OMNI435
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Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 1:56 pm

I figured this was only a matter of time. Republic has been canceling nearly 10% of their schedule every day due to pilot shortages.

http://www.ibj.com/articles/55195-de...over-flights-lost-to-pilot-dispute
 
Dallas
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 2:22 pm

DL's legal department seems to be quite busy these days. Lawsuits against the City of Dallas, AA (LAX-HND), and now this, as well being active with the whole ME3 saga and ATL alternate airport. As successful and positive my experiences have been on DL, this is putting a pretty bad taste in my mouth. I wasn't happy with when they dehubbed DFW and now with the lawsuit against DAL, they just seem to complain and file lawsuits whenever they don't get their way.
 
stlAV8R
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:14 pm

I wonder how long it will take before they take the same action as they did with YV/F8. I'm sure they would love to rebid this contract out to other carriers for less.

Does anyone know who owns the planes S5 flies for DL? Are they owned by DL and leased to S5 or are they owned by Rebublic?
 
slider
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:16 pm

I think we all understand the value of a contract, and certainly these capacity purchase agreements between major and regional airlines aren’t simply crafted devices, but while it may legally be DL’s recourse to act in this manner, it’s short-sighted. Litigation won’t help Republic’s pilot situation, nor will whatever their incentive payments are be adjusted to correct for what is sure to be a substantially higher flight ops cost for RP. They’re offering signing bonuses in fact to recruit pilots.

The problem is far deeper than the temporal acts of DL’s legal team.

And could be an ominous harbinger of things to come for the regional industry as a whole given 117 rules.

In this case, it’s beneficial, though not ‘required’ for a major to work with their regional partners to arrive at solutions. And that isn’t going to happen from a courtroom.
 
ty97
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:24 pm

Quoting Dallas (Reply 1):
Lawsuits against the City of Dallas, AA (LAX-HND), and now this,

Minor clarification: I don't believe there is a lawsuit per se over LAX-HND, but definitely Legal is involved with filing a petition/request with DOT. (Courts are not involved there though AFAIK).

Quoting stlAV8R (Reply 2):
I wonder how long it will take before they take the same action as they did with YV/F8. I'm sure they would love to rebid this contract out to other carriers for less.

This has the potential to actually cut both ways for DL. All three legacy majors use Republic and all three (I presume) are impacted to some extent by the pilot issues. If DL were to successfully dump Republic, that would actually help DL's competitors AA and UA to have less of a Republic pilot issue.
 
Mir
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:32 pm

Everyone and their brother knew Republic was having staffing issues, but Delta still decided to renew its contract with them. I don't see how they have much of a leg to stand on here.

-Mir
7 billion, one nation, imagination...it's a beautiful day
 
stlAV8R
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:33 pm

Quoting ty97 (Reply 4):
This has the potential to actually cut both ways for DL. All three legacy majors use Republic and all three (I presume) are impacted to some extent by the pilot issues. If DL were to successfully dump Republic, that would actually help DL's competitors AA and UA to have less of a Republic pilot issue.

It really depends on what happens with the aircraft. If they are S5 birds then they will need to place them fairly quickly to mitigate losses which won't be that easy and definitely won't be at favorable terms for S5 as AA, AS, and UA (who are all possible operators) would squeeze them knowing their situation. Furthermore, they would be weary I'm sure to hop in bed with them (again assuming S5 owns the planes) as they would have the very issue DL had with pilot shortages. Now, if they belong to DL then you may be right. I don't think it will help S5 that much as they aren't just having a problem recruiting new pilots, but they're also having a problem retaining pilots. You can guarantee that some pilots will follow the plane if they belong to DL and will end up wherever they are placed as some pilots will be in hopes of a better regional to work for (if that even exist )
 
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adamblang
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:33 pm

On page 23 of Republic's 2014 annual report, they indicate they own 18 ERJ-145s and lease 23 ERJ-145s, own 144 E-170s/E-175s and lease 23 E-170s/E-175s. Not clear to me what the own/lease mix for the aircraft flying for Delta is.

But, per page 10 of the report, it's kind of irrelevant: if Delta canceled Republic's flying, Delta can make Republic lease/sublease/buy the aircraft and/or Republic can make Delta lease/sublease/buy the aircraft:

Quote:
Unless otherwise extended or amended, the code-share agreement for the E145 aircraft terminates in May 2016. Delta may terminate the code-share agreements at any time, with or without cause, if it provides us 180 days written notice, for the E145 regional jet code-share agreement, or after July 2015 for the E175 regional jet code-share agreement. With respect to the E145 agreement, if Delta chooses to terminate any aircraft early, it may not reduce the number of aircraft in service to less than 12 during the 12-month period following the 180 day initial notice period unless it completely terminates the code-share agreement. We refer to this as Delta's partial termination right.

