In re Raejean S. Bonham dba World Plus
Bankruptcy No. F95-00897
Unofficial Web Site

The Trustee and Delta Air Lines presented a proposed settlement to the Bankruptcy Court on April 15, 1997. On the objections of about 100 creditors represented by two law firms, the court ordered the Trustee and Delta Air Lines to provide additional facts and briefing. This document is a summary of Delta's breifing. There is also a Declaration of Larry Compton and the Trustee's brief in support of the settlement. available at this site. If Delta furnishes text files of its pleadings to the trustee, Delta's pleadings will be posted in full.

Delta Settlement - A Summary of Delta's Position

Obviously, this is not Delta's version of its position. This is the Trustee's understanding of Delta's position. Here are the salient points:

1. Delta counted all of the reservation cards. Delta states it conscientiously worked to avoid duplicates, cancelled flights, and other types of cards that might not reflect actual Delta passenger miles.

2. Delta counted a total of 19,906 flights on its system between 1990 and 1995.

3. To measure damages, and or purposes of settlement, Delta located the lowest fare it charged at any time in the period 1990 to 1995 between Anchorage or Fairbanks and any destination in the lower 48. The lowest fare turned out to be between Anchorage and Seattle, $456.84. Obviously, this is far lower than the average fare for the tickets involved (who would pay $550 for a ticket they could buy from Delta for $456?), but it sets the minimum amount of damages due to Delta.

4. Using that 19,906 tickets and $456.84/ticket, Delta's minimum damages are in the range of $9,093,857.

5. Delta points out that "stowaway rule" has been the law of the United States for almost 100 years. The "stowaway rule" says that any person on a common carrier - like an airline - under false pretenses is "stowaway," and captured stowaways are and always have been required to pay full, walk up to the counter fare.

6. Under the "stowaway rule," Delta's damages are probably in th range of $18-20 million.

If Delta's minimum damages are in the neighborhood of $9 million, then the $2 million settlement agreement is a terrific deal for the creditors and the estate.

Again, this is just a sumary of Delta's position; for the actual pleadings please inspect the records at the U.S. Bankruptcy Court or at Guess & Rudd during regular business hours, or contact

Jeffrey W. Willis
Tony G. Powers
Rogers & Hardin
Attorneys for Delta Air Lines
2700 Peachtree Center, Cain Tower
229 Peachtree Street, N.E.
Atlanta, GA 30303

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