United Air Lines, Inc. v. Air Line Pilots Association, International et al

Filing 97

MEMORANDUM Opinion and Order Signed by the Honorable Joan H. Lefkow on 11/17/2008:Mailed notice(mad, )

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION UNITED AIR LINES, INC., Plaintiff, v. AIR LINE PILOTS ASSOCIATION, INTERNATIONAL; STEVEN M. TAMKIN; ROBERT J. DOMALESKI, JR.; XAVIER F. FERNANDEZ; and ANTHONY R. FREEMAN, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

No. 08 CV 4317 Judge Joan H. Lefkow

MEMORANDUM OPINION AND ORDER Plaintiff, United Air Lines, Inc. ("United"), filed a complaint on July 30, 2008 seeking declaratory and injunctive relief under Section 2, First of the Railway Labor Act ("RLA"), 45 U.S.C. § 151 et seq., against the Air Line Pilots Association, International ("ALPA") and four United pilots--Steven M. Tamkin, Robert J. Domaleski, Xavier F. Fernandez, and Anthony R. Freeman1--who are members of an ALPA committee known as the Industrial Relations Committee ("IRC") (collectively, "defendants"). United alleges that ALPA has been engaged for more than a year and a half in a campaign to pressure United to reopen the parties' collective bargaining agreement ("CBA") through unlawful activity. The court's jurisdiction rests on 28 U.S.C. §§ 1331 and 1337.

As addressed in detail below, the evidence is conflicting as to whether Freeman is a member of the IRC and, if so, when he was appointed to that position. Nevertheless, both plaintiff and defendants, at various points in their written submissions, have referred to Freeman as a member of the IRC, and for the sake of simplicity, the court will do so here as well.

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Before the court is United's motion for a preliminary injunction, on which the parties have presented evidence and testimony during an in-court hearing, submitted proposed findings of fact and conclusions of law, and orally presented final arguments to the court. Based on the evidence received, the proposed findings of fact and conclusions of law, and the arguments of the parties, the court enters the following findings of fact and conclusions of law under the provisions of Rule 52(a) of the Federal Rules of Civil Procedure. FINDINGS OF FACT I. Overview of the Present Action United alleges that in December 2006, ALPA launched a public campaign to pressure United to reopen the CBA by encouraging United pilots to engage in various actions intended to increase United's costs and to cause flight delays and cancellations. The elements of this campaign, which United alleges has both intensified and expanded in scope over the past 18 months, include encouraging pilots (a) to "fly the contract," (b) to refuse to voluntary waive provisions of the contract even if they are designated as waivable, (c) to refuse voluntary flight assignments known as "junior/senior manning," (d) to increase fuel consumption, (e) to refuse to operate aircraft with deferrable maintenance items, and (f) to take excessive time in pre-flight cockpit checks. Most recently, United alleges that in July 2008, ALPA and the four individual defendants coordinated a "sick-out" among United's junior pilots that, combined with ALPA's campaign against the acceptance of voluntary flight assignments, caused several hundred flight cancellations, affecting over 30,000 United customers. Additionally, on August 1, 2008, shortly after being served in this action, ALPA, pursuant to negotiations with United, agreed to publish to the United pilots whom it represents

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certain statements indicating that pilots should not engage in activities, such as calling in sick when they are not ill, that may disrupt operations and emphasizing that ALPA does not condone such conduct. That agreement has been described by the parties as the "Standstill Agreement." Pursuant to the Standstill Agreement, ALPA also published a negotiated statement on junior/senior manning to United's junior pilots, though it did not do so until August 13, 2008. In response to United's motion, defendants argue that (a) United's disputes with ALPA regarding junior/senior manning and waiver of contract provisions are minor disputes that fall outside the court's jurisdiction; (b) United's claim challenging ALPA's conduct and communications regarding junior/senior manning and contract waivers is barred by the applicable six-month statute of limitations; (c) United has established only that there was an elevation in sick leave usage that was expected by the company as a result of its announcements of fleet reductions and resulting furloughs, not that there was an organized sick-out; (d) ALPA's statements to pilots in August 2008--indicating that they should not engage in activities that may disrupt operations and emphasizing that ALPA does not condone such conduct--obviate the need for a preliminary injunction; and (e) United has not satisfied the requirements of the NorrisLaGuardia Act ("NLGA"), 29 U.S.C. §§ 101­115, for an injunction in this labor dispute. II. The Parties United, headquartered in Chicago, is the second largest airline in the United States, with both domestic and international operations. United is a carrier subject to the RLA. On an average day, United operates more than 1,500 flights and carries more than 200,000 customers. United presently employs approximately 55,000 employees, of whom about 6,500 are pilots.

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ALPA is the certified collective bargaining representative for pilots employed by United. Under ALPA's constitution and bylaws, ALPA's United Master Executive Council ("the MEC" or "UAL MEC") has authority and responsibility for representing United pilots. The MEC is comprised of the top three officers of each of the Local Executive Councils ("LECs"), which are local ALPA units that represent United pilots at a particular pilot domicile. The MEC Chairman, who is the highest-ranking ALPA officer at United, is elected every two years by the MEC. In 2007, Mark Bathurst was the MEC Chairman. In October 2007, the MEC elected Stephen Wallach as Chairman. Wallach officially took office on January 1, 2008 but began performing certain functions of the Chairman immediately following his election. One of the MEC's principal communication vehicles for its membership is a website on which the MEC posts a newsletter called the "MEC Update" two or three times a week, correspondence and video presentations from the MEC Chairman, MEC statements and committee reports, and video presentations from other MEC entities. The MEC also emails these communications to those United pilots--approximately 90% of members--who have provided ALPA with their email addresses. Most of the MEC communications received in evidence during the preliminary injunction hearing were posted on the ALPA web site. In addition, ALPA uses a variety of communications systems that are limited to ALPA members. One of these systems is a password-protected website known as the UAL MEC Forum, in which ALPA members may post statements to other United pilots. The UAL MEC Forum is divided into a series of topic-oriented sites and has been described as a place where "pilots can go and B.S. with each other." Wallach Dep. 41:22­23. Other communications systems limited to ALPA members include telephone trees and text messaging systems that the

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MEC and its committees use to send time-sensitive information to United pilots, as well as a "Pilot to Pilot Committee" which sets up information tables in pilot domiciles at which volunteers can privately communicate information from ALPA to United pilots. The IRC consists of three to four members (sometimes referred to as officers)2 and includes a chairman. The IRC Chairman, who is appointed by the MEC Chairman, appoints the other members of the IRC. The IRC also maintains a network of more than a dozen local coordinators (sometimes referred to as local members or lower-level members),3 who carry out the IRC's directions at each pilot domicile. See, e.g., Tamkin Dep. 59:22­61:17. The MEC Chairman directs the operations of the IRC through the IRC Chairman, who transmits the instructions to the other members. The IRC members pass these instructions to the IRC's local coordinators who, in turn, pass those instructions to pilots through a network of ALPA allies whose number the current IRC chairman estimated at several hundred. Tamkin Dep. 76:23­77:7. The IRC also functions as an intelligence-gathering operation, using the same reporting structure in reverse. According to the UAL-MEC Policy Manual, one of the central responsibilities of the IRC is the "formulation and implementation of labor actions." Pl.'s Ex. 24, at 2; accord Domaleski Dep. 50:20­51:8. The IRC operates secretly, communicates only in person or by telephone, and does not commit anything to writing, eschewing both email and text messaging, all for the acknowledged purpose of avoiding a "written trail" of its communications, which generally

