2500 Free Miles, 25% Off Redemptions, and 15% Off Shopping (Bits ‘n Pieces for January 14, 2014)

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About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Good question re: American’s liability. I’m curious too. (Also not suggesting it should have been discharged.) American’s bankruptcy was a restructuring, not a liquidation, so maybe because there wasn’t a settlement at the time (there wasn’t a defined debt owed) it wasn’t included in the debts to be restructured? Ask @PalmerLaw would know the answer.

  2. There’s no question it was a horrible tragedy, but it seems a bit crazy to me that a judge would rule that American was liable for the attack. It strikes me as a bit of a slap in the face to the crew on the plane, as this is basically saying that a couple of flight attendants and a couple of pilots were responsible for the attack because they weren’t able to overpower five hijackers. Why would they be responsible, and not a lax airport security system that allowed the hijackers into the system in the first place, or an aviation-wide standard of cockpit doors that weren’t adequately reinforced, etc?

  3. IIRC puniTive damages cannot be discharged in bankruptcy. This is a settlement and not a judgment, but there may be ways to craft a settlement to be treated as a non dischargeable punitive award. Others likely know more than I do. Of course, AA could have elected not to treat this liability as one subject todos Harvey the first instance. Only liabilities identified in a petition may be discharged.

  4. Was AA ultimately liable because the airlines pre-TSA were responsible for airport security? Is that the basis?

  5. In 2012 Judge Lane allowed the Cantor Fitzgerald lawsuit to proceed against AA, with damages limited to the amount of AA’s insurance coverage. Injured parties can still pursue insurance companies when a company files BK. Cantor Fitzgerald filed a limited objection to the merger (to be sure it could still proceed with its lawsuit).

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