2 FOR THE SOUTHERN DISTRICT OF NEW YORK x x

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1 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 1 of 35 1 UNITED STATES BANKRUPTCY COURT 2 FOR THE SOUTHERN DISTRICT OF NEW YORK 3 Case No (SHL) x 5 In Re: 6 7 AMR CORPORATION, et al., 8 9 Debtor x United States Bankruptcy Court 14 Southern District of New York 15 One Bowling Green 16 New York, New York April 10, :13 PM B E F O R E: 23 HON. SEAN H. LANE 24 U.S. BANKRUPTCY JUDGE 25 Page 1

2 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 2 of 35 1 Adversary proceeding: shl AMR Corporation v. Canada 2 Jr. et al Status Conference Re: Doc. #2 Motion to Extend 3 Automatic Stay - Motion of the Debtors to Extend the Automatic 4 Stay or, in the Alternative, for a Preliminary Injunction 5 Pending Ruling on Complaint and Memorandum of Law in Support 6 Thereof 7 8 Adversary proceeding: shl AMR Corporation v. Thomas et 9 al Status Conference Re: Doc. #2 Motion to Extend Automatic 10 Stay - Motion of the Debtors to Extend the Automatic Stay or, 11 in the Alternative, for a Preliminary Injunction Pending Ruling 12 on Complaint and Memorandum of Law in Support Thereof Doc. #1115 Motion to Vacate Motion of the Transport Workers 15 Union of America, AFL-CIO for Entry of an Order Terminating or, 16 Alternatively, Modifying the Automatic Stay to Permit Everton 17 Whites Prosecution of Discharge Complaint Against the Debtors 18 Solely to the Extent of the Debtors Available Workers 19 Compensation and/or Insurance Policy Fund Proceeds Doc. #1118 Motion to Vacate Motion of the Transport Workers 22 Union of America, AFL-CIO for Entry of an Order Lifting or 23 Modifying the Automatic Stay to Permit James Gregorio to 24 Institute Proceedings Against the Debtors for Improper Wage 25 Garnishment Page 2

3 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 3 of Status Conference Re: Doc. #602 Letter filed by Arthur Saenz. 3 4 Doc. #2047 Application to Employ Winstead P.C. as Corporate 5 Counsel Application of Debtors Pursuant to 11 U.S.C. 327(e) 6 and Fed. R. Bankr. P. 2014(a) for Authority to Employ and 7 Retain Winstead P.C. as Corporate Counsel for the Debtors Nunc 8 Pro Tunc to the Commencement Date 9 10 Doc. #2051 Application to Employ Harris, Finley & Bogle, P.C. 11 as Special Litigation Counsel for the Debtors - Application of 12 Debtors Pursuant to 11 U.S.C. 327(e) and Fed. R. Bankr. P (a) for Authority to Employ and Retain Harris, Finley & 14 Bogle, P.C. as Special Litigation Counsel for the Debtors Doc. #2052 Application to Employ Yetter Coleman LLP as Special 17 Litigation Counsel for the Debtors - Application of Debtors 18 Pursuant to 11 U.S.C. 327(e) and Fed. r. Bankr. P. 2014(a) 19 for Authority to Employ and Retain Yetter Coleman LLP as 20 Special Litigation Counsel for the Debtors Doc. #2053 Application to Employ Dewey & LeBoeuf LLP as Special 23 Litigation Counsel- Application of Debtors Pursuant to II 24 U.S.C.. 327(e) and Fed. R. Bankr. P. 2014(a) for Authority to 25 Page 3

4 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 4 of 35 1 Employ and Retain Dewey & Leboeuf LLP as Special Litigation 2 Counsel for the Debtors Transcribed by: Nick Gereffi Page 4

5 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 5 of 35 1 A P P E A R A N C E S : 2 WEIL, GOTSHAL, & MANGES LLP 3 Counsel for the Debtors Louisiana, Suite Houston, TX BY: ALFREDO R. PEREZ, ESQ SKADDEN, ARPS, SLATE, MEAGHER, & FLOM LLP 11 Counsel for the Committee North Wacker Drive 13 Chicago, IL BY: JOHN WM. BUTLER, JR., ESQ TOGUT, SEGAL & SEGAL LLP 19 Counsel for the Committee 20 One Penn Plaza 21 New York, NY BY: NEIL BERGER, ESQ Page 5

6 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 6 of 35 1 LOWENSTEIN SANDLER 2 Counsel for The Transport Workers Union 3 65 Livingston Avenue 4 Roseland, NJ BY: PAUL KIZEL, ESQ DEPARTMENT OF JUSTICE 10 Counsel for the U.S. Trustee Whitehall Street, 21st Floor 12 New York, NY BY: BRIAN S. MASUMOTO, ESQ Via Telephone 18 CARLIN & BUCHSBAUM 19 Counsel for Benja Divine East Ocean Blvd. 21 Long Beach, CA BY: LAUREL N. HAAG Page 6