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See, e.g., Domaleski Dep. 37:6­41:2. See, e.g., Freeman Dep. 23:5­24:8. 5

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concern "labor strategies and negotiation-type strategies." See, e.g., Domaleski Dep. 59:21­60:19. Defendant Tamkin is the Chairman of the IRC, a position he has held since approximately April 2007. He was hired by United in 1985 and currently serves as a Captain on the A320 aircraft. Tamkin served as an IRC local coordinator from 1987 to 1993 and as an IRC member from 1993 to 2001. Tamkin testified in his deposition that "it was implicit" when he was appointed Chairman of the IRC that ALPA wanted to take a more "aggressive" or "progressive" stance in labor relations with United.4 Tamkin Dep. 18:24­19:12. Tamkin describes himself as having a "close personal affiliation" with MEC Chairman Wallach and testified that he provided Wallach with "frequent and continuous" oral status reports on the IRC's actions. Tamkin Dep. 83:14­24. Defendant Domaleski is the Vice-Chairman of the IRC. He was hired by United in 1985 and is currently a Captain on the B-777 aircraft. Domaleski served as an IRC local coordinator in 2000. Defendant Fernandez is Secretary of the IRC. He was hired by United in 1995 and is currently a Captain on the B-737 aircraft. Defendant Freeman, currently a First Officer on the A320 aircraft, was hired in March 2000, furloughed in January 2003, and recalled to active service in August 2006. Freeman was one of 2,172 United pilots--a group that refers to itself as "the 2172"--who were furloughed following September 11, 2001. In December 2007, Freeman created a website, ual2172.com, to

Tamkin initially used the term "aggressive" but later asserted that the word he meant to use was "progressive." Tamkin Dep. 19:6­20:2. 6

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facilitate communications to the 2172 and protect their mutual interests as the most junior pilots at United. There is no evidence that Freeman received assistance from ALPA in creating or maintaining the website. The website is password-protected, and access is allowed only to pilots who were furloughed after September 11 and are personally approved by either Freeman or one of the two other website administrators. The three administrators also communicate directly, through mass e-mails, with pilots who participate in the website. Freeman testified that the ual2172.com accounts of pilots who signed up with United e-mail accounts "have been deleted," Freeman Dep. 62:2­9, presumably in order to prevent United management from monitoring emails from the website. In early June 2008, Freeman and the other two administrators also established a phone tree system, which would not leave a paper trail. In emails and messages posted on ual2172.com, Freeman warned participants that the website was not completely secure and that only the phone tree system should be used if the content of a communication was something that "just [was]n't meant for paper or electronic communication." Pl.'s Ex. 179. The deposition testimony of the four individual defendants is conflicting as to the dates of their respective appointments and, more significantly, whether Freeman is, or ever was, a member of the IRC.5 All four agreed that Tamkin was Chairman of the IRC, Domaleski was Vice-Chairman, and Fernandez was Secretary. Tamkin testified that he was appointed in April 2007 by then-MEC Chairman Bathurst and that he appointed Domaleski, Fernandez, and Freeman in April 2007. Tamkin Dep. 12:20­25, 17:16­18:8. Domaleski, however, testified that he, Tamkin, and Fernandez were appointed to the IRC around November 2007 to support

The four individual defendants testified only at their depositions prior to the preliminary injunction hearing; none of the four was called to testify at the hearing. 7

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newly-elected MEC Chairman Wallach, and that Freeman was not a member.6 Domaleski Dep. 37:6­41:2, 57:16­58:19. Fernandez testified that he, Tamkin, and Domaleski were appointed in May 2007, but he agreed with Domaleski that Freeman was not a member of the IRC. Fernandez Dep. 16:20­24, 18:3­10. Freeman himself testified that he was a member of the IRC, appointed in approximately June 2007 and that the only other members were Tamkin, Domaleski, and Fernandez. Freeman Dep. 23:5­24:22. In their most recent written submission, presumably authored by their mutual counsel, defendants assert that Freeman is a member of the IRC but do not specify when he was appointed to that position. Defs.' Proposed Findings of Fact ¶ 160. These discrepancies are material and cast doubt on the candor of the deposition testimony of the IRC members, particularly with regard to a meeting among the four pilots on June 11, 2008 and their role in the July sick-out, both of which are addressed in detail below. If Freeman was not a member of the IRC, it would have been difficult for defendants to provide an innocent explanation as to why he met with the IRC members on June 11, 2008. Similarly, the date of their appointments to the IRC bears on the issue of whether the IRC, which had been "disbanded" at the end of 2000, Domaleski Dep. 79:24­81:11, was reactivated during formerMEC Chairman Bathurst's tenure or after Wallach was elected MEC Chairman. The inconsistencies as to those dates could thus reflect an effort by IRC Chairman Tamkin and MEC

Specifically, Domaleski testified that Freeman was merely an IRC local coordinator, but not an upper-level "member" or "officer" of the IRC. Domaleski Dep. 37:6­41:2. Indeed, Domaleski indicated that he first met Freeman at a meeting in Los Angeles on June 11, 2008, at which time he "very curious about" why Freeman was there because "it was just Steve [Tamkin], X[avier Fernandez], and myself [that] were members of IRC, so it was very unusual for [Freeman] to be there." Domaleski Dep. 40:21­41:2. 8

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Chairman Wallach, whom Tamkin describes as a close friend, to place responsibility for reactivating the IRC on Wallach's predecessor, Bathurst, rather than on Wallach. In its reply memorandum filed on August 22, 2008, well in advance of the evidentiary hearing, United argued at some length that these discrepancies cast serious doubt on the individual defendants' credibility and asserted that the defendants' "characterization of [their] actions in their Opposition Memorandum is utterly incredible." Pl.'s Reply (Dkt. No. 57), at 10­15. The four IRC members were on the witness list filed by defendants prior to the evidentiary hearing and were present in court throughout the hearing, yet were not called as witnesses to rebut United's interpretation of the evidence. Under these circumstances, the failure of defendants to call any of the IRC members or otherwise explain the discrepancies in the defendants' testimony casts even further doubt on ALPA's position that Freeman was a member of the IRC. Indeed, the preponderance of the evidence is that he was not a member at the time of the June 2008 meeting and that those who attended were less than candid about what occurred at that meeting. III. History and Background of the Current Labor Dispute Both sides presented evidence regarding the history and background of labor relations between United and ALPA, including a pilots' strike at United in 1985, and a slowdown by United pilots during contract negotiations in the summer of 2000. In May 1985, a highly contentious strike by United pilots occurred. During the strike, which lasted about a month, United hired permanent replacements for the striking pilots. Approximately 600 to 700 pilots either crossed the picket line or were hired by United and went

