Judge Won't Recuse Self From Delta Case

The judge overseeing Delta Air Lines Inc.'s bankruptcy case refused Wednesday to remove herself from consideration of Delta's request to impose deep wage cuts on its pilots, rejecting a union lawyer's charges that she made biased comments in past hearings.

Bruce Simon, attorney for the Air Line Pilots Association, said U.S. Bankruptcy Judge Prudence Carter Beatty had made a number of comments in open court that cast doubt on her ability to be impartial. He made a motion that Beatty recuse herself; she denied it.

Simon quoted Beatty as saying in a Sept. 15 hearing that pilots' wages were "hideously high," and that on Nov. 10, a transcript of a hearing showed Beatty said: "Oh, you know what's really weird is why anybody agreed to pay them that much money to begin with. They get paid a lot of money."

The union attorney also accused Beatty of failing to include ALPA lawyers in hearings in which the judge asked about the pilots' duties. Simon claimed such discussions were in violation of federal court rules.

Delta attorney Marshall Huebner called the motion "showmanship," stating that Delta's lawyers had just heard about Simon's motion in open court, and defended Beatty's "sense of humor."

"It is bordering on bad faith when Mr. Simon decides to spring dramatic motions in tremendously important, vital litigation upon their adversaries with zero notice," Huebner said.

Beatty said she did not have a bias against the pilots, and noted that they "were being held up by Delta as the source of all Delta's problems."

She said she asked Delta attorneys about pilots and their duties in order to better understand their position, and that she had assumed ALPA had representatives in the courtroom at the time.

"It may seem to the pilots that I have said some things that I shouldn't have. I'm sure pilots talk amongst themselves in pilot-ese," Beatty said. "I think that I talk in bankrupt-ese, which is perhaps a little different than even legal-ese. I do not believe I have a bias against the pilots."

The two sides were in court for a hearing on Delta's request to void the pilot contract, which would allow it to impose steep wage and benefit cuts on its pilots. The Air Line Pilots Association has threatened to strike if the request is granted.

Faced with rising fuel costs, Delta is seeking to slash $325 million from the collective bargaining agreement with its pilots, saying the money is needed to keep its operations running. ALPA has offered $90.7 million in concessions.

Beatty could decide immediately on the company's request to void the pilot contract, although it's considered likely she will give the sides up to 30 more days to reach an agreement before deciding on her own.

In Atlanta Tuesday, 800 pilots' union members and spouses rallied in support of the union's position, insisting the threat of a strike was not a bluff, although Delta maintains a strike would cripple the company and force a shutdown.

In court papers filed Monday, Delta called a potential strike a "murder-suicide" that would eliminate every job at the company. The airline also argued that, under the Railway Labor Act, a strike would be illegal.

Delta pilots currently earn an average of $169,393 a year, according to a company bankruptcy court filing. The document says the figure is a projection based on year-to-date actual earnings by people employed throughout last year and up to Sept. 16 of this year. It does not include proposed pilot pay rate reductions. Junior pilots make considerably less, while senior pilots in some cases make more. The type of aircraft a pilot flies also is a factor in the pay scale.

If the court approves the cuts, they would be on top of $1 billion in annual concessions the pilots agreed to in a five-year deal reached in 2004. That deal included a 32.5 percent pay cut.

Delta, which filed for Chapter 11 on Sept. 14, has recorded losses of more than $11 billion since January 2001 and over that period has announced it would cut up to 33,000 jobs. Its loss in the third quarter, reported Thursday, was $1.13 billion.


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