If Delta exercises this right under the E145 agreement or the E175 agreement or if we terminate either agreement for cause, we have the right to require Delta either to purchase, sublease or assume the lease of aircraft leased by us with respect to any of the aircraft we previously operated for Delta under that agreement. As of December 31, 2014, the Company estimates a payment of $158.8 million and $171.3 million would be required from Delta should they exercise the early termination provision under the E145 or E175 agreement, respectively.

If we choose not to exercise our put right, or if Delta terminates either agreement for cause, they may require us to sell or sublease to them or Delta may assume the lease of aircraft leased by us with respect to any of the aircraft we previously operated for it under that agreement. There is no early termination provision for E170 aircraft under the E175 agreement.

On December 11, 2014, the Company entered into Amendment Number Seven to the Delta Connection Agreement with Delta Airlines, Inc. dated as of January 20, 2005. Under the Agreement, the Company operates 14 E170 and 16 E175 aircraft as Delta Connection. The amendment provides for, among other things, an agreement for Shuttle to operate nine additional E170 aircraft to be placed into service between the third quarter of 2015 and the second quarter of 2016 for a term of six years per aircraft. The amendment also provides for an extension of the air transportation services provided by the Company with respect to the 14 E170 for another four years, for terms ending from May 2021 to October 2021, and extend the 16 E175 aircraft by approximately five years, for terms ending from August 2023 to February 2024. Delta may further extend the service terms for any or all of the 14 E170 and 16 E175 aircraft for an additional five years. The amendment also provides that Delta may purchase any or all of the E175 aircraft for an amount equal to the net book value of such aircraft at the end of the current terms for such aircraft or at any time during the extended terms, in which case Delta would lease the purchased aircraft to the Company for the Company's operation during the remainder of the terms.


[Edited 2015-10-07 09:04:08]
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delimit
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:40 pm

Quoting Mir (Reply 5):
Everyone and their brother knew Republic was having staffing issues, but Delta still decided to renew its contract with them. I don't see how they have much of a leg to stand on here.

?

If Republic signed a contract to provide capacity, they've got all the leg they need.
 
C767P
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:40 pm

Quoting stlAV8R (Reply 2):
Does anyone know who owns the planes S5 flies for DL?

I believe S5 owns them, or at least controls the lease.

Quoting Mir (Reply 5):
Everyone and their brother knew Republic was having staffing issues, but Delta still decided to renew its contract with them.

They still had the option to continue the 145 flying. I am guessing the contract didn't say "be sure to check with us about staffing before you extend a contract with us." I do believe that DL did that to hurt Republic. Even with that it isn't DL's fault Republic can't staff anything.
 
eugdjinn
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:44 pm

Quoting ty97 (Reply 4):
This has the potential to actually cut both ways for DL. All three legacy majors use Republic and all three (I presume) are impacted to some extent by the pilot issues. If DL were to successfully dump Republic, that would actually help DL's competitors AA and UA to have less of a Republic pilot issue.

And that's the whole point. Republic signed new agreements with American and with United assuming that Delta would let them out of the contract for the E145 flying so that they could take on that new flying. They didn't talk with Delta about it first. They didn't go to Delta to inquire about new Delta flying and they did nothing to safeguard the Delta flying they already had contracted for, they just took the chance and hoped.

Which is why Delta, watching Republic overreach, and knowing that what Republic was really saying was, 'We value these new relationships more than our established relationship with Delta which we are confidant we can take for granted, have now put our company in an untenable position..." promptly enacted the poisonous clause in the E145 contract. That clause, you ask? Simply this, its extension was at Delta's sole discretion, and not subject to Republic's control. And so, with a simple notification that Delta had chosen to hold Republic to the terms of that contract and would be extending the contract at the specified terms for the length allowed... Republic found itself well and truly screwed.

Had Bedford now done the honorable thing and gone to United and American to apologize for overreaching, reduced the schedules there and made good on his contract requirements with Delta, he might have survived this. But no, he chose to prioritize the sexy flying of E170/E175s and ignored the fact that Delta will most happily dismantle his company, his life and his home.