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to work during the strike.7 The parties negotiated a "Back-to-Work Agreement" when the strike ended. That agreement provided that United would continue to employ the pilots who were hired during the strike and that there would be no retaliation by United against the striking pilots or by ALPA against the pilots who worked during the strike. Although the parties offered some testimony regarding the background of the 1985 strike and the numerous legal disputes arising out of it, the court need not rely on such testimony here, because the background of the strike is set forth at length in Air Line Pilots Assoc. Int'l v. United Air Lines, Inc., 614 F. Supp. 1020 (N.D. Ill. 1985) (modified, 616 F. Supp. 849 (N.D. Ill. 1985)), aff'd in part and rev'd in part, 802 F.2d 886 (7th Cir. 1986); Air Line Pilots Assoc., Int'l v. United Air Lines, Inc., 802 F.2d 886 (7th Cir. 1986), cert. denied, 480 U.S. 946 (1987); and Rakestraw v. United Air Lines, Inc., 765 F. Supp. 474 (N.D. Ill. 1991), aff'd in part and rev'd in part, 981 F.2d 1524 (7th Cir. 1992). Despite the no-retaliation provisions of the Back-to-Work Agreement, pilots who worked during the strike were subjected to a pattern of ostracism and harassment by the striking pilots for many years following the strike. The ostracism included striking pilots' refusal to engage in conversation or shake hands with non-striking pilots, outcomes that were likely exacerbated, if not facilitated, by ALPA's issuance to striking pilots of a special ALPA pin known as the "battle star," which made it possible to identify non-striking pilots. Evid. Hearing Tr. 216:24­217:15. Other forms of harassment included clicking a toy clicker whenever a non-striking pilot entered a work area; theft and damage of flight bags and other personal belongings; pouring liquids,

United had anticipated that it would utilize approximately 570 new-hire pilots whom the airline had trained before the strike. 10

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urinating, or defecating into the flight bags of non-striking pilots; sending magazine subscriptions or other unsolicited materials to the homes of non-striking pilots; harassing phone calls and mail; and personal confrontations with non-striking pilots. According to Paul Vanderheiden, United's former Managing Director of Labor Strategy, the harassment had such a debilitating effect on the non-striking pilots that many ultimately resigned their employment. The continued ostracism and harassment of non-striking pilots in the two decades following the 1985 strike created a widely-held perception among United pilots that any pilot who did not follow the majority, or ALPA, party line would be subject to similar conduct.8 United presented at the hearing evidence that similar types of harassment have been directed at pilots who failed to follow ALPA's directives to "fly the contract" during both a pilot slowdown in 2000 and the current campaign to reopen the CBA (both of which are discussed further below). Examples of more recent harassment include the posting on bulletin boards of pilots' names, personal information, and printouts showing that they had accepted voluntary overtime assignments (often referred to as "junior/senior manning"); harassing notes left in pilots' mailboxes; magazine subscriptions or other unsolicited materials sent to pilots' homes; and harassing phone calls. In 1999, United and ALPA entered into negotiations for a new collective bargaining agreement to replace the then-operative agreement, which became amendable9 in April 2000.

Defendants failed to produce evidence to rebut the testimony regarding pilot perceptions of the harassment they faced if they did not follow ALPA's directives. An "amendable date" is a term of art under Section 6 of the RLA, 45 U.S.C. § 156, which effectively dictates the duration of an agreement by providing a period of time during which neither party can unilaterally compel negotiations to modify the agreement. See Equal (continued...) 11
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With respect to those negotiations, United agreed, in a contract dated November, 20, 1998, that it would seek to negotiate a "seamless" agreement, meaning that the new agreement would take effect upon the amendable date of the then-existing agreement. When a new agreement was not achieved by April 2000, ALPA used the IRC to help implement a slowdown campaign by passing messages to pilots instructing them to refuse voluntary overtime flying and decline contract waivers. For example, defendant Domaleski testified that as an IRC local coordinator in the summer of 2000, he "[c]ommunicat[ed] a message to pilots that they didn't have to pick up overtime flying" and also told them to "fly according to the FARs [Federal Aviation Regulations], the flight operations manual, and the contract." Domaleski Dep. 55:12­17. Other evidence that ALPA implemented a slowdown campaign during the summer of 2000 includes (a) statistical evidence showing dramatic increases in flight delays and cancellations attributable to pilot actions (such as refusals to depart with minor equipment problems or delays in completing pre-flight checklists), beginning in April 2000 and decreasing abruptly after the parties reached agreement; (b) publications by ALPA during 2000 that openly encouraged members to "fly the contract" and engage in other actions designed to put pressure on United to agree to ALPA's demands; and (c) the testimony of ALPA's principal witness, MEC Coordinator and Senior Legal Counsel Robert Nichols, who implicitly admitted that United pilots had engaged in a slowdown during the summer of 2000.10

(...continued) Employment Opportunity Comm'n v. United Air Lines, Inc., 755 F.2d 94, 99 (7th Cir. 1985) ("[T]he service of the [Section 6] notice is the mode of amendment, implying that what is not sought to be changed continues in effect.").
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Although Nichols asserted that factors that affected delays that summer included (continued...) 12

United has presented evidence that the summer 2000 slowdown was in many respects substantially the same as what has occurred in ALPA's current campaign to reopen the CBA. These include delays in completing pre-flight checklists, refusal to depart with minor equipment problems, refusal to waive contractual rest and duty requirements, and refusal to accept junior/senior manning assignments. Statements that appeared in ALPA publications in 2000 encouraging pilots to engage in a slowdown that summer are markedly similar to statements appearing in ALPA's publications over the last 18 months. For example, ALPA publications during both time periods included communications instructing pilots to "fly the contract" and "honor the contract." Compare, e.g., Pl.'s Exs. 16­17 and Evid. Hearing Tr. 225:23­227:4, 228:9­15 with, e.g., Pl.'s Ex. 25. Similarly, communications during both periods discouraged pilots from waiving sections of the contract and discouraged the acceptance of junior/senior manning assignments. Some of the ALPA publications in 2000 expressly encouraged ALPA members to confront pilots who were not following ALPA's directives to refuse contract waivers or voluntary flight assignments. For example, a 2000 publication from one of the LECs stated, For a year now [we] have asked [you] to . . . honor your contract, write up broken airplanes and have them fixed, and not cut deals with the crew desk or others to the detriment of our pilot group. We encouraged you not to defer your vacation. . . . If your peers are dogging it, bring it to their attention. Many pilots continue to believe their

