What happens when Memphis ATC goes down? DFW becomes a huge parking lot.
My thanks to one of our longtime American Airlines‘ pilot readers who snapped this as he arrived in DFW this week. That was after he had taken the long way home to DFW, via Alexandria, LA.
Whew. I think I need a beer.
This has been one busy two days. Thank you to all who have been bombarding me with emails the last couple of days. It’s been like information central around here. That’s great. Just makes it hard to get an issue of PBB out the door!
PlaneBusiness subscribers — you can now access this week’s rather long issue of PlaneBusiness Banter.
Heh. Talk about …rewriting. Whew.
Yes, it’s been a bit active this evening here at the Worldwide Headquarters with all the Mesa news flying around.
As a result, we’re going to post this week’s issue of PlaneBusiness Banter tomorrow.
Talk to you then.
Here we go. Here’s the breaking story at the Star-Bulletin.
Yet another person we know who was there in the courtroom today has sent us a note updating us on today’s events. Yes, the story gets even more bizarre as the days go by.
In reading through the notes it appears that Mesa’s attorney informed the court today that it had possession of two hard drives that were supposedly hidden by Mesa CFO Peter Murnane until 9/13 but only disclosed to Hawaiian attorneys and the court this morning as a basis for the judge not to rule on the motion for sanctions, and to delay ruling on the trial. This goes to the argument that Mesa was trying to show again how they were victimized by their own CFO.
Hawaiian’s attorney Sidney Levinson then apparently pointed out that this stunt was another example of how Mesa was trying to forestall a decision on the motion by only providing evidence to Hawaiian and to the court when it is convenient for them.
Levinson noted that instead of “firing this CFO who was victimizing them,” Mesa put him on paid administrative leave and gave him a “warm pat on the back” in a press release, commending him for his fine work.
Judge Robert Faris denied Mesa attorney Maxwell Blecher’s request not to rule, noting that the discovery deadline had passed and if Mesa could not produce documents that was Mesa’s fault.
Both sides then made their closing arguments to the judge.
Drumroll please.
And as for the judge’s ruling?
Judge Robert Faris ruled today that Mesa Air Group did intentionally destroy evidence that could have been used by Hawaiian Airlines in the lawsuit against its competitor.
Faris also found that Mesa executives made their decision to start a their low fare airline in 2006 based on information they got while looking at Hawaiian’s books — when the airline was still in bankruptcy protection.
The amount being sought by Hawaiian in damages was also disclosed today in court documents. That amount is $173 million.
Hawaiian Airlines is also seeking an injunction that would block Mesa’s interisland carrier, go!, from operating in Hawaii for a year.
Ticker: (Nasdaq:MESA), (AMEX:HA)
Technorati Tags: airline CEOs, Hawaiian Airlines, Mesa Airlines, puppy
Okay all you airline nerds out there. (And you know who you are!)
Here is something that I think is really cool.
MIT’s International Center for Air Transportation and the Global Airline Industry Program is making available to the public a new website hat for the first time collects a comprehensive data set looking at individual carrier and industry trends. The Airline Data Project (ADP) represents an ambitious effort to compile key data for 15 of the largest U.S. airlines.
Why is this so cool?
Because while the information used in this project is all “out there,” this is the first time this information has been put together in a way that is quickly accessible for normal people like you and me. And it goes back to 1995.
Thanks to Bill Swelbar, Research Engineer at MIT, who let us know about this nifty new toy.
I just received a spam email with the subject heading, “Be a Real Man with A Real Penis.”
I wonder if this would pass the Mesa-Porn-at-40-Feet Test?
Ticker: (Nasdaq:Mesa)
In an earlier missive, I said that the entire page of notes that I received from the hearing in Hawaii Wednesday would be published later today on the MesaLies blog.
My bad. That will not be the case.
My apologies for the mix-up. Doing too many things at once today. Post has been duly corrected.
We all knew this was coming when FL Group continued to build its stake in AMR.
Today FL Group said in a statement that “FL Group believes that opportunities remain to unlock shareholder value and that the AMR management team and board of directors should actively pursue all such opportunities. Simply blaming high fuel costs and investor sentiment is not a sufficient response.”
They forgot to mention the weather.
Anyway, we know how this game works. Hedge fund takes stake in airline. Hedge fund increases stake in airline. Hedge fund then starts pushing management to “unlock those assets.” (Kind of like ‘Extreme Makeover’ when they scream “Move that BUS!”)
FL Group now controls 8.25% of AMR shares.
“After taking a close look at the company over an extended period of time, our suggestions include monetizing assets, such as AAdvantage, that can be used to reduce debt or return capital to shareholders,” FL Group CEO Hannes Smarason said in the firm’s missive. “We believe that there is no time to lose given the recent developments in the market place.”