7 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 7 of 35 1 HAMMONS, GOWENS, & HURST 2 Counsel for Tara Trammell Dean A McGee Avenue 4 Oklahoma City, OK BY: MARK HAMMONS, ESQ SCHUCHAT COOK WERNER 10 Counsel for John Michael Barron Locust Street, # St. Louis, MO BY: J. CHRISTOPHER CHOSTNER, ESQ GALLAGHER, SCHOENFELD, SURKIN, CHUPEN, & DEMIS 18 Counsel for Wallace Preitz West Second Street 20 Media, PA BY: RONALD H. SURKIN, ESQ Page 7

8 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 8 of 35 1 MARTIN & BONNETT PLLC 2 Counsel for Andrea Twitchell N. Central Avenue, # Phoenix, AZ BY: SUSAN MARTIN, ESQ. 7 8 LEWIS FEINBEG LEE RENAKER & JACKSON 9 Counsel for John Doe Ninth Street 11 Oakland, CA BY: CATHA A. WORTHMAN, ESQ LYNN FONTANA, ATTORNEY AT LAW 17 Counsel for Joan A. Gagliardo East Main Street 19 Durham, NC BY: LYNN FONTANA, ESQ Page 8

9 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 9 of 35 1 STEPTOE & JOHNSON LLP 2 Counsel for Allied Pilots Association Connecticut Avenue NW #700 4 Washington, D.C BY: JOSHUA TAYLOR, ESQ Page 9

10 Pg 10 of 35 1 P R O C E E D I N G S 2 THE COURT: Good afternoon. Please be seated. 3 We re here this afternoon for the sixth omnibus 4 hearing in the American Airlines case, and let me get 5 appearances. 6 MR. PEREZ: Good morning. Alfredo Perez, Your 7 Honor, on behalf of the debtors. Cathy Corriny (phonetic) with 8 the general counsel s office here as well. 9 MR. BUTLER: Good morning, Your Honor. Jack butler 10 from Skadden Arps on behalf of the Committee. 11 MR. BERGER: Good afternoon, Judge. Neil Berger, 12 Togut, Segal, and Segal, Co-Counsel to the Committee. 13 MR. MASUMOTO: Good afternoon, Your Honor. Brian 14 Masumoto for the Office of the United States Trustee. 15 MR. KIZEL: Paul Kizel, Lowenstein Sandler, on 16 behalf of the Transport Workers Union. We re here on a couple 17 of matters. 18 THE COURT: All right. 19 MR. PEREZ: Thank you, Your Honor. 20 MS. HAAG: Good afternoon, or good afternoon, Your 21 Honor. Laurel Haag on behalf of the creditor Benja Divine. 22 MR. HAMMONS: Yes, and Mark Hammons on behalf of the 23 creditor Tara Trammell. 24 MR. CHOSTNER: And Chris Chostner on behalf of 25 creditor John Barron. Page 10

11 Pg 11 of 35 1 MR. SURKIN: Ronald Surkin on behalf of creditor 2 Wallace Preitz. 3 MS. MARTIN: Susan Martin on behalf of creditor 4 Andrea Twitchell. 5 MS. WORTHMAN: Catha Worthman on behalf of creditor 6 John Doe. 7 MS. FONTANA: Lynn Fontana on behalf of creditor 8 Joan Gagliardo. 9 THE COURT: All right. Anyone else who s on the 10 phone who has a live appearance? 11 MR. TAYLOR: Joshua Taylor on behalf of Allied 12 Pilots Association. 13 THE COURT: All right. Thank you. 14 MR. PEREZ: Your Honor, the first two matters are a 15 status conferences on two adversary proceedings that the 16 debtors filed, the first one having to do with litigation 17 against defined benefit plans, and the second one having to do 18 with litigation against officers, directors, and one is a third 19 party. I believe the first matter, Your Honor, AMR versus 20 Canada, is the one having to do with the benefit plans, and in 21 connection with this matter, I know the Court wanted to have a 22 status conference, and I believe many of the parties on the 23 phone are representing the defendants in that matter. Page We ve had several discussions with the counsel. 25 Several have asked for an extension of time which to file an

