Retired Delta pilots make plea

Delta Air Lines Inc.'s retired pilots asked a federal judge to order the third-largest U.S. carrier to make its October pension contribution to ensure the plan's survival.

Delta, which filed for bankruptcy on Sept. 14, sent letters to 4,500 pensioners saying it won't make the payment. The decision might prompt the Pension Benefit Guaranty Corp. to terminate the airline's retirement plans, the Delta Pilots' Pension Preservation Organization said.

"The loss of pensions and retirement benefits can have a devastating impact on retirees and their families," Dean Booth, a lawyer representing the group, said in papers filed with the U.S. Bankruptcy Court in New York. "Delta has increased the risk of an involuntary termination by promising to skip the October minimum funding contribution."

The Atlanta-based airline, which operates a hub at Salt Lake City International Airport, needs court permission to make the payments and, citing financial pressures, hasn't made such a request. U.S. Bankruptcy Judge Prudence Carter Beatty said this month she would address the issue at an October hearing.

Delta spokesman Anthony Black said the company will respond through court filings. Delta has the right to object to the pilots' request.

Delta Chief Executive Officer Gerald Grinstein said in a Sept. 15 letter that the airline won't make pension contributions because of the "need to preserve as much cash as possible."

Companies with ongoing pension plans "have a legal obligation to meet their funding requirements," PBGC, a federal corporation that guarantees payment of basic pension benefits for about 44 million American workers and retirees, said on its Web site.

UAL Corp.'s United Airlines, which filed for bankruptcy in 2002, began skipping contributions to its pension plans in July 2004. The Chicago-based airline said later that year it would seek to terminate the pensions and shift the plans to PBGC.

The move saved UAL $645 million annually and cost employees $3.2 billion in lost benefits. The company has offered to contribute to new retirement plans for workers.

Delta's 10 percent notes maturing in 2008 were little changed at 18 cents on the dollar on Trace, the bond-price reporting system of NASD. Delta shares fell 2 cents to 83 cents in New York Stock Exchange composite trading Monday.

Contributing: Andrew Dunn; Lynne Marek

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