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FedEx wins reversal of jury's $66M award to ATA

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FedEx Corp. has won an appeal that overturns a $66 million verdict in favor of defunct Indianapolis airline ATA Airlines Inc.

The 7th Circuit Court of Appeals in Chicago heard the appeal in November and issued the reversal Tuesday morning in ATA Airlines Inc. v. Federal Express Corp., No.s 11-1271, 11-1492.

ATA initially won a jury verdict over the breach-of-contract case in October 2010. FedEx unsuccessfully appealed the decision to the U.S. District Court, Southern District of Indiana before taking it to the higher court.

ATA charged in its initial lawsuit that FedEx’s unexpected decision in January 2008 to drop it as a military-charter partner forced it into bankruptcy liquidation that spring. ATA had been flying military charters for more than two decades, and it said FedEx was legally obligated to keep it on board through at least September 2009.

The appeals court said ATA’s legal experts failed to prove the amount of damages suffered because of the breach of contract. The court said ATA may well have suffered some losses due to FedEx’s actions, but because there was “no reasonable confidence in the jury’s damages award,” the case should be reversed.

The case hinged on a September 2006 letter that described how business was to be divvied up through September 2009 between ATA and another airline that was part of the FedEx military-charter team.

FedEx argued that was not a legal contract because it didn’t address financial terms and other key issues. It noted the legal standard for an enforceable contract is “a meeting of the minds of the parties, in mutual assent to all essential terms.”

In a court filing, FedEx attorneys wrote, “Given the uncontroverted evidence and the relevant law … there is simply no reasonable basis in the record on which the jury could find that an agreement on just one term of FedEx Team membership was an enforceable contract for FedEx Team membership.”

FedEx balked at the size of the jury's award, noting that in fiscal 2007, ATA earned just $2.1 million from its military charter business.

The $66 million judgment was supposed to go to ATA's creditors, who are still owed millions in the company's Chapter 7 bankruptcy. The 7th Circuit dismissed the suit with prejudice.

This story originally ran on IBJ.com Dec. 27, 2011.

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  1. How nice, on the day of my car accident on the way to work at the Indiana Supreme Court. Unlike the others, I did not steal any money or do ANYTHING unethical whatsoever. I am suing the Indiana Supreme Court and appealed the failure of the district court in SDIN to protect me. I am suing the federal judge because she failed to protect me and her abandonment of jurisdiction leaves her open to lawsuits because she stripped herself of immunity. I am a candidate for Indiana Supreme Court justice, and they imposed just enough sanction so that I am made ineligible. I am asking the 7th Circuit to remove all of them and appoint me as the new Chief Justice of Indiana. That's what they get for dishonoring my sacrifice and and violating the ADA in about 50 different ways.

  2. Can anyone please help this mother and child? We can all discuss the mother's rights, child's rights when this court only considered the father's rights. It is actually scarey to think a man like this even being a father period with custody of this child. I don't believe any of his other children would have anything good to say about him being their father! How many people are afraid to say anything or try to help because they are afraid of Carl. He's a bully and that his how he gets his way. Please someone help this mother and child. There has to be someone that has the heart and the means to help this family.

  3. I enrolled America's 1st tax-free Health Savings Account (HSA) so you can trust me. I bet 1/3 of my clients were lawyers because they love tax-free deposits, growth and withdrawals or total tax freedom. Most of the time (always) these clients are uninformed about insurance law. Employer-based health insurance is simple if you read the policy. It says, Employers (lawyers) and employees who are working 30-hours-per-week are ELIGIBLE for insurance. Then I show the lawyer the TERMINATION clause which states: When you are no longer ELIGIBLE! Then I ask a closing question (sales term) to the lawyer which is, "If you have a stroke or cancer and become too sick to work can you keep your health insurance?" If the lawyer had dependent children they needed a "Dependent Conversion Privilege" in case their child got sick or hurt which the lawyers never had. Lawyers are pretty easy sales. Save premium, eliminate taxes and build wealth!

  4. Ok, so cheap laughs made about the Christian Right. hardiharhar ... All kidding aside, it is Mohammad's followers who you should be seeking divine protection from. Allahu Akbar But progressives are in denial about that, even as Europe crumbles.

  5. Father's rights? What about a mothers rights? A child's rights? Taking a child from the custody of the mother for political reasons! A miscarriage of justice! What about the welfare of the child? Has anyone considered parent alienation, the father can't erase the mother from the child's life. This child loves the mother and the home in Wisconsin, friends, school and family. It is apparent the father hates his ex-wife more than he loves his child! I hope there will be a Guardian Ad Litem, who will spend time with and get to know the child, BEFORE being brainwashed by the father. This is not just a child! A little person with rights and real needs, a stable home and a parent that cares enough to let this child at least finish the school year, where she is happy and comfortable! Where is the justice?

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