12 Pg 12 of 35 1 answer, and subject to the Court s approval until, I believe, 2 May 10, and we have reached agreement with one party whereby we 3 would dismiss them form the lawsuit and they would agree that 4 the stay would remain in effect with respect to that. We re in 5 discussions with other parties. We did receive an answer from 6 Ms. Williams in the nature of a letter which I believe was sent 7 to the Court as well, and we reached out to her last night and 8 told her that this would be a status conference but that her 9 objection would be noted for the record, Your Honor. 10 THE COURT: All right. The reason I set it for a 11 status conference is -- the point was made when there was 12 originally a motion filed without an adversary that this had to 13 be done by adversary proceeding, and then I got -- we received 14 the motion in chambers, and then I realized, obviously, the 15 whole point of having certain things done by adversary is to 16 take advantage of a process, so I realized that, if the motion 17 had been put on a quickly -- on a track that, in fact, that the 18 underlying merits of the lawsuit would be resolved before 19 anyone ever had to file an answer, so what I wanted to do, 20 really, was talk about scheduling, which is what you ve jumped 21 right to. 22 MR. PEREZ: Right. 23 THE COURT: So, it -- what is it that would be an 24 open issue today in terms of scheduling this lawsuit? Page Obviously, the motion was filed -- I believe it s March 22, so

13 Pg 13 of 35 1 we re about two plus weeks from that date. It sounds like 2 there s -- you re working on a time for filing an answer, so 3 did you want to simply work out an agreed upon schedule, or do 4 you want to ask, at this point, for some sort of schedule in 5 terms of giving folks a chance to respond, but also getting the 6 matter on track. What would you like to do? 7 MR. PEREZ: Your Honor, we re certainly happy to 8 hear from the other counsel with respect to that, but I believe 9 -- if we give counsel until May 10 to respond, which would be 10 another twenty day -- another, in essence, month from now, if 11 possible, depending on the Court s calendar, if we could set 12 the preliminary, or -- either the motion or the preliminary 13 injunction hearing for the twenty-fifth, that would give 14 parties, in essence, six weeks from today to be ready for that. 15 I am hoping that we would have resolved most of these by then, 16 but if the Court s calendar permits, that might be the best 17 thing. 18 THE COURT: All right. I think we re already 19 scheduled to be here on May MR. PEREZ: Twenty-fourth. I m sorry. I got that 21 wrong. Page THE COURT: So -- all right. You know, that s fine. 23 I guess that would be perfectly fine from where I sit. I was 24 concerned, seeing the motion for injunctive relief, that there 25 was a need to act more expeditiously, but if that s something

14 Pg 14 of 35 1 the parties can agree upon in terms of the schedule, that seems 2 imminently reasonable. 3 MR. HAMMONS: Your Honor, may I ask -- this is Mark 4 Hammons on behalf of Ms. Trammell, who s an individual with a 5 third party claim, and her issue is with regard to extension of 6 a automatic stay to a non-party to the bankruptcy proceeding. 7 Are we addressing the status conferences as a whole, because 8 there are different claims and subjects of the March excuse me, March 22 motion. Is this a common scheduling order 10 that we re discussing, or is it only for the benefit 11 (indiscernible- 14:19:39) claims? 12 THE COURT: Well, I think it makes more sense to 13 have a common scheduling order, and certainly at a hearing, it 14 may be that -- and in the pleadings as well, that folks will 15 point out that they are different situated, and that could 16 result in several different things. It could result in a 17 different ruling, if a ruling is appropriate at that time; it 18 could also result in a decision that the facts aren t all in, 19 and there needs to be some additional development of some fact, 20 so -- however, at the same time, there are a lot of defendants 21 in each of these two adversary proceedings, and they re common 22 issues, so I think a single scheduling order would make sense. 23 Otherwise, it s going to get a little unwieldy, I think, for 24 both the parties and for the Court. Page MR. HAMMONS: Well thank you, Your Honor. I have no

15 Pg 15 of 35 1 objection to that, I want to make it clear. I simply wanted to 2 make certain that I was understanding the direction we were 3 going. Page 15 4 THE COURT: No, no, that s fine. I think, as you 5 may or may not know -- and, just for the benefit of folks who 6 may not have been following this particular bankruptcy case, we 7 have regularly scheduled hearings, and the idea is to funnel 8 matters that need to be resolved either by presenting some 9 agreement that folks have worked out or by having argument or, 10 if necessary, an evidentiary hearing, and we funnel them to 11 those what we call omnibus dates, so we have two of those a 12 month, so that would be the landing spot for this matter to be 13 heard, the motion to be heard, in each of these cases, so 14 that s really what we re trying to do. And certainly those 15 hearing dates, I m sure, you can get from debtor s counsel. 16 They are probably also on a website somewhere, but just to give 17 you a sense of the other reason to have these all stick 18 together is, even if we break them up, they re likely to 19 reunite magically at one of these hearing dates, so -- and 20 given that they re factually similar, so the legal issues are 21 similar, it probably is efficient, I think, for everyone to 22 start out that way, and if something changes at some point, we 23 can always cross that bridge if we come to it and we think it s 24 not appropriate have everybody in the same proceeding, or at 25 least on the same track in the same proceeding, but I don t

