United Airlines 2014 Annual Report Download - page 25
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Table of Contents
Environmental Proceedings
In 2001, the California Regional Water Quality Control Board (“CRWQCB”) mandated a field study of the area surrounding Continental Airlines, Inc.’s
aircraft maintenance hangar in Los Angeles. The study was completed in September 2001 and identified aircraft fuel and solvent contamination on and
adjacent to this site. In April 2005, Continental began environmental remediation of aircraft fuel contamination surrounding its aircraft maintenance hangar
pursuant to a workplan submitted to and approved by the CRWQCB and its landlord, the Los Angeles World Airports. The Company could be responsible for
environmental remediation costs related to contamination on and near this site. The Company accrued a reserve in an amount expected by the Company to
cover environmental remediation costs for this site.
On January 13, 2014, United received an offer of settlement from the Bay Area Air Quality Management District for three Notices of Violation (“NOVs”)
issued in 2012 and 2013 to United’s San Francisco maintenance center (the “Maintenance Center”). The NOVs relate to the frequency of filter replacement
for painting booths and associated recordkeeping at the Maintenance Center. Under the NOVs, the Company could be responsible for paying a civil penalty.
The Company accrued a reserve in an amount expected to cover any settlement of the NOVs.
Other Legal Proceedings
The Company is involved in various other claims and legal actions involving passengers, customers, suppliers, employees and government agencies arising
in the ordinary course of business. Additionally, from time to time, the Company becomes aware of potential non-compliance with applicable environmental
regulations, which have either been identified by the Company (through internal compliance programs such as its environmental compliance audits) or
through notice from a governmental entity. In some instances, these matters could potentially become the subject of an administrative or judicial proceeding
and could potentially involve monetary sanctions. After considering a number of factors, including (but not limited to) the views of legal counsel, the nature
of contingencies to which the Company is subject and prior experience, management believes that the ultimate disposition of these contingencies will not
materially affect its consolidated financial position or results of operations.
The Company and certain of its executive officers and employees have received federal grand jury subpoenas requesting records and testimony related to
certain individuals formerly associated with the Port Authority of New York and New Jersey and related operations of the Company and the Company is
conducting an internal investigation in response. The Company is cooperating with the government’s investigation.
Not applicable.
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