(...continued) weather issues in the Midwest and air traffic controller issues, he also testified that what took place during the summer of 2000 was due, in part, to United's "failure to live up to their commitment to . . . achieve a seamless agreement" and suggested that "the company is the party that took the hay out of the . . . loft, spread it all around the outside of the barn, dumped gasoline all over it, and then gave the match to the pilots." Evid. Hearing Tr. 637:9­23. 13

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little secret will either not be found out or doesn't really matter to the rest of the pilots. All it takes is for another pilot to get screwed by a slimy do-gooder and it matters greatly. Pl.'s Ex. 16, at 4 (emphasis added); accord Evid. Hearing Tr. 227:10­228:1. Pilots who accepted junior/senior manning or other voluntary flying assignments during the summer of 2000 were subject to harassment that was similar in many respects to the harassment of non-striking pilots following the 1985 strike, including posting their names on bulletin boards, often with derogatory comments written about them, receiving notes in their company mail files, and receiving phone calls at their homes warning them not to accept these assignments. The acceptance of junior/senior manning assignments decreased dramatically during the summer of 2000. The delays and cancellations caused by ALPA's campaign damaged United operations and reputation. In the face of this, United agreed to a tentative agreement on a new collective bargaining agreement in late August 2000 that provided wage increases in the range of 30 to 40 percent. The day after that agreement was reached, delays and cancellations declined to "near normal" levels. Evid. Hearing Tr. 85:21­86:2. Approximately 90 percent of United's current pilot workforce was employed by United during the summer of 2000. Accordingly, the court can infer that in 2007 and 2008, United pilots (a) understood how the elements of a slowdown campaign could be implemented; (b) understood what ALPA intended when it used terms such as "fly the contract"; (c) understood that failure to comply with ALPA's directives could result in harassment by other pilots; and (d) believed that a slowdown campaign could create "leverage" in negotiations with United that would likely create a favorable contract settlement.

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The evidence regarding the 2000 negotiations also provides context for some of the communications by ALPA and its members in connection with the current dispute. For example, in an April 20, 2007 video message to United pilots, Jim Anderson, the current Chairman of ALPA's Strike Preparedness Committee ("SPC") said, "If you have any doubt about what leverage is and what it can accomplish, please talk to some pilots who remember previous negotiations." Pl.'s Ex. 1B, at 6. On a similar note, during a debate in September 2007 among candidates for chairmanship of the MEC, soon-to-be-elected MEC Chairman Wallach stated, "Contract 2000 was obtained due to line pilots forcing the company to negotiate. Our strength[] is with the line pilot. Unless you guys take control of your destiny, it ain't gonna happen." Evid. Hearing Tr. 928:19­24; accord Pl.'s Ex. 227, at 4. Wallach also expressed the opinion that "[w]e have to make it more expensive for [United] not to negotiate than to negotiate." Pl.'s Ex. 227, at 11; Hearing Tr. 929:22­930:5. Even more recently, in June 2008, MEC member Carlos Rodriguez sent an email to other members of the MEC, including MEC Chairman Wallach, referencing the summer of 2000. Rodriguez wrote, "In 2000 we brought our CEO to his knees over a delay in our agreed upon `seamless contract,'" and "I am prepared to increase my level of risk." Pl.'s Ex. 223. IV. United's Bankruptcy and the Current CBA In December 2002, as a result of reduced demand for air travel following the terrorist attacks of September 11, 2001, and high operating costs, United filed a petition under Chapter 11 of the Bankruptcy Code. While in bankruptcy, United negotiated with each of its unions, including ALPA, new labor agreements that reduced its labor costs substantially. In 2003, United and ALPA reached agreement on a package of wage, benefit, and work rule

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modifications that included a 40% wage reduction for United pilots. In late 2004 and early 2005, as the result of further deterioration in United's financial condition, the parties negotiated further modifications, including additional wage reductions and termination of the pilot defined benefit pension plan. The resulting collective bargaining agreement (titled as the "2003 Agreement" even though it includes modifications negotiated as late as 2005) contains an amendable date of December 31, 2009. Defs.' Ex. 62, at 281. The 2003 Agreement further provides that it shall renew itself each year on January 1 unless proper written notice of an intended change is served by either party on the other. Defs.' Ex. 62, at 281. Such notice, however, cannot be served more than 270 days prior to the amendable date. Id. at 281­82. Thus, neither party may unilaterally initiate negotiations to modify the current CBA until April 2009. The parties agree, however, that this provision would not prohibit the parties from agreeing to modify the contract prior to that date. V. United's Financial Condition Since the Bankruptcy United exited bankruptcy in February 2006 and became profitable. United earned an operating profit of approximately $25 million in 2006 and about $1 billion in 2007. In 2008, however, United's financial results deteriorated significantly as a result of substantial increases in the price of jet fuel. The effect of fuel price increases is illustrated by the fact that during 2002, the year that United entered bankruptcy, it paid about $2 billion for fuel; in 2007, by contrast, United paid roughly $5.5 billion for fuel, and in 2008, United anticipates paying approximately $9 billion for fuel. Largely as a result of these increased fuel costs, United suffered a $680 million operating loss, as well as a $2.7 billion net loss, in the first six months of 2008.

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On June 4, 2008, United announced plans to retire 94 B-737 aircraft and six B-747 aircraft. The planned fleet reduction will result in furlough notices to 1450 United pilots, including 950 active pilots and 500 pilots on leaves of absence. According to United, the "vast majority" of pilots to be furloughed "would have been individuals who had been furloughed and recalled in the post 9/11 environment." Evid. Hearing Tr. 429:16­430:12. VI. ALPA's Recent Efforts to Reopen the CBA Seeing that United was profitable again, less than a year after United exited bankruptcy, ALPA initiated efforts to renegotiate the 2003 Agreement, though that agreement has an amendable date of December 31, 2009. Beginning in December 2006, then-MEC Chairman Bathurst announced a campaign called "Fix It Now," and such efforts became more aggressive under current Chairman Wallach. Both Bathurst and Wallach have expressly tied the success of ALPA's efforts to reopen the agreement to actions by United pilots to create "leverage" by "flying the contract," refusing to waive anything in the contract, and similar directives denoting a "work-to-rule" or slowdown campaign. See, e.g., Pl.'s Ex. 68; accord Pl.'s Exs. 1B, 53; Evid. Hearing Tr. 275:1­276:3, 298:2­300:12. United asserts that its position throughout this period was that it was willing to address specific concerns of United pilots, particularly if those concerns could be addressed without increasing United's costs, but it would not agree to a wholesale reopening of the existing CBA. United recognized that ALPA was employing slowdown tactics, and United's senior management addressed that concern directly with both Bathurst (in May 2007) and Wallach (in January 2008). Both Bathurst and Wallach denied ALPA's involvement in any unlawful behavior, and ALPA took no apparent action in response to United's requests. United thus

