily enough with an 8 figure check.

I don't know if the person who posted this comment is fully knowledgeable, but the post sounds like it is based on a good understanding of the matter.
 
LAXintl
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RE: AA And TLV

Sun Feb 24, 2013 2:14 am

In summary from a document I hold:


Having learnt that the claims of TWA employees in Israel were ignored and they did not receive payments for whose contacts were terminated following TWA's insolvency, the court decided that proceedings would be carried on in order to secure the employees' claims under Israeli law.

The court ordered that the Israeli employees should be paid in a manner similar to the payment made to the employees discharged by TWA in France, somewhat in excess of the sums due the employees as preferred payments under Israeli law.

The court ordered further that, settling of claims against assets in favor of Israeli creditors is deserving of special interest under Israeli law and that dues and severance payments owed to employees holds same stature as other debts such as sums to tax authorities.

Under Israeli law, ancillary proceedings may be upheld if the company does business or holds assets in Israel. In such case, the ancillary award should serve the purpose of justice and efficiency. The fact that these judgments are ancillary means that plaintiff are restricted to collecting assets situated in Israel.



At the time of TWA’s hasty withdrawal in 2001, the claims of 102 ex-employees amounted to $13 million.
From the desert to the sea, to all of Southern California
 
etops1
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RE: AA And TLV

Sun Feb 24, 2013 2:19 am

Thank you very much . That explains a lot .
 
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rangercarp
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RE: AA And TLV

Sun Feb 24, 2013 2:33 am

I still do not understand how these debts were transferred to AA. Wouldn't they have been settled in TWA's bankruptcy? My understanding is that AA simply bought TWA's assets out of bankruptcy, but did not assume any of its debts.
iwgbtp!
 
airtechy
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RE: AA And TLV

Sun Feb 24, 2013 4:57 am

.......and doesn't US Airways fly to TLV. How will this be handled after the merger?

Jim
 
Byrdluvs747
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RE: AA And TLV

Sun Feb 24, 2013 5:58 am

Quoting airtechy (Reply 5):
How will this be handled after the merger?

Simple. AA pays or AA leaves.
The 747: The hands who designed it were guided by god.
 
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EA CO AS
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RE: AA And TLV

Sun Feb 24, 2013 8:27 am

Quoting Byrdluvs747 (Reply 6):
Simple. AA pays or AA leaves.

Or AA appeals and has the case re-opened for review. Plenty of time between now and SOC status...
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
jmc1975
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RE: AA And TLV

Sun Feb 24, 2013 8:49 am

Quoting Byrdluvs747 (Reply 6):
Quoting airtechy (Reply 5):
How will this be handled after the merger?

Simple. AA pays or AA leaves.
Quoting EA CO AS (Reply 7):
Or AA appeals and has the case re-opened for review. Plenty of time between now and SOC status...

It's important to keep in mind the positive relationship and economic impact that US Airways has had on TLV and the Israeli economy since they entered the market in 2009. US employs Israeli airport staff as well as corporate sales personnel in TLV. Their daily A330 has been generating airport rents and landing fees during its four years of operation. That said, it very well could be in the best interest of the Israeli government to forgive the debt that an obsolete airline (TWA) once owed them from over a decade ago, and embrace the new US/AA entity with an enhanced relationship that builds upon the past four years.

[Edited 2013-02-24 00:59:11]
.......
 
ly7e7
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RE: AA And TLV

Sun Feb 24, 2013 8:58 am

Quoting jmc1975 (Reply 8):

And forgo pensions for people who are entitled to receive them? Not going to happen. And if it does for a reason you mentioned - expect a criminal investigation into the underlying conflict of interests.
2 things are endless: ignorance and space
 
jmc1975
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RE: AA And TLV

Sun Feb 24, 2013 9:07 am

Quoting ly7e7 (Reply 9):
And forgo pensions for people who are entitled to receive them?

Absolutely! TWA does not exist anymore. There is no need to turn against a trusted company doing business in Israel. The key word here is forgiveness.
.......
 
