International Ass'n of Machinists & Aerospace Workers v. Allegis Corp.
The International Association of Machinists and Aerospace Workers (IAM), representing employees of Allegis Corporation and United Air Lines, Inc., initiated an action to set aside an alleged fraudulent conveyance. The Union claimed that United's assets were encumbered without consideration to finance a $2.8 billion cash distribution to Allegis shareholders, potentially rendering United insolvent. Defendants moved to dismiss the complaint on grounds of federal preemption by the Railway Labor Act (RLA), laches, mootness, and failure to join necessary parties. Presided over by Herman Cahn, J., the court denied all branches of the defendants' motion. The court found that the claims were not preempted by the RLA, were within the Statute of Limitations, were not moot, and that shareholders were not necessary parties to the action.