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sought to manage the situation by negotiating agreements with ALPA to address the specific concerns of United pilots regarding the existing agreement, as well as by increasing its reserve staffing in an effort to ensure that ALPA's tactics did not disrupt United's operations. From late 2006 to the present, United increased the reserve component (for all reasons other than illness) in its manpower planning model by approximately 30 percent. The annual cost to United of this increase is approximately $15 million. On July 14, 2008, at the direction of MEC Chairman Wallach, ALPA terminated all negotiations with United. Shortly thereafter, United pilots began a sick-out that resulted in several hundred flight cancellations. A. The "Fix It Now" Campaign Under Former MEC Chairman Bathurst The "Fix It Now" campaign, launched by Bathurst in December 2006, was focused initially on modifying certain work rules negotiated during bankruptcy that ALPA believed were unreasonably onerous. In connection with the campaign, Bathurst reactivated the MEC's Strike Preparedness Committee ("SPC"), which had been inactive for nearly five years. At that time, ALPA could not lawfully strike for at least three more years. In announcing the campaign, ALPA told United pilots that "[t]he `Fix It Now' theme is the SPC's message to you that you need to join us in ensuring we all fly the present contract and not waive any section of it." Pl.'s Ex. 25, at 1 (emphasis in original). United's witnesses testified, without rebuttal, that the phrase "fly the contract" was widely recognized as a synonym for a "work-to-rule" campaign designed to slow down the airline's operations in order to put financial pressure on the company as a means of obtaining additional leverage in collective bargaining negotiations.

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In January 2007, United agreed to discuss with ALPA the potential modification of some of the existing work rules if this could be done on a "cost-neutral" basis. Evid. Hearing Tr. 280:11­282:2. The parties convened their respective negotiating committees, and on or about March 16, 2007, the committees reached a tentative agreement, titled "Line Guarantee and LCO Pay Rig Letter of Agreement." Pl.'s Ex. 28, at 1. The tentative agreement was ratified by the MEC, but in April 2007, ALPA's membership refused to ratify it. On April 20, 2007, then-MEC Chairman Bathurst recorded a video message in which he informed United pilots that the "Fix It Now" campaign would continue despite rejection of the tentative agreement and that ALPA would pursue a more aggressive posture in seeking to modify the existing labor agreement. In this message, Bathurst reiterated that the success of ALPA's efforts depended on actions by United pilots to create bargaining leverage: I cannot over emphasize the importance to all of us, however, that we embrace a new attitude about our contractual obligations. It is in no one's interest to waive anything in our contract. It is not in our collective interest to seize opportunities for personal gain at the expense of delaying collective contractual gains. If the contract does not say that a waiver requires pilot concurrence, the provision is not waivable and the company has no business asking that you do so. Even where the contract says that a provision may be waived with your concurrence, there may be adverse collective consequences to consider. For example, I have spoken to you previously about . . . the widespread use of junior-senior manning, which was originally designed as a tool for irregular operations[,] and how it slows down recalls and promotions. This is only one example. Until our work rules and compensation are restored, these issues should be carefully considered before waiving any part of our contract. Pl.'s Ex. 1B, at 1­2 (emphasis added). Following the Bathurst video, United began to see a substantial drop in the number of pilots willing to accept junior/senior manning assignments and an increase in so-called "rat lists" directed at pilots who accepted such assignments. United asked to meet with ALPA about the issue, and on May 30, 2007, four United officials--Chief Operating Officer Peter McDonald, 19

Senior Vice President of Flight Operations Sean Donohue, Vice President of Labor Relations Peter Kain, and Managing Director of Labor Strategy-Flight Jay Milone--met with MEC Chairman Bathurst and MEC Senior Legal Counsel Robert Nichols. At the meeting, McDonald expressed concern regarding the decline in acceptance of junior/senior manning assignments following the April video, and the posting of rat lists directed at pilots who accepted such assignments. In response, Bathurst told United that ALPA had no involvement in the rat lists, which he blamed on a rival group seeking to organize United pilots, and that United should deal with harassment issues itself through the disciplinary process. ALPA took no apparent action in response to United's concerns. Rather, the acceptance of junior/senior manning requests continued to decline, and there was no apparent reduction in the level of harassing activities. Although the parties did not revisit during Bathurst's tenure the issues covered by the March 2007 tentative agreement, United continued to negotiate with ALPA on other issues of concern to the pilots. On September 21, 2007, United and ALPA reached agreement on implementation of a web-based trip trading program, and on October 1, 2007, the parties reached agreement on providing a guaranteed minimum number of flying hours under the ALPA contract. B. The "Unity" Campaign Under MEC Chairman Wallach The MEC elected Wallach as MEC Chairman in October 2007, and he officially assumed office on January 1, 2008. Like Bathurst, Wallach has vocally sought to reopen negotiations to improve the existing CBA and has tied the success of ALPA's efforts to actions by United pilots

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to create leverage.11 Wallach, however, pursued ALPA's goals more aggressively than his predecessor and sought to reopen the entire agreement. In campaigning for the MEC chairmanship election, for example, Wallach indicated that he opposed "cost neutral" concessions, such as those offered in the March 2007 tentative agreement with United, and pledged that he would take a more aggressive approach toward United than his predecessor. Evid. Hearing Tr. 928:8­931:14. In a September 30, 2007 e-mail to MEC members, one of his supporters, IRC member Fernandez, touted the new, more aggressive approach that Wallach promised to bring to the MEC, writing, "Since I can almost hear the grenades clinking in his pocket, you can pretty well guess that he is the kind of guy I like." Fernandez Dep., Ex. 5, at 1. In September 2007, Wallach outlined his plans in a debate among MEC chairmanship candidates before the San Francisco LEC. In that debate, Wallach said that "Contract 2000 was obtained due to line pilots forcing the company to negotiate" and that "[w]e have to make it more expensive for [United] not to negotiate than to negotiate." Pl.'s Ex. 227, at 4, 11; Evid. Hearing Tr. 928:12­930:5. Wallach further asserted that he would [t]ell [United CEO Glenn] Tilton up front about [ALPA's] intent to work against [United]. Example: The SPC picketed Abbott Labs . . . go outside the traditional . . . go on the offensive. We could attack the RLA in Congress. Attack, attack, attack! Pl.'s Ex. 227, at 12 (emphasis added); accord Evid. Hearing Tr. 931:7­14. Wallach also explained that although ALPA could not tell pilots specifically what action to undertake in support of a slowdown campaign, the MEC could tell pilots, "[H]ere is your flight manual, FOM

As one "Unity" handout emphasized, "Leverage does not just show up unannounced on one's doorstep. Unified pilots create leverage." Pl.'s Ex. 53, at 1. 21