16 Pg 16 of 35 1 know too many judges who d want to start splitting off 2 defendants in litigation. It usually doesn t work out well for 3 anyone. 4 MR. HAMMONS: I understand, Your Honor. 5 MR. PEREZ: Your Honor, there are just -- there are 6 11 in the Canada case and 12 defendants in the Thomas case, so 7 there s 23 all together. 8 THE COURT: All right. Is there anybody else in the 9 Canada case who had any questions or comments concerning 10 scheduling? 11 MS. MARTIN: Yes, Your Honor. Your Honor, this is 12 Susan Martin from Phoenix, Arizona on behalf of Andrea 13 Twitchell. 14 My only question is whether, on the omnibus motion 15 date, we are permitted to appear by telephone, or did you want does Your Honor want us in the courtroom? Page THE COURT: Well, my general view is that particularly in a case like this where there are a lot of 19 people across the country who have interests that need to be 20 represented and they need to follow proceedings like this I m always happy to have people appear by phone for anything 22 that is not the merits, so, for example, today s conversation s 23 a perfect example. We can save some expense because we re 24 talking about scheduling. When we ultimately come down to 25 arguing the merits, however, I would think that I do want folks

17 Pg 17 of 35 1 here. Now, it may be that, amongst the counsel who are 2 defendants, that you essentially appoint a spokesperson to 3 address the main legal issues to the extent that they re 4 overlap of issues and that that is something that people who 5 are not going to be that counsel decide that they are happy to 6 be available by phone to answer questions, but if you re going 7 to argue on a dispositive motion like this, which I imagine is 8 a dispositive motion in terms of the relief that s been 9 requested, that you should be here in person, so MR. HAMMONS: Would we be -- excuse me, Your Honor. 11 Mark Hammons again. That would be for the May 24 preliminary 12 objection hearing proceeding? 13 THE COURT: Correct, preliminary objection hearing 14 on the twenty-fourth of May. 15 MR. HAMMONS: And if I may be clear, Your Honor, 16 under the schedule that s being proposed with May 10 answer 17 date and a hearing on May the twenty-fourth, then discovery is 18 going to be immediately allowable in preparation for that 19 hearing. In other words, we can send out our discovery now. 20 THE COURT: Well, I hadn t -- we hadn t gotten to 21 that part of the program, but we are getting there shortly. 22 Let me ask Mr. Perez if there s been any discussions or 23 agreements worked out in connection with discovery. Page MR. PEREZ: Your Honor, there have not been any 25 agreements worked out, but I would imagine that -- you know,

18 Pg 18 of 35 1 the legal issues are fairly straight forward. I mean, and 2 we ve necessitated our case in our motion to the extent that 3 there s discovery with respect to the legal issues that we ve 4 raised. Not on the merits of the underlying claim, because 5 that s something different. I mean, we re certainly happy to 6 respond to discovery. They can send it out now, if that s what 7 they wish. 8 THE COURT: All right. I think that s an imminently 9 sensible way to handle it, so if you have information that you 10 need -- so, for example, there s a question about whether your 11 lawsuit against a particular party will ultimately -- would 12 ultimately be paid and a judgment would be paid by a debtor in 13 this case or the cost of defense would be born by a debtor in 14 this case, things of that sort, that would be appropriate 15 discovery. We re not, on the twenty-fourth of May, going to be 16 talking about the merits of these cases in terms of deciding 17 whether somebody s entitled to prevail. That s not what the 18 lawsuit is about. You have your own separate lawsuits. This 19 is really just a question about whether the automatic stay 20 should apply to these particular actions. Page So I think that you should talk to each other in 22 terms of working out what sort of information you need, and I 23 can t imagine that that can t be worked out. So, when in 24 doubt, pick up the phone rather than fire off a nasty letter. 25 If there is a need to resolve any discovery disputes, I can t

19 Pg 19 of 35 1 say that I m anxious to be involved in that process, but I 2 would much prefer to be involved in that process than to see 3 motion practice, which is usually expensive without adding much 4 to the underlying dispute, so work together on that. 5 Let me just get a sense from you, Mr. Perez: if the 6 answer date, both for the responding to the motion, responding 7 to the complaint is May -- going to be May 10 for all parties, 8 then I imagine you ll work in some date for the debtors to file 9 any reply brief as well? 10 MR. PEREZ: We ll reply a week later. 11 THE COURT: All right. 12 MR. PEREZ: And then it s -- fourteen days before 13 the hearing date, we ll reply seven days before the hearing 14 date. 15 THE COURT: All right. So, if you want to present 16 that schedule to me, that would be fine. If it s a stipulation 17 or -- I m not sure if you have everybody on board or exactly 18 where that stands. 19 MR. PEREZ: I don t know whether we have -- I mean, 20 I don t know. We ve talked to many of the counsel, and in 21 fact, Your Honor, with respect to at least one, we actually 22 have a signed stipulation, which we will file under a notice of 23 presentment removing them from this case. 24 THE COURT: All right. Well, let me just, in an 25 abundance of caution, ask if anyone who s on the phone Page 19