AeroWesty
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RE: AA And TLV

Sun Feb 24, 2013 9:14 am

Quoting jmc1975 (Reply 8):
That said, it very well could be in the best interest of the Israeli government to forgive the debt that an obsolete airline (TWA) once owed them from over a decade ago

I thought it was individuals who were owed the money, not the Israeli government.
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ly7e7
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RE: AA And TLV

Sun Feb 24, 2013 9:34 am

Quoting jmc1975 (Reply 10):

AA legally owns the debt of TWA, hence the argument of TWA not existing anymore is completely irrelevant. Forgiveness should be sought with people who were left without their pension savings. And the court ruling clearly sides with them. With all due respect to US and its contribution to the business in TLV - people's pensions come first.
2 things are endless: ignorance and space
 
milesrich
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RE: AA And TLV

Sun Feb 24, 2013 12:12 pm

Quoting ly7e7 (Reply 12):
AA legally owns the debt of TWA, hence the argument of TWA not existing anymore is completely irrelevant. Forgiveness should be sought with people who were left without their pension savings. And the court ruling clearly sides with them. With all due respect to US and its contribution to the business in TLV - people's pensions come first.

How does the AA bankruptcy affect this? Does Israel not recognize US Bankruptcy Law? Was the TWA pension of these employees picked up by the Israeli government? Or under Israeli law, are pension liabilities "nondischargeable" in bankruptcy? I used the quotes because corporations do NOT receive a discharge under Title 11 in the USA. The "old" American ceases to exist when it comes out of Bankruptcy and a new entity is created.
 
klwright69
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RE: AA And TLV

Sun Feb 24, 2013 12:36 pm

Quoting milesrich (Reply 13):
Does Israel not recognize US Bankruptcy Law?

Doubtful. Each country treats debt and bankruptcy differently. USA laws are US jurisdiction, they don't apply in other countries.

You can't run up debts in another country and file bankruptcy in the USA to discharge them. Bankruptcy in the USA will prevent creditors from COLLECTING that debt in the USA. But if you return to that country, you become subject to their laws.

AA may very well have to arrive at some settlement before flying into Israel. The fact they TWA doesn't exist anymore, and hasn't for a long time, is not relevant, since TW did not just stop flying, they were taken over by AA.
 
crAAzy
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RE: AA And TLV

Sun Feb 24, 2013 1:36 pm

I don't understand why people keep thinking that AA is not flying into TLV because of the TWA obligations they inherited.

AA has stated time and time again that has no plans of flying into the middle east, the reasons why, and that they're more than happy to let their partners do the flying.

Whether that mindset changes with the "new" American has yet to be seen; however, I ask yourself:

1. What routes into TLV would AA fly?
2. Can AA offer a better/more secure overall product?
3. How many daily flights would AA have into TLV?
4. What impact would AA's entry into the market from it's hubs have on El AL?
5. What costs will be incurred keeping if the station is kept open? What are the costs of closing the station?
6. Unlike US, does AA really need a marginal route like TLV in it's system to drive profits?

What ever it decides, this is going to be one of the first decisions that US has to make before the "New" American becomes an official entity if they don't want to lose an A330   .
 
CO7e7
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RE: AA And TLV

Sun Feb 24, 2013 2:38 pm

Quoting crAAzy (Reply 15):
1. What routes into TLV would AA fly?

I'll put my money on ORD and/or MIA

Quoting crAAzy (Reply 15):
3. How many daily flights would AA have into TLV?

2

It'll be interesting to see what happens once the merger is complete. I guess its only a matter of time till they make a decision, one way or another.
 
klwright69
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RE: AA And TLV

Sun Feb 24, 2013 2:49 pm

I recall that AA did not continue TW's TLV flight due to "economic reasons."

This allowed CO to take the NYC-TLV market by storm in their absence. When CO entered, it was only Tower Air and TWA.

But CrAAzy really is right. We don't know if AA will even continue the TLV route. We don't know their intentions. We hear TLV is great for US, but ultimately we don't know.
 
dlphoenix
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RE: AA And TLV

Sun Feb 24, 2013 3:15 pm

Quoting crAAzy (Reply 15):
I don't understand why people keep thinking that AA is not flying into TLV because of the TWA obligations they inherited.