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[flight operations manual], pilot agreement. Abide by it." Evid. Hearing Tr. 929:6­12 (emphasis added); accord Pl.'s Ex. 227, at 5. Finally, Wallach suggested that he did not view the illegality of slowdowns under the RLA as a serious impediment, telling the audience, "You should use lawyers to get you out of jail when you do what you need to do. A lot more could be done. A good offense is a strong defense." Evid. Hearing Tr. 930:16­931:6; accord Pl.'s Ex. 227, at 12. Wallach made clear that his primary goal as MEC Chairman was to force United to renegotiate the entire CBA and to restore the terms that were in effect before United's bankruptcy. On January 1, 2008, his first day in office as MEC Chairman, Wallach issued a video message to United pilots, declaring, Today, our fight to take back our airline and reclaim what was stolen from us begins. . . . This fight isn't about me, this fight isn't about you, it's about us[--]to win back what was stolen from us during United['s] bankruptcy[] will take determination, resolve, and most importantly[,] solidarity." Pl.'s Ex. 68, at 2; Evid. Hearing Tr. 299:14­300:12. Wallach emphasized that his newlyacquired position "carries with it a clear mandate, to lead the pilots of United Airlines to reclaim what was pilfered from our family's pockets during the bankruptcy and to achieve" a new collective bargaining agreement. Pl.'s Ex. 68, at 1. Since Wallach took office, virtually every MEC Update has begun with some version of the following text: Today was the 197th day that the Company could have sat down with its pilots to discuss a complete fair and equitable contract. They chose not to. That makes 1,896 days (5 years, 2 months, 14 days) of living under the current draconian contract and work rules negotiated under duress of bankruptcy. Pl.'s Ex. 69, at 1 (emphasis in original); accord Evid. Hearing Tr. 300:13­301:10.

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On December 13, 2007, a few weeks before formally assuming office, Wallach sent a letter to United's CEO proposing that the parties "commence early negotiations on a new collective bargaining agreement" and warning that the negotiation process "otherwise cannot reasonably be expected to conclude with an agreement by the amendable date" at the end of 2009. Pl.'s Ex. 67. In response to this letter, members of United management asked to meet with Wallach and ALPA's corporate governance attorneys in early January 2008. In that meeting, United's representatives informed Wallach that United was actively considering potential consolidation with another airline and asked for ALPA's support in that effort. As a result of these talks, the parties agreed to defer discussion of Wallach's request to reopen the CBA until after the consolidation issues were resolved. In response to United's request for ALPA's support in possible merger discussions, Wallach told United in January 2008 that ALPA would support United's position if the company would agree, as a "goodwill gesture," to implement the portions of the failed tentative agreement of March 2007 that ALPA viewed as favorable to the pilots. Evid. Hearing Tr. 875:8­16. United, in turn, said it would agree to do so if ALPA would agree to "take the customer out of [it]," an agreement that United believed would result in an end to the slowdown campaign. Evid. Hearing Tr. 83:2­10, 875:25­876:10. At the evidentiary hearing, Wallach admitted that he agreed to United's request but testified that he was told by United that this condition applied only to "an informational picketing campaign of some local corporate clients and institutional clients," not to any other elements of ALPA's campaign to reopen the CBA. Evid. Hearing Tr. 875:8­876:23. ALPA did, in fact, stop certain customer picketing that it had been conducting for a period of time, though it resumed that picketing after United ended its consolidation

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discussions in April 2008. Wallach testified that ALPA resumed the picketing because he believed the promise to "take the customer out of it" was limited to the period of time that United was actually pursuing merger discussions. Evid. Hearing Tr. 933:16­934:20. On January 25, 2008, as the "goodwill gesture" that Wallach had sought, United and ALPA executed a letter of agreement that modified two work rules that had been at issue in the failed tentative agreement of March 2007, regarding "line guarantees" and "LCO pay rigs." Pl.'s Ex. 79; Evid. Hearing Tr. 304:12­305:22. In February 2008, United's Pete McDonald presented Wallach with charts and data regarding operational issues, such as increases in cockpit check delays, and asked for Wallach's help in eliminating the disruptions. Following that meeting, the operational issues did not improve. In April 2008, ALPA concluded that United had abandoned its consolidation efforts. Accordingly, Wallach sent United a letter in which he renewed his request from December 2007 to reopen negotiations on the CBA. In response to Wallach's request, United reiterated its position that it would not agree to reopen the entire contract but was willing to address specific issues where the company believed that modifications were appropriate. On April 16, 2008, United and ALPA reached an agreement to set up a joint process to address fatigue issues. After executing this agreement, United agreed to discuss what ALPA termed "quality of work life" (or "QWL") issues--concerns that the existing work rules for pilots in United's A320 and B-737 fleets were unreasonably burdensome. Evid. Hearing Tr. 308:15­309:21.

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On May 22, 2008, United and ALPA commenced negotiations regarding QWL issues, and ALPA provided United with a formal proposal. According to Wallach, this issue was important to him because "everything [he] had been hearing from the safety people, from the . . . schedule people, was that the rubber band was wound about as tight as it could be wound," meaning that "pilots were flying [the] maximum amount of hours that they would fly, that they had the minimum days off that they were entitled to, that there were no [] vacation drops," and "that if there was any event, weather event, any events whatsoever, that the operation was unsustainable." Evid. Hearing Tr. 882:11­883:2. During this negotiating session, Wallach asked to meet separately with two of United's negotiators, Managing Director of Labor StrategyFlight Jay Milone and Managing Director of Pilot Staffing and Scheduling Paul Carlson. In that meeting, Wallach told Milone and Carlson that ALPA wanted an agreement on QWL issues by the end of May 2008 and that if the parties had not reached an agreement by that date, there would be "consequences" that United would have to deal with. Evid. Hearing Tr. 309:1­25, 936:10­16. Milone testified that Wallach refused to explain at that meeting what he meant by "consequences," but that in light of the circumstances, Milone interpreted this as a threat that ALPA would accelerate its efforts to disrupt United's operations during the busy summer months. Evid. Hearing Tr. 310:1­8. The parties' negotiations over QWL issues were temporarily sidetracked by United's announcement on June 4, 2008 that it would reduce its fleet by 100 aircraft and its subsequent announcement that it would furlough approximately 1450 pilots. As a result of these announcements, the parties' negotiating committees agreed to devote their attention to negotiating a Furlough Mitigation Letter of Agreement, which ALPA viewed as more time

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sensitive because it would reduce the impact of the furlough announcement. In late June 2008, the negotiating committees reached agreement on a Furlough Mitigation Letter of Agreement, which was designed to minimize the number and effect of involuntary furloughs on the pilot workforce. That agreement was approved by the MEC on July 11, 2008. During this time period, the parties' negotiating committees continued to work on the QWL Letter of Agreement, and United also sought to address a request by ALPA for a Pilot Early Retirement Program ("PERP"). Around June 20, 2008, Wallach convened a special, multi-day, closed meeting of the MEC, the IRC, the SPC, and the Family Awareness Committee--a subcommittee of ALPA's SPC. About a week before that meeting, one MEC member had sent an email to the other members of the MEC, including Wallach, urging them to "ratchet up the heat" and declaring that "[t]he time has come to increase the level of risk in our plight to bring [United CEO Glenn] Tilton to his knees . . . . Now is the time to act boldly, decisively, and surgically." Pl.'s Ex. 223. On June 24, 2008, shortly after the MEC meeting, Wallach sent United a preliminary draft of a letter to all United pilots and told United that it should "stick it in their decision matrix" regarding the ongoing QWL negotiations. Pl.'s Ex. 224. The draft letter attacked both the competence and the motives of United management, and suggested that United "gave not a damn" about successful completion of the QWL negotiations. Pl.'s Ex. 224, at 3. Wallach testified that at the time he prepared this letter in late June, he "didn't have an anticipation o[f] when it would be sent" to United pilots. Evid. Hearing Tr. 944:8­14. On July 15, 2008, Wallach sent to United pilots a revised version of the draft letter he had previously sent to United. In that letter, Wallach informed United pilots that ALPA was

