APA, CHQ, and the EMB-170

[Cleared Direct]

July 22, 2004


BY FACSIMILE


Mark L. Burdette
Vice President - Employee Relations
American Airlines, Inc.
P.O. Box 619616 MD5624
DFW Airport, TX 75261-9616

Re: Operation of EMB-170 jets by Chautauqua Airlines

Dear Mark:

As you know, for the last several years, Chautauqua Airlines, Inc. has been a regional partner of American Airlines operating pursuant to Section 1.D. of the Scope Clause in our Basic Agreement. On July 13, 2004, Chautauqua filed an application with the Department of Transportation seeking certification to operate EMB 170 aircraft. I understand that Chautauqua intends to utilize these aircraft on behalf of United Airlines beginning in October 2004.


On behalf of the Allied Pilots Association, I want to clearly and forcefully assert that Chautauqua may not utilize the EMB 170 aircraft and continue to operate as a Commuter Air Carrier under Section 1 of our Agreement. The language of the Scope Clause is unambiguous: to be a “Commuter Air Carrier,” an air carrier must utilize “only (a) aircraft that are certificated in the United States and Europe with a maximum passenger capacity of 50 passenger seats or fewer and (b) aircraft that are not certificated in any country with a maximum gross takeoff weight of more than 64,500 pounds.” If Chautauqua operates the EMB-170, then it is no longer a “Commuter Air Carrier” under Section 1.B.4. and, accordingly, is no longer covered by the Section 1.D. Scope exception for “Commuter Air Carriers.”


I request that American immediately clarify its intent to abide by the Agreement. The parties have agreed that any violation of the APA Scope Clause constitutes irreparable injury to American’s pilots. Together, we must avoid the imminent injury threatened by Chautauqua’s apparent intent to cease operating as a Commuter Air Carrier under our Agreement.


I look forward to receiving your prompt assurances.

Sincerely,

Captain Ralph Hunter
President

cc. Edgar N. James. Esq.
APA Negotiating Committee
APA Scope Committee
APA Board of Directors

 

[P38JLightning]

clarify?

The letter was straight forward except for this sentence:

"Together, we must avoid the imminent injury threatened by Chautauqua’s apparent intent to cease operating as a Commuter Air Carrier under our Agreement."

Is the APA simply saying can Chautauqua and their Eagle contract violating whipsaw cancer, or is it saying we're willing to renegotiate the language in our agreement so that you can continue to use them?

"imminent injury"? As in the low bidding portfolio cancer on our industry whereby pilots underbid eachother willing and enthusiasticaly to pay for their own growth and upgrades (PFG and PFU) or as in we don't want AA to lose money if they have to cut out the cancer?

Oh well time will tell. Either way I hope they get the boot from AA. Long time coming.

 

[Indypilot]

Just a quick question


How many and what specific type airplanes (135/140/145) does CHQ operate for american?

Their portfolio consists of UAL,AMR,DAL, and US correct?

 

[ASH]

Yes, we fly the -140 for AA.


I have to disagree about us getting the boot from AA. They are pleased with our product, and we do a great job with the resources given. i.e. incompetent ground crews!

 

[Indypilot]

How many planes do you operate for AA?

 

[surplus1]

I wonder if, in its agreement with AMR, CHQ management agreed to recognize AA Scope?

I thought using the E-170 on the CHQ certificate was a temporary deal until they get the REP certificate. Do you think AA can prevent operation of the E-170, for UAL, on the Republic certificate?

If AMR terminates its contract with CHQ for this reason, it would be nice to see Republic Holidings sue the Allied Pilots Association and file a complaint for violation of the anti-trust laws (restraing of trade) against AMR.

It's one thing when you have scope that controls y our own code share, but it's another thing whey you try to prevent a Company from doing business with somebody else. Hopefully Bedford won't be a wuss and roll over.

 

[lowecur]

According to the prospectus, they operate 15 emb 145's for Eagle. DL and UAIR are their largest clients with thirty something jets apeice. UAL will have close to that amount by the end of the year.

Since the Chautauqua deal is temporary until Republic gets their certificate to fly, I don't see AMR cutting off their nose to spite themselves. If APA wants AMR to enforce the contract it could get ugly as AMR values Chautauqua as a partner.