AA has stated time and time again that has no plans of flying into the middle east....

Bear in mind the the new AA will be led by a person who was i charge when US started flying to Israel, a route they claim is very profitable.
Discontinuing a route that was introduced by the new CEO is a tad harder than not starting a new route.

Quoting crAAzy (Reply 15):

What ever it decides, this is going to be one of the first decisions that US has to make before the "New" American becomes an official entity if they don't want to lose an A330 .

They will not lose an A330, but they are at risk of having ticket revenues withheld until debt is covered. I assume the route profits are higher than the debt and matter will be therefore settled. It will be then be categorized as an "integration expense" (which will be dwarfed by the cost of integrating the IT systems, operation procedures and other integration costs).
 
klwright69
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RE: AA And TLV

Sun Feb 24, 2013 3:22 pm

I agree with DLPhoenix. They will probably have to settle to continue TLV. And they will probably want to continue it.

This money is owed in Israel, US bankruptcy code does not apply.

[Edited 2013-02-24 07:26:03]
 
dlphoenix
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RE: AA And TLV

Sun Feb 24, 2013 3:32 pm

Quoting rangercarp (Reply 4):
I still do not understand how these debts were transferred to AA. Wouldn't they have been settled in TWA's bankruptcy? My understanding is that AA simply bought TWA's assets out of bankruptcy, but did not assume any of its debts.

Under Israeli corporate law the employees are second priority creditors (the first being government taxes). Banks and other lenders are lower down the ladder. Foreign companies who set up Israeli subsidiaries commit to settle Israeli debt according to Israeli corporate law (in other words, the parent copay is liable). This is no different than most other foreign subsidiaries.
As such, AA which bought TWA assets was responsible for paying out the Israeli debt before paying any other creditors. The same will apply to the new AA which will be paying the old AA creditors.

Hope this helps shed some light.

DLP
 
4engines4lnghll
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RE: AA And TLV

Sun Feb 24, 2013 4:33 pm

Could the same thing that happened to TW/AA happen to US/AA?
4engines4lnghll
 
Bobloblaw
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RE: AA And TLV

Sun Feb 24, 2013 4:34 pm

Quoting crAAzy (Reply 15):
6. Unlike US, does AA really need a marginal route like TLV in it's system to drive profits?

Its marginal and profitable?
 
ripcordd
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RE: AA And TLV

Sun Feb 24, 2013 4:50 pm

But here is the thing AA bought pieces of TWA and they claim they didnt buy the TLV operation of TWA. Now they have or will form a new airline on paper no more AMR or American Airlines so I wonder how that will take in count in TLV....
 
LAXintl
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RE: AA And TLV

Sun Feb 24, 2013 4:58 pm

This debt is not to the Israeli government, but the 102 individual employees who were rightfully due severance and retirement payments under local laws for their long service to TWA (some had 30-year seniority).

They went to court, they got their judgement.

The manner TWA pulled out of Israel was literally overnight, with the airplane not showing up from one day to the other with employees, passengers being left in the open.

Quoting milesrich (Reply 13):
How does the AA bankruptcy affect this? Does Israel not recognize US Bankruptcy Law?

AMR very early in its BK process filed with the US court to make it clear they did not seek to discharge any foreign debts. Its foreign creditors represented about 15% of its total debt, and any BK court action to stay its foreign debts would likely not be enforceable anyhow while subjecting AMR myriad of local legal challenges further complicating the reorganization process and risking those operations.

AMR within weeks of its BK filing was very concerned about foreign airspace and airport access, fuel availability and vendor provided services could be compromised if AMR is unable to meet its obligations including payment of foreign taxes and fees which were running about $250mil in arrears already and sought court permission to expedite payment as any interruptions incurred by actions of foreign governments, companies or courts would diminish the value of the AMR estate and was key AA maintain its international operations on an uninterrupted basis.

This was all detailed in the master AMR BK thread.

Quoting dlphoenix (Reply 20):
Under Israeli corporate law the employees are second priority creditors (the first being government taxes).

