IBJNews

Federal judge backs jury award in FedEx-ATA dispute

Back to TopCommentsE-mailPrintBookmark and Share

FedEx Corp. will have to take its appeal of a $66 million verdict in favor of the defunct Indianapolis airline ATA to a higher court.

Richard Young, chief judge in the U.S. District Court of southern Indiana, said in a Wednesday ruling that he will not overturn the jury's October decision. He denied FedEx's motion for a new trial, writing that "the jury's damages award was rationally based upon the evidence and was not monstrously excessive."

As IBJ reported in its Jan. 17 edition, the jury's verdict seemed to come as a shock to FedEx attorneys, who said it went against the "clear weight of the evidence." The company said in a recent securities filing that it had set aside a $66 million reserve to cover the damages award, but that it would appeal the decision.

Now that FedEx has exhausted its options at the lower court, the next stop is the Seventh Circuit Court of Appeals in Chicago.  

ATA charged in the breach-of-contract suit 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 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.

If the $66 million judgment stands, it will go to ATA's creditors, who are still owed millions in the company's Chapter 7 bankruptcy.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. I am so impressed that the smoking ban FAILED in Kokomo! I might just move to your Awesome city!

  2. way to much breweries being built in indianapolis. its going to be saturated market, if not already. when is enough, enough??

  3. This house is a reminder of Hamilton County history. Its position near the interstate is significant to remember what Hamilton County was before the SUPERBROKERs, Navients, commercial parks, sprawling vinyl villages, and acres of concrete retail showed up. What's truly Wasteful is not reusing a structure that could still be useful. History isn't confined to parks and books.

  4. To compare Connor Prairie or the Zoo to a random old house is a big ridiculous. If it were any where near the level of significance there wouldn't be a major funding gap. Put a big billboard on I-69 funded by the tourism board for people to come visit this old house, and I doubt there would be any takers, since other than age there is no significance whatsoever. Clearly the tax payers of Fishers don't have a significant interest in this project, so PLEASE DON'T USE OUR VALUABLE MONEY. Government money is finite and needs to be utilized for the most efficient and productive purposes. This is far from that.

  5. I only tried it 2x and didn't think much of it both times. With the new apts plus a couple other of new developments on Guilford, I am surprised it didn't get more business. Plus you have a couple of subdivisions across the street from it. I hope Upland can keep it going. Good beer and food plus a neat environment and outdoor seating.

ADVERTISEMENT