"Thrown Out" was a vague term but would there be no legal recourse to require it to be changed.

Republic was in breach of contract with Delta, and Republic cited lack of pilot as a reason for not being able to fulfill the contract. Therefore the TA will be changed because it adversely affected Republic's ability to complete the contract.

I'm not a lawyer, just being a devils advocate.

No joke. Thanks for spelling it out for the kiddo.

Republic AC
 

My understanding is it would be easy for Delta to acquire the Republic planes. If they have cause to terminate the contract early, i.e. not meeting performance metric or just a settlement in a lawsuit, Delta can require that Republic sell the airplanes or transfer the lease to Delta. At least the E175's, it appears that the E170's do not fall under that provision.

Even if Delta can't force Republic to sell or transfer the planes, Republic won't be able to survive long if Delta or another mainline partner decides to withhold payments or cancel their contract. Those planes at Republic and other contracted lift require their mainline partner to pay them money so they can make the monthly payments.

Without those payments a contractor would be forced to hand them over or go through bankruptcy, which would lead to them being forced to hand them over if they don't agree to the terms of their creditors and mainline partners.

This is the risk you take when you don't sell your own tickets.

From the Delta annual report:

Contingencies Related to Termination of Contract Carrier Agreements
We have two agreements with Shuttle America that relate to its operation of Embraer 145 and Embraer 170/175 aircraft under capacity purchase agreements. The Embraer 145 aircraft were operated by Chautauqua Airlines at December 31, 2014 and assigned with our consent to Shuttle America in January 2015. By providing required advance notice, we may terminate the Embraer 145 agreement without cause at any time. Similarly, we may terminate the Embraer 170/175 agreement without cause at any time after January 2016 . If we terminate either of the agreements without cause, Shuttle America has the right to (1) assign to us certain leased aircraft that the airline operates for us, provided we are able to continue the leases on the same terms the airline had prior to the assignment and (2) require us to purchase or lease certain of the aircraft the airline owns and operates for us at the time of the termination. If we are required to purchase aircraft owned by Shuttle America, the purchase price would be equal to the amount necessary to (1) reimburse Shuttle America for the equity it provided to purchase the aircraft and (2) repay in full any debt outstanding at such time that is not being assumed in connection with such purchase. If we are required to lease aircraft owned by Shuttle America, the lease would have (1) a rate equal to the aircraft-related debt payments of Shuttle America as if 90% of the aircraft was financed by Shuttle America and (2) other specified terms and conditions . Because these contingencies depend on our termination of the agreements without cause prior to their expiration dates, no obligation exists unless such termination occurs.
We estimate that the total fair values, determined as of December 31, 2014 , of the aircraft Shuttle America could assign to us or require that we purchase if we terminate without cause our contract carrier agreement are approximately $111 million with respect to the Embraer 145 aircraft and $290 million with respect to the Embraer 170/175 aircraft. The actual amount we may be required to pay in these circumstances may be materially different from these estimates. If Shuttle America exercises this right, we must also pay Shuttle America 10% interest (compounded monthly) on the equity it provided when it purchased the aircraft. These equity amounts for the Embraer 145 and the Embraer 170/175 aircraft total $25 million and $52 million , respectively.

That's a good report to cite Bluemoon. So basically, Delta can takeover those planes if it chooses. The big kicker there is it can already do so without cause. So basically, Delta is in control either way.

Now, what is going on, is Delta is saying they have cause to cancel the contract with Republic outright, since they can't fulfill their end of the contract. That allows Delta to get out of their obligations with payments owed on the leases per that agreement and would force Republic to negotiate on different terms.

Basically Republic is looking like Mesa of 2009, in 2015.

Probably no news until early next year so keep circling overhead.

Oh, he will. All while working for a subpar contract at subpar wages.

Not true. 1). They can't lease them out and have someone else fly them, violates our cba.

2). The exploratory portion of the suit isn't scheduled to be concluded until this spring, this is going no where fast.




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My guess is Delta wants control over those planes since, given the lawsuit, they are not happy with Republic's performance. They have no intention of removing the planes from their route structure, Delta just doesn't want Republic operating them anymore.

Pure Speculation: I'm guessing Delta wants at least some of the planes and will get them one way or the other.