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UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK In re AMR CORPORATION, et aL, Debtors. ALLIED PILOTS ASSOCIATION, Plaintiff, V. AMR CORPORATION and AMERICAN AIRLINES, INC., Defendants. Adv. Proc. No. Chapter 11 Case No. 11-15463-SHL (Jointly Administered)

COMPLAINT FOR EXPEDITED DECLARATORY RELIEF

Plaintiff Allied Pilots Association ("APA"), the certified collective bargaining representative of pilots employed by American Airlines, Inc. ("American" or the "Company"), a subsidiary of AMR Corporation ("AMR" or the "Debtor"), brings this Complaint for a declaratory judgment pursuant to 28 U.S.C. 2801. APA seeks a declaration that because the most recent collective hargitining contract between APA and American expired by its terms well betOre the tiling. of this Chapter 11 proceeding I ) there is no comprehensive collective
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APA are obligated, instead, to continue complying with the provisions of the Railway Labor Act, 45 U.S.C. 151-188 ("RLA"). JURISDICTION AND VENUE

This Court has jurisdiction over this action pursuant to 28 U.S.C. 157, 1331, 1334 and 1337, and the district court's Standing Order of Reference re Title 11, because it arises under the RLA, a federal statute affecting interstate commerce, and it arises in and/or is related to the pending Chapter 11 case involving the defendants, In re AMR Corporation, et al., Ch. 11
Case No. 11-15463 (SHL).

2.

Venue in this judicial district is proper pursuant to 28 U.S.C. 1391(b) and (c),

because American does business in this judicial district and is subject to personal jurisdiction in this district. This action is a core proceeding. THE PARTIES 4. Plaintiff APA is an unincorporated association and labor union which has been

certified by the National Mediation Board ("NMB") as the collective bargaining representative of airline pilots employed by defendant American and is therefore a "representative" under the RLA. 45 U.S.C. 151, Sixth. The APA's headquarters are located in Fort Worth, Texas. 5. Worth, Texas.
6. Derendant American k a Delaware corporation and a --onnmon carrier by air
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Defendant AMR is a Delaware corporation with its headquarters located in Fort

enacd in inteNate and tOrcip commerce

!thin ihe meaning or the RIA. 45 U.S,C, 181.

American I icadq u itcr. iC icatLd in Fort VV:)rth,

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7.

Defendants AMR and American are Debtors in the pendin2. Chapter 11

proceeding, In rc .(111s Corporation, et al. , Ch. 11 Case No. 11-15463 (SHL). Plaintiff APA is a party to the Debtors bankruptcy case and has been designated as a member of the Unsecured Creditors Committee in that case.
GENERAL ALLEGATIONS

8.

APA and American concluded their first collective bargaining agreement

("CBA") in 1963. Since that first contract, the parties have negotiated and administered a series of successor CBAs covering terms and conditions of employment for pilots employed at American. The parties' most recent comprehensive CBA (also referred to as the "Agreement" or the "2003-2008 CBA") was a five-year contract beginning May 1, 2003. 9. Section 26-C of the 2003-2008 CBA, the general "duration" clause, defined the

CBA's five-year contract term as effective from May 1, 2003 until May 1, 2008: "This Agreement shall become effective May 1, 2003, except as otherwise dated herein, and shall continue in full force and effect until May 1, 2008." Section 26-C provided that the 2003-2008 CBA would "renew itself without change until each subsequent May 1 thereafter, unless written notice of intended change is served in accordance with Section 6, Title I of the Railway Labor Act, as amended [45 U.S.C. 156], by either party hereto at least sixty (60) days prior to May 1, 2008, or May 1 of any subsequent year." Section 26-D of the 2003-2008 CBA further provided that either party c ould issue such a Section 6 notice and commence the neuutiation process after
\ lav 1. 'Hot): - At WI% lime lllown \ lay 1, 1 006. hut prior to \la\ 1. 1?MtN. with sixty (61) da \ ; prior written notice hv either part \ , the parties \yin commence neuotiations in accordance Section

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10.

