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(Chicago Trib)   American Airlines ordered to justify the $20 million severance given to their CEO. "Because he asked for it" apparently wasn't a good enough explanation   (chicagotribune.com) divider line 216
    More: Followup, American Airlines, executive directors, Americans, AMR Corp., unsecured creditors, United States bankruptcy court, US Airways Group, explanations  
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14413 clicks; posted to Business » on 18 Mar 2013 at 11:44 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-03-18 01:25:29 PM  

tenpoundsofcheese: Ctrl-Alt-Del: tenpoundsofcheese: Elandriel: Chapter 11 nulls all existing contracts

No, that is wrong.

It's close enough to correct that you look like an ass trying to argue against it

The term executory contract assumes a specialized meaning in some areas of law. In bankruptcy law, an executory contract is a contract in which continuing obligations exist on both sides of the contract. In this context, a trustee may assume or reject any executory contract or unexpired lease subject to court approval. [1] See e.g. 11 U.S.C. § 365.

And the contract was accepted when the merger was closed.
Now they want to re-negotiate it.


What was accepted or rejected during the merger is irrelevant to whether or not the trustee can, or does NULL the contract during the bankruptcy.

Good lord, do you need help tying your shoes, too?
 
2013-03-18 01:27:32 PM  

m00: sdd2000: April Bond: He needs that $20 million to replace the cracked leather seats in his personal Learjet.  How is he going to fly his friends to the Superbowl when the leather seats in it are cracked?

At that persons level it would not be a Lear, more likely a Gulfstream, Lears are for the barely making it crowd

Wow you are right. Lear is barely an upgrade from 1st class.

Lear
[www.jet-time.net image 640x515]

gulfstream
[www.aircraftinvestmentgroup.com image 500x333]

Makes having a Lear as your personal jet pretty embarrassing.


I think if I was an AA CEO I would just turn one of the big boys into a cruise ship in the sky.
 
2013-03-18 01:28:10 PM  

mizchief: The goal of a Union is to make the Union stronger, not to increase the well-being of the individual worker. The benefits a Union provides are just placates to keep the workers working and as ubiquitous as possible so that as many workers are kept on the payroll as possible and the dues keep flowing in.


Yeah, unions just get in the way of companies which would otherwise shower their employees with great benefits and high pay.
 
2013-03-18 01:29:06 PM  

jaytkay: DubtodaIll:  what's the point of being outraged about the fiscal operations of a corporation?l.

It's a public corporation. The shareholder's money is being used for the private benefit of a few board members and top executives who loot the company.

It's a bankrupt corporation. It's assets belong to the the creditors. Not the for the private benefit of a few board members and top executives who loot the company.

It's a merging corporation. By reducing the airline industry to a few very large players, it allows a near-monopoly in many markets, meaning it can extract unwarranted high fares from a captive audience.


It's also indicative of the poor attitude the people running these businesses. If the corporation I work for goes down the tubes because of poor management, that's a problem for me. If the management is poor because they don't need to care if it's good or not, that's a problem for me. So, yes, I do care about the fiscal operations of corporations, because they affect my life.
 
2013-03-18 01:29:54 PM  
I have employees ask for a raise with basically that same logic all the time. Does not mean they get it though.
 
2013-03-18 01:30:07 PM  
Guy needs a -

meme
 
2013-03-18 01:31:23 PM  

Ctrl-Alt-Del: tenpoundsofcheese: Ctrl-Alt-Del: tenpoundsofcheese: Elandriel: Chapter 11 nulls all existing contracts

No, that is wrong.

It's close enough to correct that you look like an ass trying to argue against it

The term executory contract assumes a specialized meaning in some areas of law. In bankruptcy law, an executory contract is a contract in which continuing obligations exist on both sides of the contract. In this context, a trustee may assume or reject any executory contract or unexpired lease subject to court approval. [1] See e.g. 11 U.S.C. § 365.

And the contract was accepted when the merger was closed.
Now they want to re-negotiate it.

What was accepted or rejected during the merger is irrelevant to whether or not the trustee can, or does NULL the contract during the bankruptcy.


Wrong.  The contract was already assumed under the bankruptcy.
 
2013-03-18 01:31:49 PM  
wonderpodonline.com
such a message it took two to get here
 
m00
2013-03-18 01:32:21 PM  

mizchief: I think if I was an AA CEO I would just turn one of the big boys into a cruise ship in the sky.