20 Pg 20 of 35 1 representing parties in this particular case -- that is the 2 Canada case -- has any problem with the schedule that s been 3 proposed that I m considering? 4 MR. HAMMONS: On behalf of Ms. Trammell, no, Your 5 Honor. This is Mark Hammons. 6 MR. SURKIN: Your Honor, Ron Surkin on behalf of 7 Wallace Preitz. No problem with that. 8 MR. CHOSTNER: Chris Chostner on behalf of John 9 Barron. We do not have a problem with that. 10 THE COURT: All right. I don t hear any objections, 11 so I wouldn t go the stipulation route. 12 MR. PEREZ: Okay. An order. 13 THE COURT: Just, again, we -- you filed a motion to 14 ask for a hearing date, and we asked you to put to be 15 determined, so we re just essentially setting a hearing date 16 for this. 17 MR. PEREZ: Thank you, Your Honor. 18 And, Your Honor, I m sure it goes without saying, and 19 while we certainly don t anticipate that anything would come up 20 between now and May 24 that would require the Court s 21 intervention, but to the extent something comes up that would 22 be prejudicial to the debtor, we obviously would reserve the 23 right to come back on notice. Page THE COURT: Absolutely, and what I would ask is if 25 there are any steps in the litigation that may impact what I m

21 Pg 21 of 35 1 being asked to decide in this adversary proceeding, please talk 2 to each other. It ll prevent us from all having to run into 3 court on short notice and less than perfect information, so if 4 there s a large step that s being contemplated in one of these 5 actions for which the debtors have asked a stay to be extended, 6 pick up the phone again and talk to each other and see what you 7 could work out. It s much preferable to having to deal with 8 motion practice on the issue, given that we ll be talking to 9 each other fairly soon on it anyway. 10 MR. HAMMONS: Your Honor -- real fast. If I may, 11 this is Mark Hammons again. 12 I had called in earlier because I do have a 13 scheduling conflict. I have a court appearance that requires 14 me to get on the road. If I could be, it sounds to me like the 15 schedule has been set; could I be excused from the balance of 16 this hearing? 17 THE COURT: Absolutely. We did get your request, 18 and so off you go. 19 MR. HAMMONS: Thank you very much, Your Honor. 20 THE COURT: Absolutely. 21 MR. SURKIN: Your Honor, this is Ron Surkin for Mr. 22 Preitz. I just have one question in terms of, is there an 23 attorney representing the debtor who would be our principal 24 contact to deal with on these cases? Page MR. PEREZ: For now, it should probably should be

22 Pg 22 of 35 1 me, Alfredo Perez. 2 MR. SURKIN: Okay. 3 MR. PEREZ: And it probably won t be me, but start 4 with me to begin with. 5 MR. SURKIN: Start with you. Okay. And Mr. Perez, 6 which firm are you with? 7 MR. PEREZ: I m with Weil Gotshal. 8 MR. SURKIN: Okay. Thank you. 9 THE COURT: You ll find all that contact information 10 in the complaint. 11 MR. PEREZ: Yeah. 12 MR. SURKIN: Very good. 13 THE COURT: All right. So, anything else we need to 14 discuss in connection with the first adversary proceeding? 15 MR. PEREZ: No, Your Honor. 16 THE COURT: All right. So, moving on to the second 17 one. 18 UNKNOWN SPEAKER: Your Honor -- Page MR. PEREZ: The second one, Your Honor, is the AMR s motion against twelve defendants in connection with 21 extending the stay to officers, directors, and, in one case, 22 one of our plan administrators. Unfortunately, I think that 23 Mr. Hamilton, who represented Ms. Trammell, actually was in 24 this case as opposed to the Canada case, so I think there was a 25 little confusion there and I apologize for that, so I believe

