In the

United States Court of Appeals

For the Seventh Circuit

No. 11-1921

COMMITTEE OF CONCERNED

MIDWEST FLIGHT ATTENDANTS

FOR FAIR AND EQUITABLE

SENIORITY INTEGRATION, et al.,

Plaintiffs-Appellants,

v.

INTERNATIONAL BROTHERHOOD OF

TEAMSTERS AIRLINE DIVISION and

TEAMSTERS LOCAL 135,

Defendants-Appellees.

Appeal from the United States District Court

for the Eastern District of Wisconsin.

No. 10-C-379—Rudolph T. Randa, Judge.

ARGUED SEPTEMBER 30, 2011—DECIDED NOVEMBER 30, 2011

Before EASTERBROOK, Chief Judge, and POSNER and

WILLIAMS, Circuit Judges.

EASTERBROOK, Chief Judge. The McCaskill–Bond Amendment to the Federal Aviation Act, 49 U.S.C. §42112 note,
2 No. 11-1921

provides that a transaction “for the combination of

multiple air carriers into a single air carrier” requires

the combined business to merge the seniority lists of

the two carriers’ employees. Republic Airways Holding

acquired Midwest Airlines in July 2009 by purchasing

its parent, Midwest Air Group. The seniority lists for

mechanics, baggage handlers, and administrative personnel have been integrated under the Amendment. But

Republic furloughed the flight attendants, requiring

them to apply for “new” jobs; if they are rehired, the

Teamsters Union, which represents the flight attendants at Republic’s older carriers (Republic Airlines,

Chautauqua Airlines, and Shuttle America), places them

at the bottom of its seniority roster. (Pilots, too, were

furloughed, but their status is not at issue here.) The

Teamsters Union has refused to budge from this position, which it has maintained even after the National

Mediation Board concluded that the flight attendants

who worked for Midwest became part of a single bargaining unit at an integrated air transportation business

that comprised Republic, Chautauqua, Shuttle America,

and Midwest. In re Chautauqua Airlines / Shuttle America /

Republic Airlines / Midwest Airlines / Frontier Airlines / Lynx

Aviation, 37 N.M.B. 148 (2010). Three of Midwest’s

flight attendants, and a committee purporting to speak

for all of them, filed this suit.

When Republic Airways Holding acquired it, Midwest

was losing money and needed to surrender most of its

planes, which had been leased. Midwest had only nine

planes on the date of the merger. Within a few months,

Republic returned them to Boeing and abandoned the
No. 11-1921 3

certificate from federal regulators that entitled Midwest

to engage in the air transportation business. Republic

retained and used Midwest’s gates, takeoff and landing

slots, trademarks, code (YX), and other assets. Republic

(operating with Midwest’s name and marks) provided

service to most of the city pairs that Midwest had

flown; only the type of aircraft changed. (Midwest

used Boeing 717 planes; Republic uses Embraer

190s.) Frontier Airlines, another subsidiary of Republic

Airways Holding, has taken over the routes that

Republic Airlines operated in Midwest’s name from mid2009 through mid-2011, and Midwest’s trademarks have

been retired; no one contends that these developments

affect how seniority issues should have been handled

earlier. (Eventually we may need to consider questions

about what rights Midwest’s former employees have

in Frontier’s seniority system, which is separate from

Republic’s. See Teamsters Union, Airline Division v.

Frontier Airlines, Inc., 708 F. Supp. 2d 750 (E.D. Wis. 2010);

In re Chautauqua Airlines, 37 N.M.B. at 167.)

The district court held that Republic’s abandonment of

Midwest’s certificate, and the return of its planes, meant

that Republic had acquired some assets related to air

transportation but not an “air carrier” for the purpose

of the McCaskill–Bond Amendment. Although the court

initially denied the Teamsters’ motion for summary

judgment, 742 F. Supp. 2d 1035 (E.D. Wis. 2010), it granted

a motion for reconsideration and ruled in the Union’s

favor. 2011 U.S. Dist. LEXIS 2718 (E.D. Wis. Jan. 10, 2011).

The court stated that “McCaskill–Bond was never meant

to protect the employees of an air carrier that simply

goes out of business.” Id. at *9.
4 No. 11-1921

Legislatures do not mean things in the abstract; as

Justice Holmes once put it, the right question is what

they meant by what they said. “[A statute] does not

disclose one meaning conclusively according to the laws

of language. Thereupon we ask, not what this man

meant, but what those words would mean in the mouth

of a normal speaker of English, using them in the circumstances in which they were used . . . . But the normal

speaker of English is merely a special variety, a literary

form, so to speak, of our old friend the prudent man. He

is external to the particular writer, and a reference to

him as a criterion is simply another instance of the

externality of the law. . . . We do not inquire what the

legislature meant; we ask only what the statute means.”

Oliver Wendell Holmes, Jr., The Theory of Legal Interpretation, 12 Harv. L. Rev. 417, 417–19 (1899), reprinted in

his Collected Legal Papers 204, 207 (1920). What

the McCaskill–Bond Amendment means is not hard to

discern.

