Why, you might be wondering, would United grant Smisek a pile of cash and a long list of luxurious perks after he’s helped generate such bad publicity for the company?
What began as a mysterious series of traffic jams at the George Washington Bridge two years ago has mushroomed into a high-level corporate scandal that can’t be good for Republican Gov. Chris Christie’s struggling presidential campaign.
Most of the suspicion centers on United’s relationship with former Port Authority Chairman David Samson.
The general sense is that maybe a new team in place might turn around United Continental and its United Airlines.
The Port Authority is tremendously influential in New Jersey and New York politics and everyday life. He added that “all of our disclosures were appropriate” and said that the federal investigation was ongoing, as well as United’s own internal investigation.
If charges are brought against Samson, Smisek or others, they would be likely to fall under a federal statute governing theft of honest services, a broad law used frequently in corruption cases, said Bradley Simon, a white-collar defense attorney and former federal prosecutor. United declined on comment on what the federal investigators had found during a conference call with analysts which led them to take the step. First was a new maintenance hangar for its jets.
Smisek will receive separation pay of about $4.9 million, payable in a lump sum. United also sought lower fees for the rental of gates and terminal space.
According to a report in Bloomberg, Samson surprised the United CEO with a request to restart to an unprofitable Newark to Columbia route during a 2011 dinner meeting.
Samson resigned from his post previous year after a scandal involving a lane closure on the Fort Lee Bridge.
United Airlines has a hub at Newark Liberty global Airport, and wanted to renegotiate the lease agreements at the airport during Mr. Samson’s reign as the chairman of Port Authorities. He was paid $12.7 million in 2014.
Q: Was there anything else? About that time United was pressing for concessions from the agency, including a new hangar at the Newark airport. Bourne said he had a “rocky start” with Smisek when he initially proposed outsourcing ground service operations at several airports including Newark. Mr Samson resigned from the Port Authority in March 2014 amid rumors he was linked to Bridgegate.
Q: What did the Port Authority need from United?
Samson had a weekend home near the Columbia airport. United resumed the flights, leaving Newark on Thursday nights and returning on Monday mornings.
But this week, the short-lived “chairman’s flight” backfired. A few other airlines offer flights with a stop in Charlotte and a three-hour-plus flying time. And things were even bleaker in February when the flight averaged just 16 passengers.
The Port Authority said the complaint, which is pending before the FAA, has no merit.
The Association of Flight Attendants-CWA issued a statement welcoming Munoz and “new leadership and a new direction that recognizes the value of frontline workers and the full potential of our airline”.
Smisek also agreed to cooperate fully with United “in the defense, prosecution or conduct of any claims or investigations which relate to events or occurrences that transpired” while Smisek was employed. Pizzarello said he has platinum-level elite status on United but won’t change a flight from American or Delta “to a carrier I’m having trouble trusting”.