American in filet issued a Section 6 notice on July 21, 2006. The Section 6 notice

issued by American forestalled automatic renewal of the terms of the 2003-2008 CBA ii,ovemed by Section 26-C alter the May 1. 2008 expiration date provided in that duration clause. 11. In accordance with Section 6 of the RLA, the parties have entlaued in netzotiations

for a contract to succeed their old 2003-2008 CBA but have not yet reached aueement on a new contract. Pursumit to Section 5, First, of the RLA, 45 U.S.C. 155, First, the NMB has taken jurisdiction of this dispute and has conducted mediation with the parties, a process that continues to date. The NMB has not yet completed its "final required action" under Section 5, First. 12. RLA Section 2, Seventh, prohibits carriers from changing "the rates of pay, rules,

or working conditions of its employees, as a class, as embodied in agreements except in the manner prescribed in such agreements or in section 156 of this title." 45 U.S.C. 152, Seventh. RLA Section 6 provides that "rates of pay, rules, or working conditions shall not be altered" by the carrier until the matter has been "finally acted upon" by the NMB. 45 U.S.C. 156. 13. The "rates of pay, rules, [and] working conditions" of American pilots have not

been altered since the May 1, 2008 contract expiration date. 14. In the event that the parties cannot reach agreement on a new contract through

NMB mediation, the RLA provides at least two additional formal processes for resolving a CBA. The NMB's "final required action" as part of its mediation efforts is to proffer binding arbitration to the parties to resolve their difti.irences. See 45 U.S.C. 155, First, 157-59. Second. it: the ( . 13:\ dispute i ,. not reolved 11% mediation or arbitration. the President or the
!ied State inay create a hoard (die .-Preidcntial Emergency Board") to. among other things.

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"investigate promptly the facts as to the dispute and to make a report thereon to the President" to prevent the interruption of interstate commerce. 45 U.S.C. 160. 15. APA seeks to continue negotiations with American and to conclude a new CBA

under the NMB's auspices. APA is seeking a proffer of binding arbitration from the NMB and will participate in a Presidential Emeruency Board if necessary to reach an aucement. Upon reaching agreement with American, APA would cooperate in presenting the contractual settlement to this Court for approval as prescribed by the bankruptcy code. 16. However, American and/or AMR have threatened to curtail or circumvent the

foregoing statutory processes by using the contract rejection procedure of Section 1113 (c) to implement non-consensual changes in pilots' employment terms and conditions, contrary to the RLA, if APA fails to accept the latest set of demands presented by American on or about February 1, 2012. 17. Section 1113 allows a debtor in possession to "reject a collective bargaining

agreement only in accordance with the provisions of this section," 11 U.S.C. 1113 (a) (emphasis added), and authorizes the Court to "approve an application for rejection of a collective bargaining agreement" only upon finding that certain enumerated criteria have been satisfied. 11 U.S.C. 1113 (c) (emphasis added). 18. 19. The 2003-2008 comprehensive CBA expired on May 1, 2008. The pilots' emploment conditions formerly embodied in those portions of the

20)3-10N (13A that c\pired pur,Liant to Section 26-C 01 - the CBA arc rio( part olany L .ollective
hargtininc . , iigreement or other ,:ontract the) Lailiwit eet,L:d \ thr , ellect bet \ s eell the parties 11.13(e)!Appl this time. Consequentk.

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FIRST CAUSE OF ACTION DECLARATION THAT :AMERICAN MAY NOT USE SECTION 1113(c) TO REJECT OR CHANGE PILOTS' EMPLOYMENT CONDITIONS THAT ARE NOT PART OF AN EXISTING COLLECTIVE BARGAINING AGREEMENT CURRENTLY IN EFFECT BETWEEN THE PARTIES

20.

The APA realle$4es and incorporates by reference the alle2,ations set forth in

Paragraphs 1-19 of this Complaint as if fully restated herein. 21. APA seeks a declaration that: a. there is no comprehensive collective bargaining agreement between the Debtors and the APA that could be "rejected" under 11 U.S.C. 1113(c), and b. 11 U.S.C. 1113(c) does not permit a Debtor to "reject" or change pilots' employment conditions that are not part of a collective bargaining agreement in effect between APA and American at the time of the Section 1113(c) application. 22. The declaration requested by APA would not affect application of Section

1113(c) to any other agreements that may be in effect between the parties at the time of application, including those ageements having a different stated duration and which did not expire on May 1, 2008 pursuant to Section 26-C of the 2003-2008 CBA.
WHEREFORE, Plaintiff prays that this Court: Grant judgment in lavor ofAPA and declare that (I) there is no comprehensive collecti\ e bargaining agreement hci ween the AP. \ and Debtor, that can be mccto. pursuant to

11 U.S.C. 1113(c) and (ii) 11 U.S.C. 11 13(c) does not permit a Debtor to reject - or change

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pilots' employment conditions that are not part of a collective bargaining agreement in effect between APA and American at the time of the Section 1113(c) application. Award the APA the costs it incurs in pursuing this case, including its attorneys' fees; and Award such other relief as the Court deems just and proper.