23 Pg 23 of 35 1 some of the individuals who spoke already spoke on the second 2 case. 3 THE COURT: All right. Is it contemplated to follow 4 the same track in the second case? 5 MR. PEREZ: Yes, Your Honor. 6 THE COURT: All right, so then his comments are 7 equally probative now, so we ll just import them wholesale. 8 All right. Is there anybody who wants to be heard in 9 connection with setting the same schedule for this second 10 adversary, AMR Corp. versus Thomas et all, which is ? 11 All right, so I think I d contemplate, then, getting a second 12 scheduling order for that case that would mirror the one for 13 the first one. 14 MR. PEREZ: We ll provide that. And, Your Honor, I 15 have to apologize in advance. I have left the office without 16 bringing the order, so they were going to have to it. 17 THE COURT: That s fine. We ll be here all week. 18 So, folks who are on for those two adversary 19 proceedings, I think we re done with those, so feel free to 20 drop off. You ll be expecting to get a copy of a scheduling 21 order that will be entered consistent with what we ve talked 22 about. 23 VARIOUS: Thank you, Your Honor. 24 THE COURT: Thank you. Page MR. PEREZ: Okay. Your Honor, the next matter is

24 Pg 24 of 35 1 the Everton White matter. 2 The Court will recall Mr. White had filed a motion to 3 lift stay to proceed with a worker s comp claim. Mr. White had 4 three pending actions; a lawsuit in the Eastern District of New 5 York, an arbitration, as well as the filed worker s comp. The 6 arbitration -- and they re all, in essence, sought the same 7 relief. They alleged wrongful discharge and they wanted to be 8 reinstated and back paid. The arbitration has been concluded 9 as of March 15, and we are waiting for the arbitrator s ruling, 10 at which point we will abide by the arbitrator s ruling. I 11 think that, with that being said, there s -- the motion s, at 12 this point, moot, because, in essence, it sought the same 13 relief as the relief that they were seeking by the arbitrator. 14 THE COURT: All right. Anyone want to be heard? 15 MR. KIZEL: Paul Kizel from Lowenstein Sandler on 16 behalf of the Transport Workers Union. 17 We did file this motion. There was, as counsel 18 indicated, matters heard at the last hearing. It was carried 19 to today. There have been discussions between the parties, and 20 what counsel has said is accurate and it should resolve the 21 matter. 22 THE COURT: All right. Page MR. KIZEL: So, again, it s our understanding that 24 whatever the arbitrator rules, the company will abide by that. 25 If it requires reinstatement at that point, Mr. White will be

25 Pg 25 of 35 1 reinstated. If there s any back pay issues, it s our 2 understanding that the company will honor that. To the extent 3 any of that back pay represents a priority claim up to the cap, 4 the company will honor that too. We understand it won t be 5 embodied in the order, but that s -- those are the discussions 6 we have had. 7 THE COURT: All right. What would you like to do, 8 then, in connection with this motion? Do you want to withdraw 9 it with prejudice? Do you want to enter into a stipulation 10 that says what you just said, although it clearly is on the 11 record of this proceeding so I don t know that we need to waste 12 the paper. 13 MR. KIZEL: Your Honor, as long as it s in the 14 record of this proceeding, that s fine with us. We could 15 always order the record of the hearing. 16 THE COURT: All right. I can t imagine you have too 17 many debates about what was agreed to. 18 MR. KIZEL: Right. 19 THE COURT: So, what I expect that you would just 20 file some sort of notice withdrawing the motion without 21 prejudice. 22 MR. KIZEL: That s fine, Your Honor. 23 THE COURT: All right. Thank you. Page MR. PEREZ: Your Honor, next matter that the Court 25 wanted us to report on was the Gregorio matter, and the Court

26 Pg 26 of 35 1 will recall this was a $907 paycheck amount that was removed 2 from the paycheck. Unbeknownst to me until last 24 hours, Mr. 3 Gregorio had already been paid in February the $900 back, so we 4 had the hearing last week. Unfortunately, we didn t have all 5 the facts. 6 THE COURT: All right. 7 MR. PEREZ: So we ve now -- he s now signed 8 promissory note to repay that in increments, and he ll have an 9 unsecured prepetition claim for $970, so it s MR. KIZEL: Your Honor, that s our understanding as 11 well. The money will be repaid over a certain time period that 12 would be reflected in the note, and I believe it s our 13 understanding -- we agreed that we will embody the sending 14 order. 15 THE COURT: All right. 16 MR. KIZEL: Which THE COURT: I ll wait for a stipulation order MR. KIZEL: Right. 19 THE COURT: -- from the parties on this. 20 MR. KIZEL: Right. 21 THE COURT: And that way I don t have to ponder how 22 a civil authority can bring a criminal action in Florida as to 23 garnishment, which is a serious question for me, but MR. KIZEL: Which had already been repaid, which 25 that was our fault for not knowing. Page 26