If you read reply 2, the claims were elevated by the court to hold the same status as any tax debts.
From the desert to the sea, to all of Southern California
 
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mayor
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RE: AA And TLV

Sun Feb 24, 2013 5:08 pm

Quoting klwright69 (Reply 17):
This allowed CO to take the NYC-TLV market by storm in their absence. When CO entered, it was only Tower Air and TWA.

I wonder how much DL's service JFK-TLV, starting in '91, had to do with TW losing money on the route? As I recall, for a short time it was only Tower and DL. When did TW drop the route? Was it before or after AA bought the assets?

Quoting klwright69 (Reply 14):
AA may very well have to arrive at some settlement before flying into Israel. The fact they TWA doesn't exist anymore, and hasn't for a long time, is not relevant, since TW did not just stop flying, they were taken over by AA.

Perhaps DL can get their lobby display back from US/AA/TW. In '91, when we took over from PA and were initiating our service out of TLV, we had a small lobby display at the Sheraton Hotel where the crews and the TDY personnel stayed as well as the TWA crews. One morning, we came downstairs, very early, to catch the shuttle to the airport and the display was gone...I don't believe it was even there a week...I believe all that was left was the wodden podium that the 767 model sat on. I don't believe it was ever found and the theory was that TWA took it, because they were mad about us starting the service and that the hotel was bending over backwards to help us.
"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
 
ckfred
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RE: AA And TLV

Sun Feb 24, 2013 5:13 pm

I would assume that if US flights to Tel Aviv are profitable, then Doug Parker and his senior management aren't about to end service, just to avoid paying the debts of TWA.

Probably, there will be discussions between US and someone with authority on behalf of the former TWA employees to find a settlement that will lead to the judgment being discharged and US/AA to continue service to Tel Aviv.
 
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RE: AA And TLV

Sun Feb 24, 2013 5:16 pm

Quoting jmc1975 (Reply 10):
Quoting ly7e7 (Reply 9):
And forgo pensions for people who are entitled to receive them?

Absolutely!

  

While those former TW employees may feel shafted, (and frankly, I still don't understand how any court could possibly have sided with them - AA didn't buy TW or legally take on their debts!) enabling a combined AA/US to offer service to/from TLV would be a greater benefit to the citizens of Israel as a whole.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
LAXintl
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RE: AA And TLV

Sun Feb 24, 2013 5:17 pm

Quoting mayor (Reply 25):
When did TW drop the route? Was it before or after AA bought the assets?

March 2001, after the AMR acquisition was announced and TWA was in BK already.

Per AMR press releases at the time:
"AMR's American Airlines unit had said it would not continue the daily nonstop service between the United States and Israel for economic reasons."

and another

''We looked at the Tel Aviv service, and our judgment by the numbers and market projections is that it is not a route that would make economic sense,'' said Al Becker, a spokesman for American."


Dont also forget CO was a big player already in Israel with its daily 777 service.
From the desert to the sea, to all of Southern California
 
LAXintl
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RE: AA And TLV

Sun Feb 24, 2013 5:42 pm

Quoting EA CO AS (Reply 27):
and frankly, I still don't understand how any court could possibly have sided with them - AA didn't buy TW or legally take on their debts!

Here is the scenario.

If you employ people, and you let them go, you must provide severance payment per the law in Israel.

While America might be a easy hire and easy fire country, many many overseas employment markets have very clear guidelines of how you employ or terminate folks.

In this case the Israeli employees failed to get not only the adequate 30-day notice (they were fired overnight in mass), but the company failed provide required severance payments which by law at the time was to receive one month's salary for every year worked.

Following the shutdown, TWA offered severance pay of $3,000 per employee, which was deemed to be breach of law.


As far as the merger, AMR did buy TWA, with the intention AA would become the successor company.
Its a little late to argue otherwise. If AA felt it was so clear it could have pushed its case in the Israeli court accordingly.

Anyhow per April 2001 press release when the merger closed:

American Airlines became the world's largest air carrier Monday after acquiring bankrupt Trans World Airlines.