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terminating all negotiations with United, including both the QWL negotiations and the PERP negotiations. Like the draft sent to United on June 24, the letter attacked United's management and motives, declaring, "We face a focused, hostile and arrogant management group: a management group that gives not a damn about you, your well-being, or the well-being of your family." Pl.'s Ex. 83, at 1. The letter concluded with the statement, You will see renewed and focused efforts on the part of your union that will highlight the importance of United pilots' contributions to this airline. Do not discount the efforts all of us make each and every day that enable this company to operate. We cannot get out from under the present contract on time if we do not begin our work now. Stay connected, get on board and be unified. Pl.'s Ex. 83, at 4 (emphasis added). United's chief negotiator, Milone, testified that this was the first and only notice United received of ALPA's decision to terminate negotiations and that he viewed the letter as a "declaration of war" by Wallach. Evid. Hearing Tr. 315:10­316:2. Wallach testified that on the morning of July 14, 2008, he decided to terminate negotiations with United on the QWL agreement because "all of the proposals that the company continued to pass back and forth required, in my mind, offsets in order to pay for the pilots'[] quality of life improvements. And when we finally got to the end, it was just a matter of there is no more time, we're out of time, I'm done talking." Evid. Hearing Tr. 889:21­890:1 (emphasis added). Wallach explained that they were "out of time" because, in his view, the pilots were full of angst and "clamoring for information." Evid. Hearing Tr. 890:2­9. That explanation, however, raises nearly as many questions as it answers. First, what was the time constraint that ALPA and the pilots it represented were under? Second, what was the alternative to negotiating with United? At the time, ALPA had no other apparent options except, potentially, to implement a more widespread job action.

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By contrast, United has presented evidence that the parties' respective negotiating committees were making progress towards a QWL agreement. The committees had met several times over three weeks and had resolved a number of issues. Milone testified that he thought the parties had, in effect, reached an agreement, with the exception of one issue--"the proposal . . . to raise the line guarantee from 65 hours to 70 hours in [United's] scheduling construction system." Evid. Hearing Tr. 311:8­13. On the afternoon of July 14, 2008, Milone sent out a revised proposal that he thought would resolve that issue, though Wallach apparently did not receive it before making the decision to terminate negotiations. With regard to PERP negotiations, the record suggests that ALPA's negotiating committee simply never responded to United's proposal. The court finds that the more likely explanation for Wallach's decision to send the letter of July 15, 2008, was to foster among the pilots further indignation and animosity towards United and thus encourage them to engage in a more widespread job action on the basis that United would not agree to ALPA's proposals. Indeed, this option was outlined in an e-mail that Wallach received from an ALPA representative at the Denver LEC on July 11, 2008. In that e-mail, the author urged Wallach, If ever there were a place and time to call it "enough," I can't imagine a better time to walk away from the table and fight this fight. If for nothing else, it would be a unified position by this pilot group in the name of Safety--and oh by the way--cost neutral from our point of view, not theirs. If we never let our mandate materialize, we never had one. Pl.'s Ex. 229 (emphasis added); Evid. Hearing Tr. 951:1­25. Also, consistent with these actions, Wallach informed United in July 2008 that ALPA would be withdrawing from the agreement that the parties had reached in September 2007 28

regarding implementation of a web-based trip trading program. That agreement allowed pilots to trade a trip that had been assigned to them in the scheduling process for an unassigned trip that they might prefer. Milone testified that ALPA's withdrawal from this agreement will create a burden on pilots who desire trip trades, without providing anything to ALPA in return. Wallach's testimony that he did not see any progress in negotiations is further called into doubt by his failure to meet with United's new Senior Vice President of Flight Operations, Joseph Kolshak. On direct examination by defendants' counsel, Wallach testified that he had never met Kolshak, asserting that Kolshak had "never introduced himself to me," thus implying that Kolshak was not interested in sitting down with ALPA to work on improving the company's relationship with the union. Evid. Hearing Tr. 920:24­921:2. On cross-examination, however, Wallach admitted that Kolshak has been attempting to schedule a meeting with Wallach since as early as May 2008 but Wallach has declined to meet with him--purportedly on the basis that Wallach has "been busy." Evid. Hearing Tr. 923:3­17. C. The Elements of ALPA's Current Job Action ALPA's current campaign to force United to renegotiate the CBA does appear to mirror tactics that ALPA employed during the slowdown campaign of summer 2000, including refusal to accept voluntary flight assignments such as junior/senior manning; refusal to waive contractual provisions that pilots would normally waive; the creation of flight delays through lengthy pre-flight checks; and the creation of flight delays and cancellations by refusing to accept aircraft with deferrable maintenance items. Most recently, ALPA has encouraged a sickout among United's junior pilots that, combined with ALPA's campaign against acceptance of voluntary flight assignments, caused several hundred flight cancellations.

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1. Refusal to Accept Junior/Senior Manning "Junior/senior manning" is, essentially, a form of voluntary overtime under which United offers pilots flight assignments when the originally assigned pilot is unavailable and United does not have a reserve pilot available to cover the assignment. Pilots who accept such assignments receive a financial benefit or a scheduling benefit. Under the current CBA, United must offer junior/senior manning assignments in seniority order to pilots who have asked to be considered; if United cannot cover a flight in this manner, it must offer the flight in "inverse order of seniority" to all remaining available pilots. Def.'s Ex. 62, at 223. Until mid-2006, United was generally able to find a pilot willing to accept a junior/senior manning assignment. In situations where United has already utilized all available reserve pilots, a concerted refusal by pilots to accept junior/senior manning assignments can leave United with no option but to cancel flights. For more than a year and a half prior to the commencement of this litigation, ALPA had been discouraging pilots from accepting junior/senior manning assignments in order to put pressure on United to reopen the parties' CBA. For example, in the April 20, 2007 video message discussed above, MEC chairman Bathurst told United pilots that "[u]ntil our work rules and compensation are restored," pilots should "carefully consider" whether to accept junior/senior manning assignments. Pl.'s Ex. 1B, at 2. ALPA's campaign against junior/senior manning has been highly effective. For example, between January 2006 and April 2007, the number of pilots accepting requests for junior/senior manning averaged more than 430 per month. By comparison, between January and July 2008, the number of pilots accepting such requests has averaged only 83 per month.

