The above article in “The Motley Fool” by a reporter named Rich Duprey has provoked a substantial response from the pilot group. His article picks up on a theme which has been an item of some interest for the last month or so, and seems to be prompted by a recent letter from a group entitled the “Committee for the Restoration of Pensions at United Airlines 2007” to Senator Akaka from Hawaii. The UAL-MEC asked its lawyers and advisors at that time to review those materials and to report to it at its Special Meeting in September. That report did take place, and the MEC was fully briefed on the facts.

A number of critical facts are absent in Mr. Duprey’s article. First, and most significantly from a legal standpoint, the PBGC specifically waived its rights to take the action which Mr. Duprey asserts it can under Section 4047 of ERISA. That waiver was a key component of its agreement with United, which itself was a key part of United’s Plan of Reorganization as approved by the Bankruptcy Court. Were the PBGC to now act in the face of that waiver, the PBGC would have to prove that United committed fraud in the negotiations with the PBGC to induce it to give that waiver. If that were proven to be the case, the entire bankruptcy could unravel and all of United’s creditors would be seeking any monies which might be generated by the sale of Mileage Plus, not just employees.

The sale of Mileage Plus is a subject which has been considered by United from time to time over the years. Mileage Plus is not at this time and was not during the bankruptcy a separate legal entity, but simply part of the airline. During the bankruptcy, the inherent value of Mileage Plus was fully understood by the creditors, and in fact was part of the AFA pension rejection analysis. It is important to understand that any value of Mileage Plus depends totally upon how viable the airline is, and at the time the of the PBGC waiver, United’s was much less viable than today.

From the employees’ perspective, any Mileage Plus transaction is problematic and should be examined closely. Among the issues to be considered is to what use United intends to dedicate the proceeds. That issue is one the MEC will discuss next week during its regular meeting. The entire range of possible actions, legal and otherwise, will be closely examined by the MEC and we will have further information for you as a result of that examination.

The restoration of the pension plans in the manner suggested by Mr. Duprey is simply not currently legally possible. The result he suggests could only be achieved with the passage of a new law by Congress, and that is another avenue the MEC has and will continue to consider.