This is far from a surprise, this is the next logical step in a series of tragic consequences brought on by the arrogance of the Republic leadership, nothing more, nothing less. It isn't Delta being evil, it is Delta holding a contractor to the terms of its agreements and reminding them that honoring a relationship with a partner is not only good practice, it's good business.
 
stlAV8R
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 3:46 pm

It appears according to the provisions that S5 or its parent owns all the DL operated a/c. I'm sure Trans States is watching this closely. I'm sure they would love to get their hands on the flying and haven't had much trouble in the recruiting department. Question is, does DL want to keep the 31 E145s around after May 2016? I'm not entirely too sure about their 50-seat a/c reduction. Is it complete? Also, what would happen to the 14 E170s and the additional 9 they have agreed to operate? It looks like DL is at a point to where they can walk away and have the cash to take on the E145s and E175s but the E170s aren't as easy to get out of.

It's also important to note that DL may be taking the court system route as to not be subjected to take on the E145s or any a/c for that matter as the agreement between DL and S5 basically put DL in a position to take the burden off of S5's hands.

[Edited 2015-10-07 08:49:46]
 
INFINITI329
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:03 pm

Quoting stlAV8R (Reply 2):

I wonder how long it will take before they take the same action as they did with YV/F8. I'm sure they would love to rebid this contract out to other carriers for less.

Does anyone know who owns the planes S5 flies for DL? Are they owned by DL and leased to S5 or are they owned by Rebublic?

I don't know who is available to fill S5 shoes.


I ran couple of S5 regs through the FAA database, (please correct me if I am wrong) but I think S5 owns the all or the vast majority of their fleet. Everything I ran came back as S5 owning the airplanes.
 
Mir
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:08 pm

Quoting delimit (Reply 8):
If Republic signed a contract to provide capacity, they've got all the leg they need.

If someone offers to paint your house in an hour, despite that clearly being unrealistic, you're going to have a hard time taking them to court over it. There's got to be some due diligence done on the part of both parties.

Quoting C767P (Reply 9):
I do believe that DL did that to hurt Republic. Even with that it isn't DL's fault Republic can't staff anything.

If there's malicious intent on the part of Delta, the suit shouldn't go very far.

-Mir
7 billion, one nation, imagination...it's a beautiful day
 
delimit
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:14 pm

Quoting Mir (Reply 13):
If someone offers to paint your house in an hour, despite that clearly being unrealistic, you're going to have a hard time taking them to court over it. There's got to be some due diligence done on the part of both parties.

Bad analogies are bad. Republic overextended themselves after signing the contract. How is Delta responsible for that?
 
stlAV8R
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:18 pm

Quoting Mir (Reply 13):
If someone offers to paint your house in an hour, despite that clearly being unrealistic, you're going to have a hard time taking them to court over it. There's got to be some due diligence done on the part of both parties.

The due diligence is there. This isn't a fly-by-night startup carrier who promised the world. This is a proven airline that has operated for DL for over 10 years. Yes I agree that DL was probably aware of the situation at hand but I'm sure they turned a blind eye to it as S5 probably promised to fix it and now they're pissed it's not fixed.

Quoting Mir (Reply 13):
If there's malicious intent on the part of Delta, the suit shouldn't go very far.

S5 is a historically sound carrier operationally but DL is known to be harsh when it comes to not getting what it paid for. I think this is more of a case where DL doesn't and can't tolerate a lot of bad performance. I'm sure they would like to include DL connection in their agreements with businesses about it's guarantees and this is a reason they don't. It's bad for business no matter who is at fault and the shareholders won't care when people start running from DL or when their marketing blitz blows up in their face over situations like this.
 
MSPNWA
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:26 pm

What's sad/ironic about this lawsuit is that DL and the other legacies are primarily to blame for the struggles of the regionals to properly staff their planes. The legacies want it both ways. They want to play them against each other for dirt cheap contracts that line their pockets but don't allow the regionals to pay an attractive wage. And then they'll demand that the regionals act and perform as if they were mainline. It probably is S5's "fault" for not living up to the deal, but suing them is like being a whining child that didn't get all he wanted.
 
Mir
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:35 pm

Quoting delimit (Reply 14):
Republic overextended themselves after signing the contract.

But before Delta renewed theirs. They had the option to walk away in the face of clear evidence that Republic might not be able to meet their staffing requirements. They could have brought some of their own 50-seaters out of the desert and replace the E145 flying with Endeavor CRJ-200s. Instead, they decided to punish Republic for daring to do business with other carriers. I don't have a lot of sympathy for them.

Quoting stlAV8R (Reply 15):
Yes I agree that DL was probably aware of the situation at hand but I'm sure they turned a blind eye to it as S5 probably promised to fix it and now they're pissed it's not fixed.