FL Group estimates that spinning off AAdvantage could increase shareholder value by more than $4 billion.
Terry Maxon, with the Dallas Morning News wrote about this today, adding that,
“Credit Suisse airline analyst Daniel McKenzie, in a report Tuesday, estimated that AMR’s ‘noncore holdings’ could bring more than $5.5 billion, compared to AMR’s current market value of $5 billion.
‘Add $5.7B cash to this and you’ve got real value, even if we’re heading into a downturn,’ Mr. McKenzie wrote, referring to AMR’s available cash and short-term investments.
Mr. McKenzie identified the potential targets for spin-offs as AMR’s financial arm, American Beacon Advisors Inc., which runs a family of mutual funds; its regional airline unit, AMR Eagle Holding Corp.; American’s aircraft maintenance and repair operations; and AAdvantage.”
But, but, BUT.
If the airline spins off all this cash — then what is it going to tell its employees about how times are tight, raises are few and far between, and costs must be kept under control?
Same thing United Airlines is going to tell its employees when it starts racking up the bucks by selling off its parts. Only difference is at least American employees still have their pension plans intact.
For now.
Ticker: (Nasdaq:UAUA), (NYSE:AMR)
Technorati Tags: airline CEOs, airline stocks, airline unions, airlines, American Airlines, FL Group, United Airlines
As I am working on this week’s issue of PlaneBusiness Banter today, I am not going to write too much on the ongoing sad and sorry saga that continues to unfold in a Hawaiian courtroom.
However, here is one update for you to peruse. Here is the Honolulu Star-Bulletin’s daily update on the proceedings.
I also received an update from Mike Uslan. You may recall that Mesa sued Uslan, who was involved with the H.E.R.O website (Hawaiian Airline Employees Repelling Ornstein.) In this case, “Hawaiian” referred to the state, not the airline, as Aloha and Hawaiian airline employees were involved in the group.
Keeping that in mind, Mike sent us a pretty long summary of what transpired yesterday in court — penned by a friend of his. According to the report, one could hear the “Darth Vader” theme being hummed by members of the gallery when Mr. Ornstein strode up yesterday to testify.
The notes on the day’s activities continued,
“On day two Mesa finished Pappaianou’s testimony and then presented three witnesses: Mesa’s IT manager, McKay Monson, their V.P./ Chief Info Officer Jeffery Hornberg, and CEO Jonathan Ornstein. I’ll abbreviate the first two witnesses, as J.O.’s testimony outshines anything that they testified to.
Pappaianou testified that he was able to see from 40+ feet away that Murnane was looking at porn, but stated that he took no action against Murnane at the time. [Some in the gallery suggested that we should do a CSI-like porn/ not-porn test from the same distance away in the courtroom. . .]”
The report continues, “There was more testimony from Pappaianou and the other two that basically discredited Mesa’s porn theory and made it quite obvious that the story was concocted recently. For example, the alleged porn that Pappaianou and Hornberg saw Murnane looking at happened in 2004. Since then the next time that Hornberg even thought of it was when he was asked to come and testify, last week. The evidence destruction happened in 2006.”
After Jonathan took the stand, I thought Hawaiian attorneys were right in making the point that there were potential Sarbanes-Oxley issues involving a recent Mesa press release. I had thought the same thing. According to the notes we received, this was the recent press release,
“in which, while stating that Mesa maintains the “highest ethical
standards,” Mesa fails to disclose to shareholders that Mesa’s CFO –the person responsible for public shareholder reports – was facing allegations of destruction of evidence that he was federally-mandated to preserve. J.O. admitted that he had reviewed and approved this press release. J.O. got flustered here and blurted out that they had no responsibility to issue any information at all under NASDAQ rules.Hawaiian then established that in spite of Mesa’s ‘highest ethical standards’ they did nothing in the face of Judge Faris’ ruling that Murnane had lied. Hawaiian attorneys then brilliantly confronted J.O. with the Wall Street Journal article in which J.O. stated that ‘he took exception with the court’s conclusions’. As ‘the court’ was Judge Faris — the very man that J.O. was sitting in front of — this caused a bit of squirming on the Mesa bench.”
Oh boy. Who needs a new TV season when we have entertainment like this every day?
As for Ornstein’s testimony, as well as that of other Mesa employees, well, let’s just say it’s worth more commentary than I have time to give it today.
Ticker: (Nasdaq:MESA), (NYSE:HA)
Technorati Tags: airline CEOs, airlines, Hawaiian Airlines, Mesa Airlines
Cranky’s got a couple of actual Spirit livery photos on his site.
Not sure I like it any better on a real airplane.