 

[Indypilot]

Ok, just curious, but I'm assuming the APA is going to play hardball on this one. If that is the case, what are the chances of CHQ management calling the offices of the recently 87 RJ departed United, and transferring the 15 over to United? Do they really NEED 4 code share agreements, or could they be diversified enough with 3, and tell american bye bye? Just thinking out loud.... comments

 

[Saluki Dawg]

I would say that the APA definitely has a case against CHQ or Republic operating these aircraft, as it is a clear violation of their scope clause. CHQ would have been required to sign something stating that they would agree to these terms before being signed on by AMR to do the flying out of STL. Therefore, CHQ knew that they were violating this agreement when they agreed to purchase and fly these 170's for UAL. So, if they want to fly those aircraft for UAL, then they shouldn't still be allowed to fly for AA out of STL, IMHO. Eagle could easily be brought in to take up the slack for CHQ, and should have first dibs to that flying when it does become available.

 

[michael707767]

I would say that the APA definitely has a case against CHQ or Republic operating these aircraft, as it is a clear violation of their scope clause. CHQ would have been required to sign something stating that they would agree to these terms before being signed on by AMR to do the flying out of STL. Therefore, CHQ knew that they were violating this agreement when they agreed to purchase and fly these 170's for UAL. So, if they want to fly those aircraft for UAL, then they shouldn't still be allowed to fly for AA out of STL, IMHO. Eagle could easily be brought in to take up the slack for CHQ, and should have first dibs to that flying when it does become available.

I think that is a great point. The APA scope existed long before CHQ got the E-170, and I do not believe CHQ management did not know about it.

 

[ASH]

I highly doubt that MGMT @ CHQ would do something that would jepordize the AA flying. I think we have 17 -140 dedicated to them right now.

I have not known CHQ mgmt to make wild moves without examining the path first. I think there is more going on behind the scenes than meets the eye right now.
And yes, this is a temporary fix with the 170's on CHQ

 

[bandit110]

But the contract with CHQ was originally signed by TWA. I don't know if it was renegotiated when AMR took over? Maybe the CHQ contract with AMR does not prohibit this while the contract with AMR and APA does. Anyone know the details?

 

[amcnd]

Yes I think that Eagle should take over the 20 E-140 that CHQ as for AX .They are set up the same as Eagles RJ's. 2 honeywell FMS's all the rest of CHQ's aircraft have colins. And while we are at it, Eagle should get the 10 E-145's Trans states is leasing from Eagle.(although they were Eagles oldest aircraft...Dogs..) Just incase in a year TSA dissides to buy some 51+ seat airccraft for there United operation.If this hold up, it will limit the companies that AA uses for there feed to just about Eagle. Anyone like Mesa,Skywest,Wisky,Mesaba,Horizon cant fly for AA. They allready ahve 70 seat aircraft.

 

[Saluki Dawg]

Trust me when I say that AMR absolutely made CHQ re-sign a new agreement after the TWA buyout. This scope language was in the agreement, and CHQ was aware of it. Whether CHQ moves these aircraft over to the Republic operating certificate or not, will probably not change things in the eyes of the APA, since the pilots of CHQ and Republic are flying on the same seniority list. I'm sure CHQ management would disagree, but in this case, I still contend that the APA would probably prevail in court.

 

[cargoflyr69]

I'm still trying to understand this, but when I look at ACA/Indy Air it looks like they have the same issues with their codeshare partner Delta. Don't they loose the dojets as soon as the first bus comes on property this fall? If the scope language is the same at AA and Delta then maybe CHQ will be kicked to the curb.

I do feel strongly that all legacy mainlines needs to keep as much flying on property as possible. I'm getting sick of all the farming out to "regional" airlines. When will it stop?

 

[Indypilot]

"Don't they loose the dojets as soon as the first bus comes on property this fall?"

We do lose the Dojets once revenue service starts on the bus, that should be the beginning of November. I think the delta scope prohibits a regional placing an aircraft OVER 70 seats on the certificate. In this case CHQ won't lose delta because they will be operating the 170 aircraft in a 64 seat configuration (even if it was 70 it would be ok). But as soon as they operate a 71 seat airplane, its a violation of scope. American's scope is different than delta.