Harder to land on the airstrip that comes with your private villa. I mean, with only 20 million dollar golden parachute money you're not going to become a billionaire and get to live on a private island with a full-sized private airport.

You have to really feel for these CEOs. At a measly 20 million dollars here and there, they're like the 99% of the 1%.
 
2013-03-18 01:36:41 PM  
Don't like it? Don't fly AA then. Really not that complicated.
 
2013-03-18 01:39:15 PM  

Alonjar: CeroX: Here's an idea:

20 Million golden parachute

Divided by:

Non-management employees 79,444

=

251.74 bonus check to all the employees... is it much? not really. Did they earn it? you bet...

Another interesting way to look at it, is that 80,000 people did $250 worth of work just to  pay one guy for losing his job.


Probably an average of two days work for each of them.

And the other problem with all this is if you did give a $250 bonus to every employee, the total taxes collected on those $250 checks would FAR outweigh what this clown will ever pay on his $20 million greasing.
 
2013-03-18 01:41:26 PM  

Marcintosh: [wonderpodonline.com image 500x459]
such a message it took two to get here


"Your soul $20M is MINE!"

// awesomely bad flick
// Sonya Blade = Ms Veronica Vaughan (a fine piece of ayess)
 
2013-03-18 01:42:32 PM  

The Gordie Howe Hat Trick: Don't like it? Don't fly AA then. Really not that complicated.


Don't you mean, "Don't like it? Retroactively don't loan money to AA, then."
 
2013-03-18 01:47:13 PM  

Dr Dreidel: // Sonya Blade = Ms Veronica Vaughan (a fine piece of ayess)


Trust me... I know from experience dude!
 
2013-03-18 01:49:05 PM  

Great_Milenko: Probably an average of two days work for each of them.

And the other problem with all this is if you did give a $250 bonus to every employee, the total taxes collected on those $250 checks would FAR outweigh what this clown will ever pay on his $20 million greasing.


Assuming two days work for each of them, that means his severance package cost 640 years of labor.  Or 16 people had to dedicate their entire lives (40 year career) just to cover his severance.
 
2013-03-18 01:50:17 PM  

Weaver95: MindStalker: A Shambling Mound: Sure, it was in his contract. I can guarantee you if there were a couple hundred soon to be laid-off run-of-the-mill employees who had clauses like that in their contracts (likely collectively equalling a whole lot less than $20 million) the company would be falling all over themselves trying to find ways to invalidate those contracts.

I'm sure they've already succeeded invalidating most employees PTO payouts and the like.

Well of course! Agreements with little people arent 'for realz'. Only contracts with the elite are binding, and only when it benefits the already super rich.


encrypted-tbn1.gstatic.com
 
2013-03-18 01:51:20 PM  

Killer Cars: In fairness, there are a lot of knockoffs on the market. To the untrained eye and touch, it's very hard to differentiate between the high quality blue whale foreskin leather, and a cheap replacement such as sloth taint leather, which South American crime orgs flooded into the marketplace during the late 90's.



I got burned by that myself. Protip: Don't buy your whale dong leather from a guy named Rodrigo who does business out of a Del Taco.


My Corolla just looks ridiculous now.
 
2013-03-18 01:51:24 PM  

BMFPitt: CeroX: Here's an idea:

20 Million golden parachute

Divided by:

Non-management employees 79,444

=

251.74 bonus check to all the employees... is it much? not really. Did they earn it? you bet...

So you're fine with ripping off the people who are owed money, you just want to change who gets it?


Ripping off the workers is fine, in other words. You just want to change who gets paid to the investors.
 
2013-03-18 01:53:40 PM  

April Bond: He needs that $20 million to replace the cracked leather seats in his personal Learjet.  How is he going to fly his friends to the Superbowl when the leather seats in it are cracked?


I hear he tried saddle soap and it didnt work so he had to put towels down.....TOWLS FFS!!
 
2013-03-18 01:55:04 PM  
i172.photobucket.com
 
2013-03-18 01:56:42 PM  
And the rich wonder why we disapprove of them....
 
2013-03-18 01:56:55 PM  
tenpoundsofcheese (farkied: It ain't cheese): CeroX:

There ya go CEO, a company build on the backs of the employees and you "earned" your bonus... the same as everyone else...