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ALPA argues that the statistical analysis of the data presented by United's expert, Daniel Kasper, was flawed, in that he testified as to a decline since 2006 in the number of pilots "willing to accept" junior/senior manning assignments but did not account for the fact that United offered a decreased number of such assignments beginning in 2007. While defendants' crossexamination of Kasper revealed some limitations in his methodology,12 defendants did not call into doubt the overall soundness of Kasper's analysis, nor did they call an expert of their own to rebut Kasper's testimony regarding these, or any other, interpretations of the data. As to this particular objection, for example, neither party has suggested that United pilots would have accepted significantly more junior/senior manning assignments if United had made more such requests in recent months; on the contrary, the record indicates that in the months leading up to the filing of this lawsuit, the pilots were particularly unwilling to accept junior/senior manning assignments under any circumstances. In light of these factors, the court finds that the evidence--including, but not limited to, Kasper's expert testimony and report--firmly supports the conclusion that United pilots' willingness to accept junior/senior manning assignments has dramatically declined since 2006 and that this decline is closely correlated with ALPA's directives.

For example, on a similar note, ALPA suggests that in forming his opinions, Kasper did not adequately consider potential factors other than concerted behavior--such as the July 11, 2008 Furlough Mitigation Letter of Agreement--that may have caused changes in the pilots' behavior or otherwise influenced the data. 31

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2. Refusal to Waive the Contract ("Work-to-Rule") Under the labor agreement between United and ALPA, there are a number of rules and restrictions concerning duty time, flight time, and rest that can be waived with "pilot concurrence." Evid. Hearing Tr. 15:2­7. In a work-to-rule campaign, pilots refuse on a concerted basis to waive any contractual entitlement and, as described below, in virtually every ALPA publication over the last 18 months, ALPA has urged its members not to waive anything in the contract at any time. 3. Cockpit Check Delays In a work-to-rule action, a pilot can intentionally create flight delays by taking more time than necessary to complete pre-flight procedures, known as "cockpit checks." United maintains a system for tracking and categorizing all flight delays and cancellations. Under this system, every delay and cancellation is assigned one of roughly 40 codes regarding the typical reasons for delays or cancellations. ALPA asserts that the coding data on which United relies is unreliable because, for example, United management does nothing to audit the codes entered and "there is no sort of quality of assurance [sic] that goes through and evaluates" whether a particular code was entered accurately. Evid. Hearing Tr. 102:9­102:22. ALPA has offered little reason, however, to doubt the accuracy of such data. On the contrary, the record suggests that United has employed the coding system not in preparation for this or any other litigation, but in order to analyze and increase the efficiency of its operations--a purpose that creates incentive for the company to ensure the accuracy and integrity of the coding data.

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A delay caused by failure to complete cockpit checks in a timely manner is coded as a "KC" delay. Evid. Hearing Tr. 62:16­22. Since 2007, the number of KC delays, expressed as a percentage of all flights, has increased from less than three percent to more than six percent. Because United operates an average of 1,500 flights a day, this translates roughly to an additional 45 flights per day that have been delayed. Similarly, assuming an average of 150 passengers on each flight, this means that an additional 6,750 passengers per day have been subject to flight delays due to pilot cockpit check delays. 4. Minimum Equipment Delays and Cancellations Under FAA regulations, an airline is entitled to defer maintenance on a variety of equipment items--known as "deferrable," "minimum equipment list," or "MEL" items--that do not affect flight safety (e.g., a broken passenger reading light). Evid. Hearing Tr. 66:11-67:12. United provides its pilots with discretion, however, over whether to accept an aircraft with deferred maintenance issues because in some circumstances the nature of the planned flight or the nature of the equipment may make it prudent to repair the equipment even if not required under FAA rules. In a pilot job action, however, discretion can be used as a pretext for creating flight delays and cancellations by rejecting aircraft where the pilot has no sincere concern over safety. Under United's system, a flight delay or cancellation due to a pilot's refusal to depart with a deferrable maintenance item is coded "ME." Evid. Hearing Tr. 62:23­63:1. Since late 2006, the number of flights delayed for an "ME" reason, expressed as a percentage of scheduled flights, has increased six fold, from approximately 0.2 percent to more than 1.2 percent. Since the end of 2006, the number of flights cancelled each day for "ME" reasons has similarly

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increased from less than 0.05 percent to more than 0.30 percent. A one percent increase in flight delays would, on average, affect roughly 2000 passengers every day. This number, however, does not capture the "ripple effect" that a flight delay has on later flights because the aircraft is late in arriving at the destination airport. Evid. Hearing Tr. 71:4­20. ALPA asserts that the data presented by United show increases in both (a) delays for deferrable maintenance items, where pilots may have discretion, and (b) delays where an aircraft in fact needs repairs but cannot depart because the station does not have a necessary part. ALPA thus suggests that the increase in ME delays is consistent with a broader trend of delays due to repair issues and is not the result of pilots' inappropriately exercising discretion. As United points out, however, an increase in ME delays and cancellations may also create an increase in delays or cancellations of other flights for non-deferrable maintenance reasons because United must divert its maintenance resources from other aircraft, which also require maintenance, to deal with deferrable maintenance. Since the beginning of 2007, the average number of delays and cancellations for non-deferrable maintenance has increased from less than four percent to more than six percent, at least part of which may be attributable to the increase in ME delays and cancellations. 5. Increased Fuel Consumption The fuel required for a flight is determined in the first instance by United's dispatchers, who make this decision using computerized systems that take into account all relevant information regarding potential fuel use. Under United's policies, however, the captain may, in his or her discretion, add up to 2,000 pounds of additional fuel. On the one hand, adding additional fuel can, to some extent, provide pilots with more flexibility in dealing with

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unanticipated events that may arise, such as bad weather that requires a flight path diversion. On the other hand, adding unnecessary fuel increases the weight of the aircraft, which in turn increases the amount of fuel used, which in turn increases the cost of operating the flight. In his deposition, IRC Chairman Tamkin indicated that, "on and off" since 2007, the IRC--an ALPA committee that is primarily concerned with labor relations and job actions, not flight operations or safety--has had discussions with pilots encouraging them to carry more fuel. Tamkin Dep. 108:6­109:10. Since the beginning of 2007, the percentage of United A319/320 and B-737 flights where fuel was added increased from approximately 30 percent to a high of 47 percent before a recent decrease to just over 35 percent. 6. Increased Fatigue Calls Under United's policies, if a pilot believes that he or she is too fatigued to fly safely, the pilot is removed from the flight assignment, no questions asked. United alleges that ALPA has organized and encouraged a concerted effort by United pilots to use "fatigue" as a pretext, leaving United with flights that it cannot cover. In particular, United cites the IRC's decision in early June 2008 to launch a campaign to encourage pilots to refuse flight assignments on the basis of fatigue. Beginning in June 2008, fatigue calls have more than doubled, from their prior level of approximately 1 per day to more than 2.5 per day. ALPA asserts t