Here is all of the statutory text that matters:

(a) With respect to any covered transaction involving two or more covered air carriers that

results in the combination of crafts or classes that

are subject to the Railway Labor Act (45 U.S.C. 151

et seq.), sections 3 and 13 of the labor protective provisions imposed by the Civil Aeronautics

Board in the Allegheny-Mohawk merger (as published at 59 C.A.B. 45) shall apply to the integration of covered employees of the covered air

carriers; [two exceptions are omitted as irrelevant]

(b) In this section, the following definitions apply:
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(1) The term “air carrier” means an air carrier

that holds a certificate issued under chapter

411 of title 49, United States Code.

(2) The term “covered air carrier” means an air

carrier that is involved in a covered transaction. . . .

(4) The term “covered transaction” means—

(A) a transaction for the combination of

multiple air carriers into a single air carrier; and which

(B) involves the transfer of ownership or

control of—

(i) 50 percent or more of the equity

securities (as defined in section 101 of

title 11, United States Code) of an air

carrier; or

(ii) 50 percent or more (by value) of the

assets of the air carrier.

Subsection (a) provides the basic rule: merging the seniority lists, rather than putting employees of the acquired carrier at the bottom of the acquiring carrier’s

list, was a condition of the Allegheny–Mohawk merger

and therefore is required in every covered transaction

“involving” covered air carriers. An “air carrier” is any

firm that holds a certificate issued under 49 U.S.C. §411.

Midwest held such a certificate on the date the merger

closed and therefore was an “air carrier.” It also was

“involved in” a transaction. True, Midwest Airlines was
6 No. 11-1921

a subsidiary in a holding company structure. Republic

Airlines’ parent company acquired Midwest’s parent. Yet

subsidiaries are “involved in” such a transaction; the

McCaskill–Bond Amendment does not require that

the operating company be acquired, only that it be “involved.” (Otherwise the statute could be evaded with

ease, because it is easy to create a parent for any corporation.)

Thus the question becomes whether Midwest and

Republic engaged in a “covered transaction.” The conditions of subparagraph (B) are satisfied because

Republic acquired 100% of Midwest. (It is therefore

unnecessary to consider whether the gates and landing

slots were worth more than Midwest’s meager equity

in the leased planes.) And subparagraph (A) is satisfied

if Midwest became part of a “single air carrier” with

Republic. That it did. Operations and schedules were

integrated; Republic answered the phones, took reservations, and began to fly Midwest’s routes with planes

and employees that came from its other subsidiary carriers. That’s why the National Mediation Board concluded that all flight attendants are part of a single

pool, represented by a single union; that’s why the seniority lists of the reservations clerks and mechanics

already have been integrated. When Republic abandoned

Midwest’s certificate and returned the leased planes,

this meant even more complete consolidation. Only

Republic remained, as a “single air carrier.”

Nothing in the text of the statute asks whether one of

the merging carriers is bankrupt and about to vanish when
No. 11-1921 7

the transaction closes. There’s a good reason for the

omission: this statute grew out of American Airlines’

acquisition of Trans World Airlines, which was bankrupt

and would have closed its doors had it not been acquired. TWA had its main hub in St. Louis; the two

Senators whose names are on the legislation represented the State of Missouri. (The original sponsors

were Senators Bond and Talent; Sen. McCaskill replaced

Sen. Talent as a sponsor when she succeeded him.) What

seniority TWA’s former employees would retain was a

contentious issue that threatened to frustrate the transaction or precipitate a strike; the statute provides how

these transactions must be handled in the future. One

cannot remove bankrupt and soon-to-disappear carriers

from the statute’s coverage, as the Teamsters propose,

without simultaneously circumventing the statutory

text and frustrating the design behind it. “[W]hat those

words would mean in the mouth of a normal speaker

of English, using them in the circumstances in which

they were used” is that they govern all transactions

in which an acquisition is followed by joint operations,

whether or not one carrier was on the brink of collapse.

Republic acquired Midwest—what little of it remained—

lock, stock, and barrel, via a merger, which turns

two corporations into one, while the statute would

have been satisfied with the acquisition of only 50% of

Midwest’s assets.

The statutory requirement that the (formerly) separate

carriers operate as a single carrier matters when the

carriers maintain separate businesses. Although United

Airlines and Continental Airlines have merged (rather,
8 No. 11-1921

their holding companies have merged), they have continued to operate as separate businesses, integrating

their operations only slowly. Until the joint operations

have reached the point that they have become a “single

air carrier,” they need not merge their seniority

lists. Midwest, by contrast, integrated operations with

Republic, Chautauqua, and Shuttle America expeditiously; that’s why it was able to give up its certificate and planes, while transferring gates and landing

slots for use by the other jointly operated carriers.

Midwest and Republic engaged in a “covered transaction.” The later wasting away of Midwest illustrates

the completeness of the integration; it does not negate

the statute’s coverage.

The judgment is reversed, and the case is remanded

for proceedings consistent with this opinion.

11-30-11