I agree with you about the outsourcing and all the scope issues. Thats why we did something about it. Buh buy united and delta whipsaw program......

 

[storminpilot]

July 22, 2004


BY FACSIMILE


Mark L. Burdette
Vice President - Employee Relations
American Airlines, Inc.
P.O. Box 619616 MD5624
DFW Airport, TX 75261-9616

Re: Operation of EMB-170 jets by Chautauqua Airlines

Dear Mark:

As you know, for the last several years, Chautauqua Airlines, Inc. has been a regional partner of American Airlines operating pursuant to Section 1.D. of the Scope Clause in our Basic Agreement. On July 13, 2004, Chautauqua filed an application with the Department of Transportation seeking certification to operate EMB 170 aircraft. I understand that Chautauqua intends to utilize these aircraft on behalf of United Airlines beginning in October 2004.


On behalf of the Allied Pilots Association, I want to clearly and forcefully assert that Chautauqua may not utilize the EMB 170 aircraft and continue to operate as a Commuter Air Carrier under Section 1 of our Agreement. The language of the Scope Clause is unambiguous: to be a “Commuter Air Carrier,” an air carrier must utilize “only (a) aircraft that are certificated in the United States and Europe with a maximum passenger capacity of 50 passenger seats or fewer and (b) aircraft that are not certificated in any country with a maximum gross takeoff weight of more than 64,500 pounds.” If Chautauqua operates the EMB-170, then it is no longer a “Commuter Air Carrier” under Section 1.B.4. and, accordingly, is no longer covered by the Section 1.D. Scope exception for “Commuter Air Carriers.”


I request that American immediately clarify its intent to abide by the Agreement. The parties have agreed that any violation of the APA Scope Clause constitutes irreparable injury to American’s pilots. Together, we must avoid the imminent injury threatened by Chautauqua’s apparent intent to cease operating as a Commuter Air Carrier under our Agreement.


I look forward to receiving your prompt assurances.

Sincerely,

Captain Ralph Hunter
President

cc. Edgar N. James. Esq.
APA Negotiating Committee
APA Scope Committee
APA Board of Directors

Looks like to me, APA probably with a pass given by AMR is jamming it to United in a round about way. What better way to delay "lift" for United then to hide behind the scope issue of APA. They must be laughing in Dallas over United's problems with the EMB170s and CHQ.

Looks like Chautauqua is going to loose this one and United is going to have to decide whether to cancel the contract with CHQ if they can't get up and running. Headquarters in IND must be active tonight.

 

[Dizel8]

Isn't this similar, CHQ and REP, to what Mesa intended to do with Freedumb Air.

I believe that was to circumvent USAir scope?

 

[amcnd]

It's all going to come down to MONEY, how will pay more AA or United?

 

[BoilerUP]

Sofar as I know, AMR's contract is with Chautauqua and not Republic Airways Holdings and Republic Airlines. It seems a blatant violation of APA's scope to put the 170s on CHQ's certificate, and everybody I knew wondered "What the f!uk?" BB and the people on Level 3 & 4 in IND were thinking. However, BB is smart and probably talked with the lawyers and codeshare partners before making the decision to bring the 170s to CHQ initially. I can tell you its been a fookin' nightmare for the training department the last month.

As blatantly obvious as it may be to you and me that CHQ and REP are one and the same (owned by the same holding company with one pilot seniority list), the fact remains they are to be two seperate companies with two seperate operating certificates. I'm no lawyer but I don't know if APA would have any legal grounds to claim CHQ is violating their scope because REP is operating 170s for UAX. Even if they did, AMR probably is just playing the old "grieve it" card and it will all be resolved by the time it comes to settlement. Regardless of what APA or Eagle pilots say, AMR seems to be pleased with the product Chautauqua provides. That being said, will the contract be renewed when it expires? Probably not, to the satisfaction of AE crews and the stress relief of CHQ crews.

This all is more than likely just a means for the end BB sees of Republic becoming an independent carrier 3-8 years down the road, IMO.

Scope is a mouthwash, nothing more.