If you've been following the regional industry for the past few years, it has been blindingly obvious that Republic can't attract the pilots they need. You'd have to be very blind to turn a blind eye to that, and Delta is not that stupid.

Quoting MSPNWA (Reply 16):
The legacies want it both ways. They want to play them against each other for dirt cheap contracts that line their pockets but don't allow the regionals to pay an attractive wage. And then they'll demand that the regionals act and perform as if they were mainline.

  

-Mir
7 billion, one nation, imagination...it's a beautiful day
 
DiamondFlyer
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:36 pm

My personal opinion is, Delta knew this was going to happen when they renewed the S5 E145 contract this spring and planned on doing this. Personally, I think they will end up dumping the S5 145's and deciding to move the flying to other regional partners who aren't having the staffing problems (like 9E and OO) and moving it on to CRJ200's they can get back out of the desert quickly.

-DiamondFlyer
From my cold, dead hands
 
delimit
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:37 pm

Quoting Mir (Reply 17):
But before Delta renewed theirs. They had the option to walk away in the face of clear evidence that Republic might not be able to meet their staffing requirements. They could have brought some of their own 50-seaters out of the desert and replace the E145 flying with Endeavor CRJ-200s. Instead, they decided to punish Republic for daring to do business with other carriers. I don't have a lot of sympathy for them.

They extension was covered by the terms of the original contract. It was entirely Republic's responsibility to plan for that.
 
32andBelow
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:49 pm

Quoting delimit (Reply 8):
?

If Republic signed a contract to provide capacity, they've got all the leg they need.

Except I'm sure that they are only be payed per departure. So DL is not overpaying for what they are getting.
 
ridgid727
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 4:58 pm

I guess they can sue away, put another of their so called "partners" under. DL is no better, remember COMAIR and how they ruined it Maybe DL has a gaggle of pilots to fill in and do their 100% no cancellation , and mislead the public. Connections carriers are Delta when the going is good, but let anything happen, and they call it another airline and distance mother Delta from them..
 
flyingcat
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 5:02 pm

They sued Mesa back in the day, they are probably using a lawsuit as a smokescreen to get out of the contract. Don't know why they renewed maybe they did not have a backup then that they now have lined up.
 
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adamblang
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 5:03 pm

So does Republic pull staffing from AA and UA to cover DL since DL is making the biggest stink?
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delimit
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 5:05 pm

Quoting 32andBelow (Reply 20):
Except I'm sure that they are only be payed per departure. So DL is not overpaying for what they are getting.

What they are getting is a partner flying under the Delta name that is unable to meet the standards they are striving for.

Quoting ridgid727 (Reply 21):
I guess they can sue away, put another of their so called "partners" under. DL is no better, remember COMAIR and how they ruined it Maybe DL has a gaggle of pilots to fill in and do their 100% no cancellation , and mislead the public. Connections carriers are Delta when the going is good, but let anything happen, and they call it another airline and distance mother Delta from them..

This is incoherent. Delta is obviously very concerned with completion. So when a partner is cancelling a huge number of flights you would expect Delta to act, because that's consistent with their goal of running a dependable operation.
 
ty97
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 5:06 pm

Quoting adamblang (Reply 23):

So does Republic pull staffing from AA and UA to cover DL since DL is making the biggest stink?

I am not a lawyer, but I would expect AA and/or UA to file their own suits if that happened.
 
stlAV8R
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 5:07 pm

Quoting Mir (Reply 17):
But before Delta renewed theirs. They had the option to walk away in the face of clear evidence that Republic might not be able to meet their staffing requirements. They could have brought some of their own 50-seaters out of the desert and replace the E145 flying with Endeavor CRJ-200s. Instead, they decided to punish Republic for daring to do business with other carriers. I don't have a lot of sympathy for them.

I think you're thinking to hard into this. They also wanted to remove as much 9E flying as they could.

Quoting Mir (Reply 17):
If you've been following the regional industry for the past few years, it has been blindingly obvious that Republic can't attract the pilots they need. You'd have to be very blind to turn a blind eye to that, and Delta is not that stupid.

Again, DL is not being stupid. If anybody is being stupid, it's S5. They shouldn't bid for and accept a contract that they can't fulfill. S5 falsely presented themselves as an able and willing carrier. Not DL's fault.
 
StrandedAtMKG
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 5:07 pm

Quoting stlAV8R (Reply 2):
I'm sure they would love to rebid this contract out to other carriers for less.

On the one hand, I get it. On the other hand, if Republic can't make these flights work and pay pilots enough to make it worth it to actually become a pilot, how is another carrier supposed to do this for less? The whole point is that the pilot labor market is undergoing a rebalancing because becoming a pilot isn't economically viable right now. Wages are going to have to be pushed up or the shortage will just continue and get worse.
 
