US Airways 2010 Annual Report Download - page 30

Table of Contents
Item 3. Legal Proceedings
On September 12, 2004, US Airways Group and its domestic subsidiaries (collectively, the "Reorganized Debtors") filed voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Eastern District of Virginia,
Alexandria Division (Case Nos. 04-13819-SSM through 03-13823-SSM) (the "2004 Bankruptcy"). On September 16, 2005, the
Bankruptcy Court issued an order confirming the plan of reorganization submitted by the Reorganized Debtors and on September 27,
2005, the Reorganized Debtors emerged from the 2004 Bankruptcy. The Bankruptcy Court's order confirming the plan included a
provision called the plan injunction, which forever bars other parties from pursuing most claims against the Reorganized Debtors that
arose prior to September 27, 2005 in any forum other than the Bankruptcy Court. Substantially all of the claims in the 2004 Bankruptcy
have been settled and the allowed claims have been paid out in common stock of the post-bankruptcy US Airways Group at a small
fraction of the actual claim amount. However, the effects of these common stock distributions were already reflected in our consolidated
financial statements upon emergence from bankruptcy and will not have any further impact on our financial position or results of
operations. We presently expect the bankruptcy case to be closed during 2011.
We are party to an arbitration proceeding relating to a grievance brought by our pilots union to the effect that, effective January 1,
2010, this work group was entitled to a significant increase in wages by operation of the applicable collective bargaining agreement. A
hearing was conducted and the parties are awaiting the ruling of the arbitrator. An adverse ruling by the arbitrator could require a material
increase in the wages of our pilots and a material back payment to make the wage increase retroactive to January 1, 2010. We believe that
the union's position is without merit and that the possibility of an adverse outcome is remote.
We are defendants in various pending lawsuits and proceedings, and from time to time are subject to other claims arising in the normal
course of our business, many of which are covered in whole or in part by insurance. The outcome of those matters cannot be predicted
with certainty at this time, but we, having consulted with outside counsel, believe that the ultimate disposition of these contingencies will
not materially affect our consolidated financial position or results of operations.
Item 4. [Removed and Reserved]
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