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Federal judge approves US Airways emergence from Chapter 11

[JURIST] A federal judge on Friday gave US Airways [corporate website] the green light to emerge from Chapter 11 bankruptcy [SEC backgrounder], a little more than a year after the beleaguered airline sought protection. The approval clears the way for the airline to complete its merger [JURIST report] with America West [corporate website] by late this month or early October. The bankruptcy was US Airways' second since August 2002, as the country's seventh-largest airline has struggled to overcome rising fuel costs and the success of low-cost competitors like Southwest. Bankruptcy Judge Stephen Mitchell gave clearance for the airline after approving the last major hang-up over $12 million in severance pay for former executives with the airline. US Airways must wait a week before formally emerging from bankruptcy, but even as it does, three other of the nation's largest air carriers remain under bankruptcy protection [JURIST report]. US Airways has a news release on the approval. AP has more.

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Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible format.

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