Are you saying the current employees built the company?  I didn't know the company was that new.  Looks like they didn't do a very good job at building it since it is in bankruptcy.


Remember, boys and girls:

* If a company does well, the credit belongs to the CEO and the board of directors.
* If a company does poorly, the blame goes to the rank and file, especially if they're evul Union Thugs.
 
2013-03-18 01:57:27 PM  
His contract became void once it went to bankruptcy court. Renegotiate for half and still walk out a millionaire.

Ta da!
 
2013-03-18 01:59:52 PM  

Dubya's_Coke_Dealer: BMFPitt: CeroX: Here's an idea:

20 Million golden parachute

Divided by:

Non-management employees 79,444

=

251.74 bonus check to all the employees... is it much? not really. Did they earn it? you bet...

So you're fine with ripping off the people who are owed money, you just want to change who gets it?

Ripping off the workers is fine, in other words. You just want to change who gets paid to the investors.


Please elaborate on how you believe they are being ripped off. And creditors != investors.
 
2013-03-18 02:00:20 PM  
The company said the proposed employee arrangements were found to be reasonable by pay consultants retained by its unsecured creditors committee.
It added that the payments would "motivate a strong management team during the integration process" to make the merger a success.


Blah blah blah blah...

Translation: He is part of a hyper rich, do nothing elite class and is thus entitled to huge amounts of money.
 
2013-03-18 02:02:43 PM  
"so they don't get sued" is a great answer

I realize all the grubby proles out there hate this, because $20m is more than they'll ever see. However, if you look at history, the solution to wealth inequality is not to go after the rich, it's to reduce the number of poor.

Keep encouraging welfare babies & illegal immigration, proles.
 
2013-03-18 02:04:14 PM  

m00: sdd2000: April Bond: He needs that $20 million to replace the cracked leather seats in his personal Learjet.  How is he going to fly his friends to the Superbowl when the leather seats in it are cracked?

At that persons level it would not be a Lear, more likely a Gulfstream, Lears are for the barely making it crowd

Wow you are right. Lear is barely an upgrade from 1st class.

Lear
[www.jet-time.net image 640x515]

gulfstream
[www.aircraftinvestmentgroup.com image 500x333]

Makes having a Lear as your personal jet pretty embarrassing.


you may want to put that in terms farkers will remember or appreciate....

Lear:

i.imgur.com

Gulfstream:

3.bp.blogspot.com
 
2013-03-18 02:04:26 PM  

BMFPitt: The Gordie Howe Hat Trick: Don't like it? Don't fly AA then. Really not that complicated.

Don't you mean, "Don't like it? Retroactively don't loan money to AA, then."


Those ATSB grants/loans to the airline industry ended up turning something like a $200 million profit. And that was over ten years ago.

I don't understand people who kvetch constantly about stuff that really doesn't concern them.
 
m00
2013-03-18 02:05:55 PM  

hitlersbrain: Translation: He is part of a hyper rich, do nothing elite class and is thus entitled to huge amounts of money.


Sometimes, I can't wait for the revolution. The shiattier life gets for the rest of us, the less we have to lose.
 
2013-03-18 02:07:06 PM  

sodomizer: Keep encouraging welfare babies & illegal immigration, proles.


DEFUND PLANNED PARENTHOOD!
 
2013-03-18 02:07:16 PM  

m00: hitlersbrain: Translation: He is part of a hyper rich, do nothing elite class and is thus entitled to huge amounts of money.

Sometimes, I can't wait for the revolution. The shiattier life gets for the rest of us, the less we have to lose.


And yet, you are fine with hundreds of millions of your money going to politicians......

make some sense. Only revolution is going to be lazy bastards will eventually need to start working.
 
2013-03-18 02:07:57 PM  

sodomizer: Keep encouraging welfare babies & illegal immigration, proles


Because if this guy doesn't get $20M, he'll just go out and have a few welfare babies and import a thousand illegal immigrants.

Thanks for the tip. Whew, we almost goofed big time!
 
2013-03-18 02:09:21 PM  

mizchief: The Stealth Hippopotamus: I'd have strong words with my Union Rep.

"What the eff are we paying you for? He does all his own negotiations and look what he gets!!"