Respectfully submitted,

Edgar N. James James & Hoffman, P.C. 1130 Connecticut Avenue, NW, Suite 950 Washington, DC 20036 (202) 496-0500

/s/ Joshua R. Taylor Filiberto Agusti Joshua Robert Taylor (admitted pro hac vice STEPTOE & JOHNSON LLP 1330 Connecticut Ave., NW Washington, DC 20036 Tel: 202-429-3000 Facsimile: 202-261-0658 Counsel for Allied Pilots Association.

Dated:

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Certificate

CERTIFICATE OF SERVICE I hereby certify that on this 2Sth day of February 2012, a Complaint was filed with the Clerk et' the Court using the Court's CN1 [CT system and was served 011 the following parties in the manner indicated:

1. Overnight Federal Express: The Chambers of the Honorable Sean H. Lane U.S. BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF NEW YORK One Bowling Green New York, NY 10004 Attorneys for the Statutory Committee of Unsecured Creditors Attn: John Wm. Butler, Jr., Esq. SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 155 North Wacker Drive Chicago, IL 60606 Attorneys for the Debtors Attn: Stephen Karotkin, Esq. WEIL, GOTSHALL & MANGES LLP 767 Fifth Avenue New York, NY 10153 Office of the United States Trustee Attn: Elisabetta G. Gasparin 33 Whitehall Street 21 st Floor New York, NY 10004 The Debtors Attn: Kathryn Koorenny, Esq c/o AMR CORPORATION 4333 Amon Carter Blvd., MD 5675 Fort Worth, TX 76155 Attorneys for the Statutory Committee of Unsecured Creditors Attn: Jay M. Goffman, Esq. SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP Four Times Square New York, NY 10036 Office of the United States Trustee Attn: Brian Masumoto, Esq. 33 Whitehall Street 21 st Floor New York, NY 10004

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Certificate

2. Via First Class Mail to the t011owing AIRCRAFT SERVICE INTERNATIONAL GROUP Attn: General Counsel 201 South Oranc .\ c, Suite 1100.A. Orlando. FL 28()1 IRS CENTRALIZED INSOLVEACY OPERATION P.O. Bo.x 7 346 Philadelphia. PA 19101 AT&T ServiL:es Attn: President Managing Director One AT&T Wav. Rm. 3.A218 Bedminster, NJ 07021 *S.Cl STOMS SLRVICE Attn: Commissioner 1300 PennsyMmia :Avenue. NW Washington, DC 70229

IRS HEADQUARTERS INThRNAL REVENUE SERVICE 15th & Pennsylvania A \ c. NW Washington, DC 20005

IMMIGRATION & NATURALIZATION SERVICE Attn: Acting Assistant Secretary 425 Eye Street, NW, Suite 7100 Washington, DC 20536 Kessler & Collins, P.C. Attn: Anthony J. Barbieri, Esq. 2100 Ross Avenue, Ste. 750 Dallas, TX 75201 Aircraft Service International Group Attn: General Counsel, Legal Department Corporate Headquarters 201 South Orange Ave, Ste 1100A Orlando, FL 32801

DEPARTMENT OF THE TREASURY 1500 Pennsylvania Avenue, NW Washington, DC 20220

Perdue, Brandon, Fielder, Collins & Mott LLP Attn: Harold Lerew, Esq. P.O. Box 8188 Wichita Falls, TX 76307

US Derailment of Homeland Security 245 Murra s Lane SW. #14 Washington. DC 20582-0655 City or F on t w ort h Attn: Christopher B. Mosley. Esq.
.\:;1;1mil Ci1\
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Chatham County Tax Commissioner Attn: Daniel T. Powers P.O. Box 8324 Savannah. GA 31412 Counsel for \lanulacturers & Traders rrust Co DRINKI:R. BIDDLE S... 1.5(mll,l, Street. NAV 1 1 (n1 W,Hhingtkm Dc

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\\ - mrth. I \ -7)] 02 Pamela I. \Valtcr, 14910 Aldine-Westlield Road Houston. TX ;

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Certificate

3. Via Email on the parties listed on the Nlaster Service 1.ist obtained from the Garden City Group's \\ ebsite and attached hereto as Exhibit 1. (Parties on the list without an e-mail \\ere served ia First Class Mail above.

is/ Joshua R. Taylor Joshua R. Taylor (admitted pro hac vice STEPTOE & JOHNSON LLP 1330 Connecticut Avenue, NW Washington, DC 20036 Tel: (202) 429-3000 Fax: (202) 429-3902 JRTaylorgsteptoe.com

Counsel for Allied Pilots Association

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EXHIBIT 1

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In re AMR Corporation, et al.
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Filed 02/28/12 Entered 02/28/12 13:49:35 MASTER SERVICE LIST of ServiceCorporation, 14 of 16 Pg et at. In re AMR
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