Airline Pilot Central Forums - View Single Post - Mesa Mesa Mesa...the standard of the industry

10-01-2007, 09:12 AM

ERJ Driver

Gets Weekends Off

Joined APC: Jul 2007

Position: ERJ CA

Posts: 299

Enjoy some light reading...

Here are some facts and figures you should be aware of if you are still 'sitting on the fence' on whether or not Mesa will be in operation in the near future.

By the end of this November over 250 pilots will have timed out for the year. Just in time for the busy holiday season.
The company continues to lose on average 25 to 35 pilots a month. Link: http://tinypic.com/view.php?pic=14vtp4i&s=2 (be sure to click on 'Full Size')
Average IOE time for new pilots coming online is between 50 to 85 hours. Some pilots are even taking over 100 hours to be line qualified.
Based on only 2 days of testimony I think we can safely say that some type of monetary judgment will be levied against Mesa. Also, remember that this is only the first trial, Mesa goes up against Aloha next.
Mesa use to have $300 million dollars in liquid cash which was raised through a number of institutional investors. In the last year and a half the company has burned through $122 million of that reserve and needless to say many of Mesa's investors are none to happy about the financial situation of the company.

Day 1 Testimony is a little dry but Day 2 is pure Jonathan. Enjoy.
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Day 1:

Englander testified that he was provided with 3 hard drives from Murnane's computers. Two were eoffice laptops and one was a home computer. The two office hard drives had evidence of only a few deleted files, while the home drive had about 169,000. The latter is typical of a normal computer. The first two were obviously reformatted recently and wiped clean. There was evidence that Murnane asked a co-worker via e-mail “How do I permanently delete files from my hard drive so that it cannot be detected that I have deleted them?” There was evidence that Murnane used Drive Scrubber software to replace all of the deleted files on the two hard drives and some on the third (home) drive with a hexcharacter. While this did, indeed, make the deleted files completely unrecoverable, it stood out because normally when a file is deleted it actually stays on the drive until another file is written over it. OnMurnane's drives there was about 10 gigabytes of '3030303030 . . .

There was testimony that Murnane also back-dated the computer. The expert looked at the system logs on the drive which are organized sequentially in order of occurrence, not by date. He noticed that somefiles had been modified 1 year BEFORE their creation date. He then determined that the clockr esetting happened while the computers were in Murnane's possession because he had (1) bid on an e-bay item during the period in which the clock-resetting/ file deletion happened, and (2) he had logged into Mesa's network using his personal login information during that period, the fact of his login being logged in the system log.

On cross examination Mesa's attorney, Max Blecher asked if perhaps Murnane was deleting the files because he knew that the computer was broken and he was trading it in for a new one. Englander responded that Murnane knew he could swap out the drive and that it was unlikely that he would scrubthe drive and back date the computer clock for this reason. Blecher also asked if Murnane delete the items to hide the fact that he had been viewing porn on the computer. Englander said that this was very unlikely as he had never seen this scale of deletion just to hide porn surfing

Files were deleted from the 'H:' drive on Mesa's server. These files were in a directory entitled “M & A Opportunities/ Hawaiian” There was also an “Island Air” folder. (Aloha not mentioned). Mesa stated that they had backups of the files from this directory and that the files were provided to HAL, however,Blecher's cross examination on this point was disconnected and almost incoherent. Clearly he is not familiar with the workings of computers

As Englander was an 'expert witness' he was allowed to provide his opinion. He concluded:
1) Murnane used Sys Mechanic Pro 6/ Drive Scrubber to overwrite unallocated space on laptops 1& 2 and then tried to set the clock backwards to hide evidence of use of the program.
2) Murnane actively researched how to delete files permanently and without trace
3) Murnane was the user at the time the files were deleted and scrubbed and the clock was reset
4) The actions by Murnane were deliberate. ---

Mesa's witnesses:

1. Jennifer Johnson is one of Max Blecher's paralegals who helped prepare documents for production to HAL. She testified that all of the deleted documents from the H: drive were produced to HAL in some form or another. Her testimony was based on two lists that she was shown. On cross it was determined that she did not make the lists herself, and that some of the documents produced were not exact reproductions of the missing docs

Pappaianou, Mesa's V.P. of Legal testified that Murnane's home computer was sequestered after March 2006, (but not the two office laptops), that one of Murnane's laptops broke in July, 06, at which time he was provided with another one, and that he walked in on Murnane and observed porn on Murnane'scomputer. He testified that he did not know that Murnane had deleted documents until September of this year. He testified that after the Preliminary Injunction hearing last year, when it was determined that Murnane was lying in court (both Pappaianou and Blecher stated this!) Murnane's home laptop was sequestered. HAL's attorney Sid Levinson wisely cross-examined Pappaianou asking “if you knew he was dishonest, why did you not try to investigate/ prevent him from deleting files/ destroying evidenceon the other two laptops and the company server?”