27 Pg 27 of 35 1 THE COURT: That s fine, and it -- well, these 2 things happen, so it s fine. I appreciate the parties talking 3 to each other and trying to work these things out. 4 MR. KIZEL: Yep. 5 MR. PEREZ: Which then, Your Honor, brings us to 6 Saenz, and unfortunately Saenz is a little more complicated. 7 We ve done extensive diligence on trying to resolve the issue. 8 What we ve learned -- and I believe the Court denied the 9 motion, but wanted us to report back and see if we could 10 resolve it. 11 THE COURT: Right. Yeah. My take on it -- and 12 again, I won t profess to be at all knowledgeable about all the 13 ordinary course of business procedures that the airline might MR. PEREZ: Right. 16 THE COURT: -- have to address situations like this, 17 but it appeared, from his letter, that he was a serviceman 18 stationed overseas, if I m reading it correctly, and that he 19 was owed some $1,800. It was because he d booked the ticket in 20 Saudi Arabia. It was sent back to Saudi -- that money was sent 21 to Saudi Arabia, and I think all he s looking for is somebody 22 to sort of locate the check. 23 MR. PEREZ: Right. 24 THE COURT: So MR. PEREZ: It s actually a little bit more Page 27

28 Pg 28 of 35 1 complicated, after did the digging. In fact, he did -- he is a 2 serviceman. He booked the ticket for his daughter, and the 3 notation is that it s a government invoice, so, on three 4 occasions, we ve gone back to Saudi Airlines, who actually 5 booked the ticket, to return the money to them. They have 6 never accepted it, so we re still in a little bit of a 7 quagmire. We understand that we owe them the $1,800, or 8 thereabouts, but we don t know who should be the recipient of 9 that money THE COURT: All right. 11 MR. PEREZ: --because it was a government invoice. 12 THE COURT: And I assume that he can t get paid 13 until they get paid because they would be the ones paying him 14 back? 15 MR. PEREZ: Exactly. 16 THE COURT: So am I right in assuming that, when you 17 do eventually figure out who at Saudi Airlines will be the 18 recipient of this money, that, at the same time, you can give 19 them his contact information MR. PEREZ: Absolutely. 21 THE COURT: -- so they know where to send the check? 22 MR. PEREZ: Absolutely. Absolutely, we can do that. 23 And, Your Honor, we reached out back in June when the original 24 issue came up and we ve reached out twice in the last month to 25 prod that along. Page 28

29 Pg 29 of 35 1 THE COURT: All right. Thank you. 2 MR. PEREZ: Okay. 3 THE COURT: So do we want to just -- I guess I ll 4 wait for further update -- 5 MR. PEREZ: Yes. 6 THE COURT: -- from you all on this. 7 MR. PEREZ: I believe the Court has already denied in essence denied the motion -- 9 THE COURT: Yes. 10 MR. PEREZ: -- but wanted an update. 11 THE COURT: All right. Yeah. It would seem that 12 what he s asking for is something that probably can be 13 accomplished, although it sounds like it s MR. PEREZ: It s a little bit THE COURT: -- one of those many things in life 16 that s a little more difficult than it might appear. Page MR. PEREZ: And then, Your Honor, the last four 18 matters on the agenda are uncontested retentions of -- all of 19 these counsel started out as 327(e) counsel. Three of them Yetter Warden (phonetic), Finley Harris, and Dewey LeBoeuf are all involved in connection with the GDS litigation, and 22 while the GDS litigation is very substantial, at the time, it 23 was unclear whether the stay would be lifted or not. Had the 24 stay not been lifted, it clearly would have come in under (e) and those, but the stay was lifted very shortly,

30 Pg 30 of 35 1 probably in December, so they ve been going and so they -- the 2 caps were significantly exceeded. Winstead, likewise, does a 3 lot of -- it s a local firm in Dallas that does a lot of work 4 for American on -- not on any particular matter, but just kind 5 of a regular firm for them, and again, they ve blown through 6 the caps, so that s why we re retaining them. 7 THE COURT: All right. Does anyone want to be heard 8 in connection with the three applications to employ and retain 9 firms, three of which are involved in, I guess it s called the 10 Saber litigation? 11 MR. PEREZ: Saber litigation, Your Honor, correct. 12 THE COURT: As well as the Federal Antitrust 13 litigation in the Northern District of Texas, and the other one 14 essentially being General Corporate Counsel MR. PEREZ: Right. 16 THE COURT: -- in terms of services. 17 MR. MASIMOTO: No objection, Your Honor. 18 THE COURT: All right. All right, I will grant 19 those applications. 20 MR. PEREZ: Thank you, Your Honor. 21 THE COURT: Thank you. 22 MR. PEREZ: Your Honor, that concludes the agenda 23 for today, unless the Court has anything. Page THE COURT: All right. I just had two -- I had a 25 couple of scheduling things. One is I just wanted to confirm