- Disgruntled Union Member

The goal of a Union is to make the Union stronger, not to increase the well-being of the individual worker. The benefits a Union provides are just placates to keep the workers working and as ubiquitous as possible so that as many workers are kept on the payroll as possible and the dues keep flowing in.


Are Union workers paid more and do they enjoy more benefits than non-union workers? Yes? Well there ya go,
 
2013-03-18 02:09:59 PM  

The Gordie Howe Hat Trick: BMFPitt: The Gordie Howe Hat Trick: Don't like it? Don't fly AA then. Really not that complicated.

Don't you mean, "Don't like it? Retroactively don't loan money to AA, then."

Those ATSB grants/loans to the airline industry ended up turning something like a $200 million profit. And that was over ten years ago.

I don't understand people who kvetch constantly about stuff that really doesn't concern them.


How is that relevant to the unsecured creditors whose $20m is being stolen?
 
2013-03-18 02:10:39 PM  

Phil Moskowitz: Vulture Capitalism is a form of capitalism.


sure
but why arent we shooting the vultures?
they are ugly and spread disease, right ...
 
m00
2013-03-18 02:11:03 PM  

Thunderpipes: And yet, you are fine with hundreds of millions of your money going to politicians......


I am? Where did I say that?
 
2013-03-18 02:14:58 PM  

jaytkay: mizchief: The goal of a Union is to make the Union stronger, not to increase the well-being of the individual worker. The benefits a Union provides are just placates to keep the workers working and as ubiquitous as possible so that as many workers are kept on the payroll as possible and the dues keep flowing in.

Yeah, unions just get in the way of companies which would otherwise shower their employees with great benefits and high pay.


If you aren't being compensated as well as you think you should be, then quit and go get a better job. If the whole industry treats you like shiat, then take some night classes and change industries. If all you can do is biatch and moan and have to get a Union boss to fight for you, then bend over and shell out your dues.
 
2013-03-18 02:16:03 PM  

The Gordie Howe Hat Trick: Don't like it? Don't fly AA then. Really not that complicated.


Except that our government uses my tax dollars to bail these farkers out when they fail.
 
2013-03-18 02:16:08 PM  

BMFPitt: The Gordie Howe Hat Trick: BMFPitt: The Gordie Howe Hat Trick: Don't like it? Don't fly AA then. Really not that complicated.

Don't you mean, "Don't like it? Retroactively don't loan money to AA, then."

Those ATSB grants/loans to the airline industry ended up turning something like a $200 million profit. And that was over ten years ago.

I don't understand people who kvetch constantly about stuff that really doesn't concern them.

How is that relevant to the unsecured creditors whose $20m is being stolen?


Is he stealing it from you? Did he use a gun?

It was negotiated with the board. If it doesn't pass muster, the bankruptcy judge will stop it. Again, why would you care unless you were a shareholder or employee? If that's the case, direct your ire at the BoD.

Or keep kvetching, it's up to you.
 
2013-03-18 02:16:22 PM  

Weaver95: Obviously that man needs a tax cut. Can't have $20 million without a tax cut!


What a good liberal you have become. All delusion of being a libertarian has vanished.
 
2013-03-18 02:17:32 PM  

Nana's Vibrator: DubtodaIll: Aside from allowing yourself to feel morally superior to someone who has been much more successful than you,


You have a myopic way of measuring success. He's a colossal failure in everything except being a douchebag.
 
2013-03-18 02:19:56 PM  

The Gordie Howe Hat Trick: BMFPitt: The Gordie Howe Hat Trick: BMFPitt: The Gordie Howe Hat Trick: Don't like it? Don't fly AA then. Really not that complicated.

Don't you mean, "Don't like it? Retroactively don't loan money to AA, then."

Those ATSB grants/loans to the airline industry ended up turning something like a $200 million profit. And that was over ten years ago.

I don't understand people who kvetch constantly about stuff that really doesn't concern them.

How is that relevant to the unsecured creditors whose $20m is being stolen?

Is he stealing it from you? Did he use a gun?

It was negotiated with the board. If it doesn't pass muster, the bankruptcy judge will stop it. Again, why would you care unless you were a shareholder or employee? If that's the case, direct your ire at the BoD.

Or keep kvetching, it's up to you.



Yes, it was a fairly and objectively negotiated contract by a group of elitist uber rich men who just so happen to be very likely to negotiate for each other on other contracts.   Who could have a problem with this?
 
