COMMITTEE OF CONCERNED MIDWEST FLIGHT ATTENDANTS FOR FAIR AND EQUITABLE SENIORITY INTEGRATION v. INTERNATIONAL BROTHERHOOD OF TEAMSTERS AIRLINE DIVISION (November 30, 2011)
In mid-2009, Midwest Airlines was losing money and in dire financial circumstances. In fact, it had only nine airplanes. Republic Airways Holding purchased Midwest's parent. Within a few months, Republic had given up Midwest’s planes and its federal certificate. It kept its gates and its takeoff and landing slots. It integrated the seniority lists for several kinds of employees but it furloughed Midwest's pilots and flight attendants. Although the flight attendants were eligible to be rehired, the Teamsters Union would assign them new-hire seniority status. Several flight attendants filed suit, contending that the Federal Aviation Act requires Republic to merge the flight attendants' seniority lists. Judge Randa (E.D. Wis.) granted summary judgment to the union. The flight attendants appeal.
In their opinion, Seventh Circuit Chief Judge Easterbrook and Judges Posner and Williams reversed and remanded. The Court turned to the language of the act. It noted that the Act requires seniority list integration when two "air carriers" are "involved" in a "covered transaction." Relying on the statutory language, the Court concluded that Midwest was an "air carrier" because they held a certificate, that Midwest was "involved" in the transaction even though it was its parent that was acquired, and that the transaction was a "covered transaction" because Republic acquired all of Midwest's stock and combined two air carriers into a single carrier. The Court noticed the absence in the Act of any reference to the bankruptcy or financial wherewithal of an air carrier. In fact, the Court added that the statute grew out of the acquisition of Trans World Airlines at the time of its bankruptcy. Congress clearly did not mean to exempt bankrupt air carriers from the Act’s requirements.