The deal, which closes the books on the longest-flying carrier in American commercial aviation saw the Fort Worth, Texas-based AMR Corp. agree to pay $742 million for the airline, plus the assumption of $3.5 billion in debt.

Robert W. Baker, vice chairman of American Airlines, was named chief executive officer of TWA L.L.C., the new, wholly owned subsidiary of American."

"Today we celebrate a true milestone for the employees and customers of both American Airlines and TWA. The combination marks the beginning of a new era in aviation, as we bring together some of the most valuable assets and some of the best people in the industry," said Donald J. Carty, chairman and CEO of American Airlines.
"


And this really has nothing to do with Israel being special. It could have happened in other places - like France, but instead TWA/AA opted to properly pay the severance of its employees there which the court noted in its judgement.

Frankly AA at the end imo basically said, screw TLV. Its was not worth it to them.
It could not say the same about France for example and did what it was required to and paid out.

Eventually AA will have to face the music. Its been 12-years already, and maybe this US merger will finally force it to face its obligations in Israel.
From the desert to the sea, to all of Southern California
 
dlphoenix
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RE: AA And TLV

Sun Feb 24, 2013 7:07 pm

Quoting EA CO AS (Reply 27):
While those former TW employees may feel shafted, (and frankly, I still don't understand how any court could possibly have sided with them - AA didn't buy TW or legally take on their debts!) enabling a combined AA/US to offer service to/from TLV would be a greater benefit to the citizens of Israel as a whole.

The employees not only feel shafted, they have a court ruling that confirms that.

I think you are overlooking the fact that any international company opening a local subsidiary assumes responsibilities to abide by the local law. This applies to the parent company, not the subsidiary (This applies to IBM in India, Nestle in Kenya, Microsoft in France and most airlines that open local offices around the world). This process is required to prevent the international entity from leaving the country without closing the business according to the prevailing local laws if something doesn't work (as was the case with AA/TWA).

In the grand scheme of things a settlement of $10-20M will not move the needle comparing to other integration expenses (I am sure UA spent more than 10 time as much in SHARES damage control expenses only by now).

And AA will keep this route as long as Doug Parker is the boss; nobody in corporate America will push to close the route the new CEO is raving about.

Happy travels
DLP
 
ultrapig
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RE: AA And TLV

Sun Feb 24, 2013 7:28 pm

I'm a bankruptcy lawyer. The law is clear.

Under US law AA and USAIR are not liable for any of TWA's obligations. AA bought TWA's assets under 11 USC 363 of the bankruptcy code free and clear of all liens claims and encumbrances. AA is no more liable for pension benefits of an Israeli worker than would someone who bought a TWA plane at liquidation. Its not a question of "non dischargeability". Israeli worker's claims was to the pot of money AA paid for TWA's assets a pot which probably went to mostly secured creditors. In short if this all occured in the Israeli workers are clearly out of luck.

US bankrutpcy laws do not necessarily apply to to Israeli workers in Israel. If Israeli law makes AA liable for the pensions and an Israel Court's order to enforce their rights IN ISRAEL is not necessarily barred by the US bankrutpcy Court. Thus if the workers obtained or have obtained relief in Israel theretically AA assets could be seized in Israel.

This is not a morally right or wrong situation-Had AA not bought TWA the latter would have failed. This is how capitalism works-If you have a pension from a company that goes out of business you may have rights under government programs but corporations, unlike government can't print money.

If the merger goes through you can be assured that the merged company will obtain legal advice from Israeli counsel before continuing service. If counsel advises
that they are at risk they will lobby for a resolution with the government or fly their planes elsewhere.
 
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mayor
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RE: AA And TLV

Sun Feb 24, 2013 7:42 pm

Quoting ultrapig (Reply 31):
If the merger goes through you can be assured that the merged company will obtain legal advice from Israeli counsel before continuing service. If counsel advises
that they are at risk they will lobby for a resolution with the government or fly their planes elsewhere.