31 Pg 31 of 35 1 that I think we are on for a status conference in connection 2 with the retention of Deloit (phonetic) coming up, but am I 3 correct it s the thirteenth? 4 MR. MASIMOTO: That s correct, Your Honor. 5 MR. PEREZ: Yes. 6 THE COURT: So I m hopeful that will be good news 7 and we won t have to have a hearing on that, but certainly if 8 the parties work out something before we have the call, just 9 give chambers a ring and let us know. 10 MR. PEREZ: At eleven o clock. 11 THE COURT: I believe that is MR. PEREZ: I keep saying two, but I think you keep 13 saying eleven. 14 THE COURT: Without a calendar in front of me, I 15 wouldn t trust anything that I have to say. 16 MR. PEREZ: I ll check. 17 THE COURT: Eleven o clock is correct. 18 MR. PEREZ: Okay. Page THE COURT: You are correct, so that was one matter. 20 The other is I think there was a question that came 21 up -- and I guess, on the grand scheme of problems in life, 22 it s a -- it s not that bad because it s in June, but we have 23 two hearings scheduled in June, and one s June 5th and one s 24 the twenty-eighth, and I think there was a request to move the 25 twenty-eighth to earlier -- that is, to sometime on the twenty-

32 Pg 32 of 35 1 first -- because of a particular issue that s going to be teed 2 up by the debtors that has some timing sensitivity visa vie the 3 twenty-sixth, and I know there ve been conversations with 4 debtor s counsel and chambers about that. Here s the 5 difficulty, is between -- on the twentieth, twenty-first, and 6 twenty-sixth, we currently -- I currently have hearings in 7 three Mega cases that -- any one of which could be quite time 8 consuming, so I d prefer not to have them all consecutively, so 9 -- and add a fourth to a period of only about five business 10 days. So, I m happy to move the twenty-eighth up. My question 11 is, since we have one on the fifth, whether you wanted to move 12 it up to something like the eighteenth, but I think the date 13 you d asked for, the twenty-first, is a bit of a challenge 14 because I have another case on that date that s an omnibus, and 15 the twenty-second, I d prefer not to just not have three or 16 four of these of the largest cases that I have all in a row one 17 day after the next, so MR. PEREZ: Sure. 19 THE COURT: So, please just keep talking with 20 chambers, but I just figured I wanted to explain to you the 21 challenges and why I m just not in a position to give you the 22 date you ve requested, but certainly we could move it up if the 23 twenty-eighth is a timing problem. Page MR. PEREZ: Your Honor, the issue is our two hundred 25 twentieth day comes on the twenty-sixth. That s what s driving

33 Pg 33 of 35 1 us. 2 THE COURT: All right. 3 MR. PEREZ: So I ll -- I understand the Court s 4 comments. 5 THE COURT: Yeah. Just take a look at it. The 6 eighteenth, I think, would be fine. I think people were 7 batting around the twenty-second in the afternoon, but again, 8 I d prefer not to have three of these in a row, and I just 9 don t know where some of these cases are going to be and 10 there s a good chance that, of these three other cases, that 11 there s going to be some significant hearings, perhaps even 12 evidentiary matters, that need to be resolved, so I don t want 13 the date to be dead in the water the minute I give it to you. 14 MR. PEREZ: All right. 15 THE COURT: So -- but let me know. We also, if 16 worst comes to worst, we can try to move some other things 17 around, and since it s June, I m sure we ll have time to figure 18 it all out. 19 MR. PEREZ: Thank you, Your Honor. 20 THE COURT: All right. Anything else we need to 21 chat about this afternoon? All right. Thank you very much (Whereupon these proceedings were concluded at 2:43 PM) Page 33

34 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 34 of 35 1 I N D E X 2 3 RULINGS 4 Page Line 5 Motion to Vacate Motion of the TWU Modifying The Automatic Stay to Permit Everton Whites 7 Prosecution of Discharge Complaint- withdrawn 8 Motion to Vacate Motion of the TPU Lifting Automatic Stay to Permit James Gregorio to 10 Proceed Against the Debtor- adjourned 11 Application to Employ Winstead P.C. as Counsel- granted 13 Application to Employ Harris, Finley, & Bogle P.C. as Counsel- granted 15 Application to Employ Yetter Coleman LLP as Counsel- granted 17 Appliocation to Employ Dewey & LEBeouf LLP as Counsel- granted Page 34

35 shl Doc 9 Filed 04/12/12 Entered 04/16/12 15:25:20 Main Document Pg 35 of C E R T I F I C A T I O N 3 4 I, Nick Gereffi, certify that the foregoing transcript is a 5 true and accurate record of the proceedings NICK GEREFFI Veritext Old Country Road 14 Suite Mineola, NY Date: April 11, Page 35