United Airlines 2011 Annual Report Download - page 28

Table of Contents
has multiple leases, which expire from 2022 through 2026 and include approximately 910,000 square feet of office space for its corporate headquarters and
operations center in downtown Chicago. Continental also leases approximately 511,000 square feet of office and related space for certain administrative offices
and an operations center in downtown Houston.
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Brazil Air Cargo Investigation
On July 31, 2008, state prosecutors in Sao Paulo, Brazil, commenced criminal proceedings against eight individuals, including United’s cargo manager, for
allegedly participating in cartel activity. Separately, Brazilian antitrust authorities initiated an administrative proceeding in order to verify the existence of a
cartel among certain airlines for the determination and implementation of a fuel surcharge, including United and its cargo manager. On January 4, 2010, the
Economic Law Secretariat of Brazil issued its opinion recommending that civil penalties be assessed against all parties being investigated, including United, to
the Administrative Counsel of Economic Defense (“CADE”), which is charged with making a determination on the matter. On August 30, 2011, the Brazil
Federal Public Prosecutor issued an opinion to CADE recommending the dismissal of the proceedings against United and its cargo manager, which is
currently under consideration by CADE. United continues to vigorously defend itself before CADE.
United is currently cooperating with this investigation and continues to analyze whether any potential liability may result. Based on its evaluation of all
information currently available, United has determined that no reserve for potential liability is required and will continue to defend itself against all allegations
that it was aware of or participated in cartel activities. However, penalties for violation of competition laws can be substantial and an ultimate finding that
United engaged in improper activity could have a material adverse impact on the Company’s consolidated financial position and results of operations.
United Injunction Against ALPA and Four Individual Defendants for Unlawful Slowdown Activity under the Railway Labor Act
On July 30, 2008, United filed a lawsuit in the United States Federal Court for the Northern District of Illinois seeking a preliminary injunction against ALPA
and four individual pilot employees for unlawful concerted activity that was disrupting the Company’s operations. The court granted the preliminary
injunction to United in November 2008, which was upheld by the U.S. Court of Appeals for the Seventh Circuit. ALPA and United reached an agreement to
discontinue the ongoing litigation over United’s motion for a permanent injunction and, instead, the preliminary injunction will remain in effect until the
conclusion of the ongoing bargaining process for an amended collective bargaining agreement that began on April 9, 2009. By reaching this agreement, the
parties are able to focus their efforts on the negotiations for the collective bargaining agreement. Nothing in this agreement precludes either party from reopening
the permanent injunction litigation upon 30 days’ notice or from seeking enforcement of the preliminary injunction itself.
EEOC Claim Under the Americans with Disabilities Act
On June 5, 2009, the U.S. Equal Employment Opportunity Commission (“EEOC”) filed a lawsuit on behalf of five named individuals and other similarly
situated employees alleging that United’s reasonable accommodation policy for employees with medical restrictions does not comply with the requirements of
the Americans with Disabilities Act. The EEOC maintains that qualified disabled employees should be placed into available open positions for which they are
minimally qualified, even if there are better qualified candidates for these positions. Under United’s accommodation policy, employees who are medically
restricted and who cannot be accommodated in their current position are given the opportunity to apply and compete for available positions. If the medically
restricted employee is similarly qualified to others who are competing for an open position, under United’s policy, the medically restricted employee will be
given a preference for the position. If, however, there are candidates that have superior qualifications competing for an open position, then no preference will be
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