Okay, but what about the lobby display??     
"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
 
Navion
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RE: AA And TLV

Sun Feb 24, 2013 8:17 pm

Quoting ultrapig (Reply 31):
Under US law AA and USAIR are not liable for any of TWA's obligations. AA bought TWA's assets under 11 USC 363 of the bankruptcy code free and clear of all liens claims and encumbrances. AA is no more liable for pension benefits of an Israeli worker than would someone who bought a TWA plane at liquidation. Its not a question of "non dischargeability". Israeli worker's claims was to the pot of money AA paid for TWA's assets a pot which probably went to mostly secured creditors. In short if this all occured in the Israeli workers are clearly out of luck.

Finally a cogent comment on this issue. Very well said. To make AA responsible in this situation would be unfair and worse, would set an ominious precedent for any business venture in any jurisdiction. The people who need to clean up this debt are the creditors who received money from AA for the remaining TWA assets. They are TWA with reagard to the Israeli situation. Impound one of the creditors yachts. This isn't AA's responsibility morally or otherwise.
 
LAXintl
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RE: AA And TLV

Sun Feb 24, 2013 8:21 pm

Quoting Navion (Reply 33):
This isn't AA's responsibility morally or otherwise.

Sure it is.. see below.

Quoting ultrapig (Reply 31):
US bankrutpcy laws do not necessarily apply to to Israeli workers in Israel. If Israeli law makes AA liable for the pensions and an Israel Court's order to enforce their rights IN ISRAEL is not necessarily barred by the US bankrutpcy Court. Thus if the workers obtained or have obtained relief in Israel theretically AA assets could be seized in Israel.

Simply put US BK process does not free parties from compliance of relevant foreign laws or foreign court orders.
From the desert to the sea, to all of Southern California
 
Navion
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RE: AA And TLV

Sun Feb 24, 2013 8:32 pm

Quoting LAXintl (Reply 34):
Simply put US BK process does not free parties from compliance of relevant foreign laws or foreign court orders.

Which is why I said "To make AA responsible in this situation would be unfair and worse, would set an ominious precedent for any business venture in any jurisdiction." This is third world type legal behavior and would only chill the interest of any potential acquisition of assets of a company which has done business in Israel (or any other jurisdiction which this type of law). It's too bad. Once again, Israel should direct their legal focus on to the legal remains of TWA which is the creditors, not AA.
 
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RE: AA And TLV

Sun Feb 24, 2013 8:42 pm

Quoting LAXintl (Reply 29):
If you employ people, and you let them go, you must provide severance payment per the law in Israel.

I understand, except AA never employed a single one of those people in Israel. Not one.

Quoting LAXintl (Reply 29):
As far as the merger, AMR did buy TWA

No, as previously cited, AMR bought most of TWA's assets and operated those purchased assets - including their operating certificate - as a wholly-owned subsidiary of AMR. AMR did not "buy TWA", full-stop.

Quoting ultrapig (Reply 31):
AA bought TWA's assets under 11 USC 363 of the bankruptcy code free and clear of all liens claims and encumbrances.

  

I understand that US bankruptcy law doesn't supersede other laws in other nations, however I agree wholeheartedly with Navion's comments:

Quoting Navion (Reply 35):
To make AA responsible in this situation would be unfair and worse, would set an ominious precedent for any business venture in any jurisdiction
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
LJ
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RE: AA And TLV

Sun Feb 24, 2013 9:29 pm

Quoting Navion (Reply 35):
Which is why I said "To make AA responsible in this situation would be unfair and worse, would set an ominious precedent for any business venture in any jurisdiction."

The presedents have already been set. You may think that this is something which doesn't happen often, but in reality it happens more than you know. Moreover, it can happen in virtually eevry country in the world. Finally, how unfair is it when AA decided to pay the French workers and not the Israeli? The only reason probably because they didin't want to axe CDG.

Quoting Navion (Reply 35):
This is third world type legal behavior and would only chill the interest of any potential acquisition of assets of a company which has done business in Israel (or any other jurisdiction which this type of law).

You can include the whole of Europe (probably excluding UK) and still AA flies to continental Europe. Doesn't seem they mind that these countries have these laws..
 
