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In re AMR Corp.

United States District Court, S.D. New York

March 9, 2017

In the Matter of AMR Corporation
v.
AMR CORPORATION, et al., Appellee. STEPHEN C. DAVIDSON Appellant,

          MEMORANDUM OPINION & ORDER

          VALERIE CAPRONI United States District Judge

         Appellant Stephen Davidson (“Davidson”), proceeding pro se, appeals from three orders of the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”): (1) denying Davidson's proof of claim in Appellee AMR Corporation's (“AMR”) Chapter 11 case; and (2) denying two motions for reconsideration under Section 502(j) of the Bankruptcy Code. Davidson's appeal of the Bankruptcy Court's orders denying his proof of claim and first motion for reconsideration is DISMISSED; Davidson's appeal of the Bankruptcy Court's order denying his second motion for reconsideration is DENIED, and that Bankruptcy Court order is AFFIRMED.

         BACKGROUND

         Davidson, a former American Airlines (“AA”) pilot, is attempting to take a fourth bite at the apple on various claims against his former employer. Davidson unsuccessfully sought relief in Florida state court for purported civil rights violations and tort claims. Then Davidson commenced unsuccessful grievance procedures with AA. After those losses, Davidson filed a proof of claim for over $16 million in AMR's bankruptcy proceeding. The Bankruptcy Court denied not only that proof of claim but two motions to reconsider. This appeal followed.

         A. The Florida State Court Action[1]

         In 2002, Davidson, represented by counsel, sued AA in Florida State Court in Davidson v. American Airlines, Inc., No. 02-01208-CA-20. CD 23 (“Debtors' Supplement”), Ex. C (“Complaint”). That complaint was subsequently amended to assert four causes of action-race discrimination and retaliation under the Florida Civil Rights Act of 1992, Fla. Stat. 760.01 (“FCRA”), negligent hiring and supervision, and vicarious liability for alleged physical assaults by a training instructor. Debtors' Supplement, Ex. D (“Amended Complaint”). The alleged physical assaults included: (1) a kick during a captain simulator training (“the kicking incident”); and (2) a pat on the shoulder (“shoulder pat incident”). Id. ¶¶ 46, 56; CD 29 (“Order”), at 2-3 & n.1-5. He also alleged generally other acts of verbal harassment and physical intimidation by AA flight instructors. Amended Complaint ¶¶ 47, 57.

         AA moved for summary judgment, which the Florida State Court granted on three of the four claims. Order at 3. The case proceeded to trial, and the jury found in favor of AA on the remaining retaliation claim. Id. at 3-4. Davidson appealed to the Third District Court of Appeal for the State of Florida, which affirmed the lower court's decision in Davidson v. Am. Airlines, Inc., Nos. 3d07-2063, 3D07-1901, 2D08-234 (Fla. 3d Dist. Ct. App. Apr. 29, 2009).[2] Id. at 4.

         B. The Grievance Procedures

         Following his loss in state court, Davidson filed a grievance pursuant to a collective bargaining agreement between AA and the Allied Pilots Association (“APA”), the union representing AA pilots. Debtors' Supplement, Ex. K. In the grievance, Davidson sought retroactive long-term disability benefits covering the period from July 8, 1999, through June 15, 2007, for an injury that allegedly stemmed from the kicking incident years earlier. Debtors' Supplement ¶ 12; id. Ex. A (“Proof of Claim”), [3] Grievance Appeal Hearing Tr. 9:4-11. A hearing was held before an AA managing director, and Davidson's grievance was denied. Debtors' Supplement, Ex. J. The union submitted the grievance to the Pre-Arbitration Conference for further consideration. Debtors' Supplement, Ex. K.

         While Davidson's grievance was pending further consideration, the Bankruptcy Court approved a new collective bargaining agreement and settlement letter between APA and AA. Bankr. Dkt. 5800 (“Settlement Letter Order”).[4] The settlement letter stated, in part:

In full and complete satisfaction of any and all claims APA has or might arguably have, on behalf of itself or the pilots represented by APA . . . the APA Settlement Consideration fully, finally, and completely extinguishes any and all claims, interests, causes or demands (including any and all pending grievances, excluding those grievances identified in Exhibit 1) that APA has or might arguably have, on behalf of itself or the pilots represented by APA . . . against the Debtors arising prior to the Effective Date of this Letter of Agreement as defined below.

Debtors' Supplement, Ex. L (“Settlement Letter”) § 1 (emphasis added). Davidson's grievance was not included in Exhibit 1 of the Settlement Letter. Settlement Letter at 7. Accordingly, per the terms of the Settlement Letter, the APA and AA agreed to extinguish Davidson's pending grievance as part of the negotiated global settlement agreement.

         C. The Bankruptcy Court Proceedings

         On November 29, 2011, AMR and its related debtor entities, including AA, filed a Chapter 11 bankruptcy petition. Bankr. Dkt. 1. On July 12, 2012, Davidson filed a proof of claim for more than $16 million. Proof of Claim at 5. The proof of claim included a two page letter accompanied by 190 pages of documents. See id.[5]

         The Appellees filed omnibus objections seeking to expunge Davidson's proof of claim. Bankr. Dkt. 12048; Order at 5. The Bankruptcy Court held a hearing during which Davidson explained that the kicking and shoulder pat incidents, along with another incident involving a firm handshake that occurred between the kicking and shoulder pat incidents (“handshake incident”), formed the basis for his proof of claim. Bankr. Dkt. 12371 (“Hearing Tr.”) at 36:18-42:4.[6]

         On January 28, 2015, the Bankruptcy Court expunged Davidson's proof of claim, finding that it was barred by res judicata on account of his prior Florida state court action. Order at 6-11. The Bankruptcy Court also denied Davidson's proof of claim to the extent that any portion of it stemmed from the grievance he filed with AA, given that Davidson's representative, the APA, had settled that matter as part of a Court-approved global settlement agreement with AA. Id. at 9 n.16.

         Davidson made a motion to reconsider the denial of his proof of claim, which was received by the Bankruptcy Court on February 13, 2015. CD 31. On July 10, 2015, the Bankruptcy Court denied the motion. CD 33. Over three months later, Davidson filed a second motion to reconsider. CD 35. On February 18, 2016, the Bankruptcy Court denied ...


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