FlyASAGuy2005
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 6:55 pm

Don't underestimate DL even if it seems like its clear on the RP side. Remember Freedom? They sued them for sn almost identical case and won. Everyone thought DL was full of balony and the case wouldn't go anywhere.
What gets measured gets done.
 
stlAV8R
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 7:07 pm

Quoting FlyASAGuy2005 (Reply 28):
Don't underestimate DL even if it seems like its clear on the RP side. Remember Freedom? They sued them for sn almost identical case and won. Everyone thought DL was full of balony and the case wouldn't go anywhere.

        
 
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LAXintl
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 8:17 pm

RAH says its not in breach of Delta Connection capacity agreements.

Republic Airways Holdings Inc. is Aware of Delta’s Complaint, Confirms It is Not in Breach
http://finance.yahoo.com/news/republ...-holdings-inc-aware-133800719.html

=
From the desert to the sea, to all of Southern California
 
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northwestEWR
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 8:48 pm

Quoting eugdjinn (Reply 10):

Quoting ty97 (Reply 4):
This has the potential to actually cut both ways for DL. All three legacy majors use Republic and all three (I presume) are impacted to some extent by the pilot issues. If DL were to successfully dump Republic, that would actually help DL's competitors AA and UA to have less of a Republic pilot issue.

And that's the whole point. Republic signed new agreements with American and with United assuming that Delta would let them out of the contract for the E145 flying so that they could take on that new flying. They didn't talk with Delta about it first. They didn't go to Delta to inquire about new Delta flying and they did nothing to safeguard the Delta flying they already had contracted for, they just took the chance and hoped.

Which is why Delta, watching Republic overreach, and knowing that what Republic was really saying was, 'We value these new relationships more than our established relationship with Delta which we are confidant we can take for granted, have now put our company in an untenable position..." promptly enacted the poisonous clause in the E145 contract. That clause, you ask? Simply this, its extension was at Delta's sole discretion, and not subject to Republic's control. And so, with a simple notification that Delta had chosen to hold Republic to the terms of that contract and would be extending the contract at the specified terms for the length allowed... Republic found itself well and truly screwed.

Had Bedford now done the honorable thing and gone to United and American to apologize for overreaching, reduced the schedules there and made good on his contract requirements with Delta, he might have survived this. But no, he chose to prioritize the sexy flying of E170/E175s and ignored the fact that Delta will most happily dismantle his company, his life and his home.

This is far from a surprise, this is the next logical step in a series of tragic consequences brought on by the arrogance of the Republic leadership, nothing more, nothing less. It isn't Delta being evil, it is Delta holding a contractor to the terms of its agreements and reminding them that honoring a relationship with a partner is not only good practice, it's good business.

^^^ Nothing worth reading after this post. Thank your sir.

Quoting Mir (Reply 17):
But before Delta renewed theirs. They had the option to walk away in the face of clear evidence that Republic might not be able to meet their staffing requirements. They could have brought some of their own 50-seaters out of the desert and replace the E145 flying with Endeavor CRJ-200s. Instead, they decided to punish Republic for daring to do business with other carriers. I don't have a lot of sympathy for them.

Before Delta renewed the contract which they had a legal and rightful ability to do--Republic signed contracts for new flying under the assumption that Delta wouldn't renew. Delta renewed and now Republic is failing to meet the terms of Delta's agreement. That's an easy court case and Republic will lose.

Quoting delimit (Reply 19):
They extension was covered by the terms of the original contract. It was entirely Republic's responsibility to plan for that.

   And they decided to roll the dice. It didn't work. Such is life.

Quoting DiamondFlyer (Reply 18):
My personal opinion is, Delta knew this was going to happen when they renewed the S5 E145 contract this spring and planned on doing this. Personally, I think they will end up dumping the S5 145's and deciding to move the flying to other regional partners who aren't having the staffing problems (like 9E and OO) and moving it on to CRJ200's they can get back out of the desert quickly.

There are issues with that plan--I'm not sure the CRJ-200s in the desert are able to be flown again. A lot of them are being harvested for parts to keep the rest flying. It would also take time and be expensive. Delta likes neither of those things.

Quoting adamblang (Reply 23):
So does Republic pull staffing from AA and UA to cover DL since DL is making the biggest stink?

I'd be shocked if they could do that legally but from a practical standpoint, they can't retrain a bunch of EMB-170/175 guys to the ERJ overnight and the pilots probably wouldn't want anyway.