AussieItaliano
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RE: AA And TLV

Sun Feb 24, 2013 9:36 pm

Quoting Navion (Reply 33):
Finally a cogent comment on this issue. Very well said. To make AA responsible in this situation would be unfair and worse, would set an ominious precedent for any business venture in any jurisdiction. The people who need to clean up this debt are the creditors who received money from AA for the remaining TWA assets. They are TWA with reagard to the Israeli situation. Impound one of the creditors yachts. This isn't AA's responsibility morally or otherwise.

Except that an Israeli court HAS made AA responsible.

When foreign airlines fly to the USA, they are not permitted to exercise their interpretation of their home country's law regarding their actions in the United States.

Why should the situation be any different if reversed?

If AA wants to fly to Israel, they will have to respect Israeli law and whatever the Israeli court's interpretation of that law is.

If they aren't willing to do that, don't fly there.

It's just like me drinking booze in Saudi Arabia. I don't think there's anything wrong with having a beer, but under Saudi law, I would be subject to punishment. My only means of protest against punishment would be in a Saudi court. If I'm not OK with the punishment, then I shouldn't drink beer in Saudi Arabia, and if I'm not OK with being judged by a Saudi court, then I shouldn't go to Saudi Arabia.

I do realise that AA has never flown to Israel, only TW did, but the Israeli court has deemed them responsible, so their only recourse is to an Israeli court if they think that the judgment was not fair.
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laca773
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RE: AA And TLV

Sun Feb 24, 2013 9:53 pm

I'm very interested in knowing how US does on PHL-TLV? How are the yields? How do they do in J? Paid versus non-rev/reward seats?

The bottom line is AA has to pay or get out! Why is that so hard for people to understand. It really shouldn't be. It will be interesting to see if the new AA executive management team and it's board will put this to rest and pay what the long time Israeli employees are due!
 
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EA CO AS
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RE: AA And TLV

Sun Feb 24, 2013 9:54 pm

Quoting AussieItaliano (Reply 38):
their only recourse is to an Israeli court if they think that the judgment was not fair.

Previously it wasn't worth AA spending any money on going back to court since they had no intention of serving Israel. Since that has likely changed, I'd imagine AA is definitely willing to appeal the Israeli court's ruling in hopes of getting it reduced or tossed entirely, or possibly even lobby the US and Israeli governments to help broker a mutually-acceptable settlement.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
sankaps
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RE: AA And TLV

Sun Feb 24, 2013 10:03 pm

Quoting EA CO AS (Reply 36):
No, as previously cited, AMR bought most of TWA's assets and operated those purchased assets - including their operating certificate - as a wholly-owned subsidiary of AMR. AMR did not "buy TWA", full-stop.

How does the above statement then reconcile with this April 2001 press release upon deal closure that LAXIntl posted earlier?

"American Airlines became the world's largest air carrier Monday after acquiring bankrupt Trans World Airlines.

The deal, which closes the books on the longest-flying carrier in American commercial aviation saw the Fort Worth, Texas-based AMR Corp. agree to pay $742 million for the airline, plus the assumption of $3.5 billion in debt.

Robert W. Baker, vice chairman of American Airlines, was named chief executive officer of TWA L.L.C., the new, wholly owned subsidiary of American."

It seems to me that "acquiring bankrupt TWA" is the same as "buying" it, is it not? And the press release also says it paid $742M for THE airline (not for parts of it or most of it), and assumed $3.5B of debt. It is not like they just bought the assets in a liquidation sale.
 
toobz
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RE: AA And TLV

Mon Feb 25, 2013 12:04 am

I'll try to shed some light on this to our US members. The US employers and employees are normally "at will". Both parties can disengage at any time for whatever reason. In Europe and a lot of other countries, you have a contract. It's very hard to get out of these. Very hard to fire employees unless they have done something "gross" and outrageous..like stealing. that's why TW,AA, is responsible for the dues. Very simple.
 
crAAzy
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RE: AA And TLV

Mon Feb 25, 2013 12:16 am

Quoting sankaps (Reply 41):

It seems to me that "acquiring bankrupt TWA" is the same as "buying" it, is it not? And the press release also says it paid $742M for THE airline (not for parts of it or most of it), and assumed $3.5B of debt. It is not like they just bought the assets in a liquidation sale.