2013-03-18 02:19:57 PM  
Don't worry Farkers, this poor entitled douchebag will get his money, most likely after some fist shaking and sky ranting by the plebs.   No court, government, or authority in America is going to deny him his rightful suitcase full of cash.
 
2013-03-18 02:20:57 PM  

hitlersbrain: mizchief: The Stealth Hippopotamus: I'd have strong words with my Union Rep.

"What the eff are we paying you for? He does all his own negotiations and look what he gets!!"

- Disgruntled Union Member

The goal of a Union is to make the Union stronger, not to increase the well-being of the individual worker. The benefits a Union provides are just placates to keep the workers working and as ubiquitous as possible so that as many workers are kept on the payroll as possible and the dues keep flowing in.

Are Union workers paid more and do they enjoy more benefits than non-union workers? Yes? Well there ya go,


Only in industries where they have the government to back up their inevitable failure. Otherwise it just becomes and averaging out where the best workers that would be getting even higher salaries because they are fought after by the competing businesses, are instead just split with the knuckle draggers that only work hard enough not to get fired.
 
2013-03-18 02:20:58 PM  
They gave it to him to keep his hands off the non-ruined portion of the company. The investors made it clear he was not to be involved in operations for the merger to happen. The only way to ensure this was to pay the extortion so his ego would be mollified thus saving the company from bankruptcy and attaining their assets.

They would have been better off letting the company fail, buying the liquidated assets and moving on instead of being strong-armed by the pilots/union of the FAILED airline. But they wanted to save the jobs of folks who ran the company into the ground and did so.


/Ear to the scuttlebutt behind the counters.
 
2013-03-18 02:21:04 PM  

mizchief: The Gordie Howe Hat Trick: Don't like it? Don't fly AA then. Really not that complicated.

Except that our government uses my tax dollars to bail these farkers out when they fail.


1. Call your congressman

2. ATSB loans turned a small profit.

I don't think highly of AA's management either. After they cajoled AA's unions into givebacks and concessions in 2004(?), the company turned an annual profit of around $210M, then gave management types $195M in bonuses.
 
2013-03-18 02:22:41 PM  

DubtodaIll: The fact of it is it doesn't need to be justified, it's their money, they can do with it as they please, and they will.


You're entitled to your own opinion, but not your own facts.  In bankruptcy, it's not the company's money any longer, it's the creditor's money.  And they, through the courts, get to decide how it's spent.  Thus, they do need to be prepared to justify it.
 
2013-03-18 02:23:36 PM  

jaytkay: mizchief: The goal of a Union is to make the Union stronger, not to increase the well-being of the individual worker. The benefits a Union provides are just placates to keep the workers working and as ubiquitous as possible so that as many workers are kept on the payroll as possible and the dues keep flowing in.

Yeah, unions just get in the way of companies which would otherwise shower their employees with great benefits and high pay.


Golden showers are a KIND of shower...
 
2013-03-18 02:24:58 PM  

sodomizer: "so they don't get sued" is a great answer

I realize all the grubby proles out there hate this, because $20m is more than they'll ever see. However, if you look at history, the solution to wealth inequality is not to go after the rich, it's to reduce the number of poor.

Keep encouraging welfare babies & illegal immigration, proles.


I'll bite, but only long enough to point out just how farking out of your mind you must be to actually believe anything you just wrote.
 
2013-03-18 02:24:58 PM  

DubtodaIll: Aside from allowing yourself to feel morally superior to someone who has been much more successful than you, what's the point of being outraged about the fiscal operations of a corporation? ...  The fact of it is it doesn't need to be justified, it's their money, they can do with it as they please, and they will.


Aside from you demonstrating a serious lack of understanding that airlines are among the most heavily-subsidized industries on the planet, what's the point of your post?  Airlines get subsidies, tax preferences, and the federal government handles their security at no cost to them, and they still manage to lose billions of dollars every year. The feeling I get when I watch them back a dumptruck full of money to the well-appointed home of yet another failed CEO is more than just "moral outrage," it's goddamn fury at watching an infrastructurally-crucial business that is heavily supported by my tax dollars being run like a private club that I have to pay for but am not allowed to join. And watching simps like you come in here with your grossly-uninformed-yet-still-somehow-patronizing "What's the big deal?" attitude isn't helping my blood pressure, either.
 
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