Quoting delimit (Reply 24):
What they are getting is a partner flying under the Delta name that is unable to meet the standards they are striving for.

And they're paying for.

Quoting ty97 (Reply 25):
I am not a lawyer, but I would expect AA and/or UA to file their own suits if that happened.

Absolutely. If the shoe was on the other foot and AA was getting screwed, they'd sue too. Delta is just trying to protect it's contract.

Quoting stlAV8R (Reply 26):
Again, DL is not being stupid. If anybody is being stupid, it's S5. They shouldn't bid for and accept a contract that they can't fulfill. S5 falsely presented themselves as an able and willing carrier. Not DL's fault.

  

Quoting FlyASAGuy2005 (Reply 28):
Don't underestimate DL even if it seems like its clear on the RP side. Remember Freedom? They sued them for sn almost identical case and won. Everyone thought DL was full of balony and the case wouldn't go anywhere.

   The Delta legal team is second to none. I wouldn't want to tangle with those guys.

Quoting LAXintl (Reply 30):

RAH says its not in breach of Delta Connection capacity agreements.

Republic Airways Holdings Inc. is Aware of Delta’s Complaint, Confirms It is Not in Breach
http://finance.yahoo.com/news/republ....html

......Obviously and that's why they're suing. Republic says one thing, Delta disagrees, the court will decide.
Northwest Airlines - Now You're Flying Smart
 
DiamondFlyer
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 8:54 pm

Quoting northwestEWR (Reply 31):
There are issues with that plan--I'm not sure the CRJ-200s in the desert are able to be flown again. A lot of them are being harvested for parts to keep the rest flying. It would also take time and be expensive. Delta likes neither of those things.

There are hundreds of them out there, I'm sure they can find 30 of them that could go right now. Where has 9E pulled the last few they got out of the desert from? They had to have come from somewhere.

-DiamondFlyer
From my cold, dead hands
 
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par13del
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 9:09 pm

Quoting Mir (Reply 5):
Everyone and their brother knew Republic was having staffing issues, but Delta still decided to renew its contract with them. I don't see how they have much of a leg to stand on here.
Quoting stlAV8R (Reply 15):
The due diligence is there.
Quoting stlAV8R (Reply 15):
Yes I agree that DL was probably aware of the situation at hand but I'm sure they turned a blind eye to it as S5 probably promised to fix it and now they're pissed it's not fixed.

So is turning a blind eye due diligence?

Honestly, I would love for Republic to get some backing and offer some salaries and benefits to entice some mainline F/O's to leave, gosh that would fun to see, dreaming I know but.... 
 
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northwestEWR
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 9:20 pm

Quoting DiamondFlyer (Reply 32):
There are hundreds of them out there, I'm sure they can find 30 of them that could go right now. Where has 9E pulled the last few they got out of the desert from? They had to have come from somewhere.

And that may be true but who owns all of those? Delta owns a bunch but most of those are Ex-Comair and Ex-ExpressJet and in rough shape. Maybe 9E has a few more they can pull, I don't know. OO?
Northwest Airlines - Now You're Flying Smart
 
stlAV8R
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 9:28 pm

As far as the E145s are concerned, we can't forget that if DL just walks away, S5 can and most certainly will invoke a clause in their contract (an excerpt is above) that can force DL to take the planes with them. Now, some might argue that taking the planes is not a bad thing but as far as S5 is concerned, they don't want planes that aren't flying and it's the easiest way to stave off bankruptcy. Honestly, based on the terms listed above, if DL wanted to walk away they could but there are strings. I believe the lawsuit is to cut the strings. I don't really think it's about how to replace the planes. If it is really about the planes they can force S5 to give them up (as per the terms listed above) and take them to another carrier. I'm sure Hulas Kanodia over at AX and family will gladly take them in for less. That's his MO.
 
BMcD
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 9:39 pm

That had to be one of the most pointless press releases I've seen in awhile. We checked, we are in compliance! Republic is in a bad spot as are all the regionals. I just hope that they can pull out of it (as in the entire regional industry) and right the ship. I don't wish any illwill to any regional, they just signed a bad contract.
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flyDTW1992
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 11:26 pm

I feel the need to point out that Republic's decision to wind down E145 flying prior to the extension was not as foolish or ill-thought out as many are tending to make it out to be.

It was a multi-year, long term strategic draw down that involved AA, CO/UA, and DL flying. E145s had been being parked for several years, and DL was sitting back and saying "sure, by 2015 we'll be fully prepared to draw down all 50-seat flying"

Everybody at RAH was under the impression nobody wanted those E145s, internally and externally. The pilots were going to E175 training, the planes were being leased out one by one, and hangars were being modified at CHQ bases for E175 work.