On cross Murnane's testimony that he had copied everything onto his home computer except documents with HAL/ HA/ Hawaiian was discussed. (This evidence directly contradicted earlierevidence that laptop 3 had HAL/ HA/ Hawaiian docs on it).

Levinson got Pappaianou to admit that although he asked J.O., Lotz, and Murnane to preserve evidence for discovery, he never asked the I.T. department to save files until after the preliminary injunction (9/06), more than 6 months after the case had been filed and 6 months after he sent the e-mail to J.O.,Lotz, and Murnane asking them to preserve files.

Other testimony:A critical document entitled the “HAL Offering Memo” was alluded to.

Mesa's initial document production was only 1209 pages for the Preliminary Injunction. After themotion 25,000+ pages were produced. IT department was not asked to help search for HAL-related documents.

IT department was not asked to help determine if HAL-related documents had been deleted.
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Day 2:

The evidentiary portion of this motion is complete. There will be closing arguments for the motion tomorrow, followed by the commencement of trial. The judge has stated that he will not rule on the motion until after the trial. When he does rule on this and other matters, keep in mind that the legal standard to find liability is NOT “beyond a reasonable doubt”. That is a criminal standard. Instead Judge Faris only has to find that “it is more likely than not” that Mesa did the things that HAL alleges. Given Mesa's lack of credibility, it is probable that issues that are 50 – 50 will go against Mesa. The real question is: what is the appropriate sanction?

On day 2 of the trial we discover that:

1. Mesa wanted to forestall Yucaipa from investing in Aloha by issuing a press release on 9/23/05, just prior to Yucaipa's announcement that they were investing in Aloha. In J.O. 's lexicon “Forestall” means “Cooperate and Invite”. J.O. lied under oath about this announcement in a deposition, calling the timing "coincidental".

2. Murnane is J.O.'s long-time pal, he's “honest” and “good quality people” but when push comes to shove, under the Mesa bus he goes, porn, hard-drives, laptops and all.

3. Mesa wanted to 'block sell seats' for Aloha as J.O. had done with Virgin/ Sabena in Europe, by creating 'Aloha express' and reducing Aloha's 737 capacity in Hawaii.

4. Although J.O. is the CEO of Mesa and was personally responsible for advising Mesa to start go! in Hawaii, he could not be bothered to read the “Hawaiian Information Memorandum” or other relevant materials from within and without his company.

5. That J.O. does not understand legal or computer jargon. (A.K.A. the Ken Lay defense “I'm just the CEO how should I know what is going on at my company?) This in spite of J.O.'s statement that "My grandfather was a lawyer".

6. Mesa's attorneys cannot control J.O.'s mouth: While J.O. probably took the stand thinking he was going to show HAL and Aloha how strong Mesa's case is, perhaps in an attempt to settle the case before trial with HAL, he was so thoroughly discredited by HAL and by his own testimony that, if anything, he has probably put a new bounce in HAL's legal step. In just one afternoon it was determined that J.O. has no regard for Judge Faris or his court, that he has condoned unethical behavior at his company, lied under oath, thrown his 30+ year friend under the bus with ridiculous allegations of porn viewing, and demonstrated to Judge Faris that Mesa will do just about anything to win.

7. That HAL can bite back -- they raised Sarbanes/Oxley issues regarding Mesa's CFO and his destruction of documents.

LONG SUMMARY

On day two Mesa finished Pappaianou's testimony and then presented three witnesses: Mesa's IT manager, McKay Monson, their V.P./ Chief Info Officer Jeffery Hornberg, and CEO Jonathan Ornstein. I'll abbreviate the first two witnesses, as J.O.'s testimony outshines anything that they testified to.

Pappaianou testified that he was able to see from 40+ feet away that Murnane was looking at porn, but stated that he took no action against Murnane at the time. [Some in the gallery suggested that we should do a CSI-like porn/ not-porn test from the same distance away in the courtroom. . .]

There was more testimony from Pappaianou and the other two that basically discredited Mesa's porn theory and made it quite obvious that the story was concocted recently. For example, the alleged porn that Pappaianou and Hornberg saw Murnane looking at happened in 2004. Since then the next time that Hornberg even thought of it was when he was asked to come and testify, last week. The evidence destruction happend n 2006.

Hornberg also testified that the porn issue was made aware to him due to a virus on Murnane's computer in 2004. When asked about it I think I heard him say that the cause of the virus was an “adult content website that we went . . .that was on there.” ** In other words, I think they know that Murnane was looking at porn because they were looking at it together. Just MHO though. **

It became apparent that one of Mesa's servers was on the fritz around February or March of 2006, while the other ones seemed to be alright. This server was the one on which the backups of Murnane's files were kept. ** As this was around the time of the filing of HAL's case against Mesa, this is particularly inconvenient for HAL, and suspicious for Mesa. **

continued...