Judge denies $20M severance deal for AMR CEO
By DAVID KOENIG | AP Airlines Writer April 12, 2013 7:52AM
American Airlines CEO Tom Horton talks to a reporter in New York. A federal bankruptcy judge has denied a proposed $20 million severance payment for CEO Horton as part of the company's merger with US Airways. | AP Photo
Updated: April 12, 2013 11:06AM
DALLAS — A federal bankruptcy judge has denied a proposed $20 million severance payment for the CEO of American Airlines as part of the company’s merger with US Airways.
The judge ruled Thursday the proposed payment to CEO Tom Horton exceeded limits that Congress set for bankruptcy cases in 2005.
The U.S. trustee’s office, part of the Department of Justice, had objected to Horton’s compensation. Judge Sean Lane declined to approve the payment during a hearing on March 28, but he didn’t issue a ruling until Thursday.
At that hearing last month, however, Lane approved the plan for American Airlines parent AMR Corp. to merge with US Airways Group Inc. in a deal that would create the world’s largest airline. The merger is being reviewed by U.S. antitrust regulators.