Not to mention, the CHQ certificate was eliminated completely to prep for an all-E175 fleet across YX and S5.

This was NOT a surprise to Delta, and they could have easily notified RAH of their intent far, far earlier, avoiding any catastrophic results.

I'm not speaking ardently for or against the leadership as I was employed there and may very will be again in the future, but I simply felt I had to bring up some of these points. Nobody at Republic saw it as a gamble: The focus on 75-seat flying was a) a fairly sound strategic decision in the face of the overall industry trends b) expected to advance RAH's position as a premier E175 operator, being the first US customer for the type and having a very solid operational and MX infrastructure for the E Jets.

That said, I understand the lack of proper recourse within the contract is a serious oversight that wound up being a gamble, I just don't agree with it being a grossly incompetent or intentionally risky course of action by leadership, rather an (relatively speaking) honest mistake in a rather difficult situation.

[Edited 2015-10-07 17:24:45]
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SunsetLimited
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 11:30 pm

Trust me, RAH has issues that go well beyond DL. Take a look at American Eagle flights operated by Republic. Numerous cxld flts due to crew issues on a daily basis. RAH, in my experience, is one of the least reliable regional carriers.
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wjcandee
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RE: Delta Suing Republic Over Canceled Flights

Wed Oct 07, 2015 11:56 pm

Republic could easily have gone to Delta and arranged for a written termination of deltas right to renew the agreement. That's what any sensible person would do before putting oneself the position that they found themselves. This was a gamble that they lost.
 
ty97
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 12:10 am

Quoting SunsetLimited (Reply 38):

Trust me, RAH has issues that go well beyond DL. Take a look at American Eagle flights operated by Republic. Numerous cxld flts due to crew issues on a daily basis. RAH, in my experience, is one of the least reliable regional carriers.

Leaving the Delta lawsuit and it merits/facts to the side for minute, you are absolutely right that RAH has staffing issues that are impacting their ability to staff committed flying for partners. They even said so (in July I think) and their stock got hammered.
 
B757capt
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 12:18 am

Quoting wjcandee (Reply 39):

I said this exact statement in another thread and I caught a ton of hell for it. I complete agree with you!
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INFINITI329
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 12:25 am

Quoting flyDTW1992 (Reply 37):

I feel the need to point out that Republic's decision to wind down E145 flying prior to the extension was not as foolish or ill-thought out as many are tending to make it out to be.

It was a multi-year, long term strategic draw down that involved AA, CO/UA, and DL flying. E145s had been being parked for several years, and DL was sitting back and saying "sure, by 2015 we'll be fully prepared to draw down all 50-seat flying"

RAH should gotten a contract amendment to void the extension clause. not going by hearsay by DL. No way RAH wins
 
DTWPurserBoy
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 12:56 am

Quoting Mir (Reply 5):
Everyone and their brother knew Republic was having staffing issues, but Delta still decided to renew its contract with them. I don't see how they have much of a leg to stand on here.

The contract has to have certain performance parameters regarding completion and 10% is probably well above the magic number.

DL needs to be able to rely on their affiliates and if they can't meet the contract it is time to rebid the contract elsewhere. There are several good alternatives out there. DL could care less about their staffing issues--they need the planes to FLY!
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toobz
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 1:09 am

If DL feels Republic has breached their contract, of course DL should sue. Some people are too emotional when it comes to corporations..
 
C767P
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 1:32 am

Quoting DTWPurserBoy (Reply 43):
DL needs to be able to rely on their affiliates and if they can't meet the contract it is time to rebid the contract elsewhere. There are several good alternatives out there.

Good luck to Delta on rebidding the flying...Perhaps they can give G7 some more, they have the worst performance among DCI carriers and recently received CR9 flying.

If staffing isn’t an issue at a regional today, it will be soon. Not a single regional out there can take S5’s feed.
 
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northwestEWR
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 1:46 am

Quoting flyDTW1992 (Reply 37):
That said, I understand the lack of proper recourse within the contract is a serious oversight that wound up being a gamble, I just don't agree with it being a grossly incompetent or intentionally risky course of action by leadership, rather an (relatively speaking) honest mistake in a rather difficult situation.

I think it's somewhere in the middle. There's no way somebody didn't bring up the Delta extension issue. And I'm sure everyone thought it would be fine so they rolled the dice. It's worth noting that I think most regionals, given the same circumstances, would probably act similarly and it could've worked fine if Delta chose not to renew but it didn't. Sh*t happens.

