Eastern Airlines Sues 2 Unions for $1.5 Billion
In a major escalation of the smoldering warfare between Eastern Airlines and its combative unions, the carrier today filed a $1.5-billion lawsuit against its pilot and machinists unions, accusing labor of trying to destroy the troubled carrier and then buying it “at a bargain basement price.”
The lawsuit filed in U.S. District Court in Miami by Eastern and its parent, Texas Air Corp., accuses the Air Line Pilots Assn. and the International Assn. of Machinists of racketeering, extortion, fraud and defamation.
The suit marks a new salvo in the airline’s rancorous relations with its unions. Since it was bought by Texas Air, management has pressed the machinists to accept deep wage cuts it deems are necessary to return Eastern to profitability.
The suit’s accusations against the unions include charges that they conducted a public “smearing” of the carrier’s reputation, staged illegal work slowdowns and tried to undermine worker loyalty, Eastern said in a press statement.
Suit Labeled ‘Frivolous’
Charles Bryant, president of District 100 of the IAM and a defendant in the lawsuit, characterized the allegations as “frivolous and typical of its (Eastern’s) management style,” a spokeswoman said.
The Eastern-Texas Air complaint alleges the unions are “attempting to obtain ownership and control of Eastern through an extortionate scheme to smear the company’s reputation.”
If the unions fail in their attempt to drive down Eastern’s price, they are willing to ruin the company “to maintain the excessive wages and bring back the high fares prevalent until deregulation changed the industry 10 years ago,” Eastern contended in a news release.
Named in the complaint were ALPA and its Eastern Master Executive Council, the IAM and its District 100, and respective local union leaders, including Bryant and John J. Bavis Jr. of ALPA.
Eastern, whose losses of about $900 million in the past 10 years include a $181.6-million loss last year, was bought by Texas Air in 1986 for $676 million. The Miami-based carrier’s unions tried to halt the sale, making their own offer for Eastern.