This debt likely had more to do with aircraft payments/leases, facilities, gate leases, taxes, etc. that were acquired. They did not just assume all of TWA's debt outright.

Quoting AussieItaliano (Reply 38):

Except that an Israeli court HAS made AA responsible.

If AA wants to fly to Israel, they will have to respect Israeli law and whatever the Israeli court's interpretation of that law is.

        

Again, I'll point out that AA in the past has made it clear hat has no plans of flying into the middle east for multiple reasons first and foremost being security concerns and economics. They're more than happy to let their partners do the flying and I see no indication that things have changed. Certainly not enough to justify 1 daily flight PHL-TLV and they're not likely to enter markets like NYC,ORD,LAX where they code share with LY.
 
usflyer msp
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RE: AA And TLV

Mon Feb 25, 2013 12:25 am

Quoting crAAzy (Reply 43):
Again, I'll point out that AA in the past has made it clear hat has no plans of flying into the middle east for multiple reasons first and foremost being security concerns and economics. They're more than happy to let their partners do the flying and I see no indication that things have changed. Certainly not enough to justify 1 daily flight PHL-TLV and they're not likely to enter markets like NYC,ORD,LAX where they code share with LY.

That AA is dead. The management of the new AA has different priorities. The PHL-TLV has done great for US and I don't see them dropping it, even if they have to pay 20 Million dollars, its not that much money. I could also see AA adding a MIA-TLV to complement PHL.
 
toobz
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RE: AA And TLV

Mon Feb 25, 2013 12:49 am

crAAzy..For AA to say that and mean it doesn't make sense. They would LOVE to fly TLV. They CAN'T without paying 10s of millions. That's why they don't. It's a huge money maker for airlines. If AA wasn't responsible for the debt, they would be flying there already. Do you really think AA mngt is gonna say.." Oh we would love to fly to TLV but we don't any to pay what's owed?" No lol of course not. Instead the answer is " security concerns and economical reasons" and they can rely on there partners.
 
jmc1975
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RE: AA And TLV

Mon Feb 25, 2013 1:01 am

Quoting usflyer msp (Reply 44):
I could also see AA adding a MIA-TLV to complement PHL.

Why would they dump a bunch of added capacity on a route that has limited network connectivity? A MIA-TLV route would only capture local traffic and Caribbean & Latin American connections, which is adequately served by BA via LHR and IB via MAD.
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LAXintl
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RE: AA And TLV

Mon Feb 25, 2013 1:02 am

According to CO CEO Larry Kellner, Tel Aviv was their most profitable longhaul service back in 2006.

http://www.globes.co.il/serveen/globes/docview.asp?did=1000162917

Certainly no reason why AA could likewise also not prosper on commercial grounds in Israel.
From the desert to the sea, to all of Southern California
 
Navion
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RE: AA And TLV

Mon Feb 25, 2013 1:03 am

It's just like me drinking booze in Saudi Arabia. I don't think there's anything wrong with having a beer, but under Saudi law, I would be subject to punishment. My only means of protest against punishment would be in a Saudi court. If I'm not OK with the punishment, then I shouldn't drink beer in Saudi Arabia, and if I'm not OK with being judged by a Saudi court, then I shouldn't go to Saudi Arabia.


AA didn't figuratively "drink the booze" in this case. They haven't done anything any differently than US, CO, or DL with regard to Israel other than buy the assets of TWA. A press release saying they've "bought TWA" doesn't give all of the details of the deal (which fills hundreds of pages no doubt). There seems to be a political element to this.
 
MAH4546
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RE: AA And TLV

Mon Feb 25, 2013 1:45 am

Quoting jmc1975 (Reply 46):
Why would they dump a bunch of added capacity on a route that has limited network connectivity? A MIA-TLV route would only capture local traffic and Caribbean & Latin American connections, which is adequately served by BA via LHR and IB via MAD.

Maybe because it's a huge local market of around 115 PDEW? It would also capture connections from LatAm and Florida.
a.