Quoting wjcandee (Reply 39):
Republic could easily have gone to Delta and arranged for a written termination of deltas right to renew the agreement. That's what any sensible person would do before putting oneself the position that they found themselves. This was a gamble that they lost.

They absolutely should have done this.

Quoting toobz (Reply 44):
If DL feels Republic has breached their contract, of course DL should sue. Some people are too emotional when it comes to corporations..

              

Quoting C767P (Reply 45):
If staffing isn’t an issue at a regional today, it will be soon. Not a single regional out there can take S5’s feed.

I actually agree with you which is why I'm not sure what the Delta strategy is here. If they push Republic under, it'll take at least a year for anybody else to replace that capacity, during which, the Delta Connection network will be a mess. That's IF someone can even take all of the flying. It may need to be multiple carriers.

I'm not sure what their plan is but clearly they felt the need to pursue legal action.
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wjcandee
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 2:29 am

Quoting B757capt (Reply 41):
I said this exact statement in another thread and I caught a ton of hell for it. I complete agree with you!
Quoting infiniti329 (Reply 42):
RAH should gotten a contract amendment to void the extension clause. not going by hearsay by DL. No way RAH wins

Completely agree with both of you.

The reason that you don't go to DL and ask to amend the contract to terminate the right to extend is that most businesses would want something in return for giving up that right. Which is fair. But you don't want to give something in return if you are convinced that they are going to let the flying lapse anyway. But if you proceed on the assumption that it's going to lapse, you do so at your peril. If you whack the Delta bees' nest by taking on new flying from other airlines, taking your current customer for granted and leaving them with a stick to use against you...they're going to use it and they did. This appears not only to be a lost gamble but also just dumb strategy.

All the talk from many posters about "due diligence" is incorrect. DL had an existing contract that gave it an option to extend. It has to do no due diligence as to Republic's ability to perform before exercising that option. It is up to Republic to be ready to perform or, as I said above, to go to Delta and negotiate a termination of the option in advance. Republic probably can't be compelled actually to do the E145 flying, but if they fail to do so they will owe DL money damages, most likely the extra cost to Delta to obtain substitute service, if that is possible, or if it is impossible, the lost profit to DL from being unable to service those passengers. And that's what you sue for.

EDIT: Just read the article linked by the OP: "Delta is seeking damages, including loss of profits and other costs." There ya go.

[Edited 2015-10-07 19:35:11]

[Edited 2015-10-07 19:38:06]
 
Yakflyer
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 2:45 am

I'm surprised that after 46 replies on one has mentioned what I think the bottom line is for Delta. I don't think Delta was particularly interested in the 50 seat flying provided by Republic. IMHO what drove the contract renewal was Delta would not lose money on the 50 seat flying with present fuel prices and being very aware of the staffing issues at Republic, Delta could disrupt the new E-175 flying Republic contracted for with AA & UA by renewing the contract for 50 seat flying. Delta isn't so interested in having Republic fly 50 seaters for them as they are interested in limiting or disrupting the 175 flying of their main competitors. I don't think Delta is trying to put Republic out of business, but it would hurt the others much more if that happened.

I believe Delta is in very good legal shape and because their contracts were negotiated before the most recent contracts with AA & UA, the Delta contracts will be given superior status in litigation.

The senior management at Delta is amoral and will viscously enforce their contracts and provisions of those contracts if they feel like the other party has in some way wronged them. Delta has completely played Bedford and he never saw it coming.

[Edited 2015-10-07 19:48:05]

[Edited 2015-10-07 19:48:58]
 
flyDTW1992
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RE: Delta Suing Republic Over Canceled Flights

Thu Oct 08, 2015 2:52 am

Quoting northwestEWR (Reply 46):
I think it's somewhere in the middle. There's no way somebody didn't bring up the Delta extension issue. And I'm sure everyone thought it would be fine so they rolled the dice. It's worth noting that I think most regionals, given the same circumstances, would probably act similarly and it could've worked fine if Delta chose not to renew but it didn't. Sh*t happens.
Quoting northwestEWR (Reply 46):
They absolutely should have done this.

Yeah, can't argue with you there.

The sad part is, apart from these (glaring) staffing issues, it's a very solid airline operationally. Won't find a better Embraer RJ maintenance organization, very professional people in flight ops and safety. If it weren't for these frankly ridiculous labor and staffing issues, I'd recommend them to anyone if they had to pick a regional carrier.

Hopefully that ends up being what keeps them afloat, and if they come out a leaner, but more pilot-friendly airline, they can get back to their potential of being a top regional carrier.
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