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Documenting another Elizabeth Warren fib — Fairchild Aircraft case

Documenting another Elizabeth Warren fib — Fairchild Aircraft case

Warren tried to prevent four families who lost loved ones from getting their day in court

I know, I know, Elizabeth Warren supporters don’t care about the truth.  But the truth still matters, and will be preserved at The Elizabeth Warren File regardless of the election result.

So one last new bit of truth before the election.

In her incomplete list of cases she released to The Boston Globe shortly before one of the debates, Warren described her involvement in the Fairchild Aircraft case as follows (emphasis mine):

• In re Fairchild Aircraft Corp., 184 B.R. 910 (Bankr. W.D. Tex. 1995), vacated 220 B.R. 909 (Bankr. W.D. Tex. 1998). This was a tragic case, involving a plane crash that killed four people. The NTSB and a jury found that the aircraft manufacturer was not at fault. Elizabeth got involved to try to protect hundreds of jobs at the company after new investors had saved it from closing its doors and laying off its workers. In the end, the company survived and 1,000 people had jobs because of it. The bankruptcy court initially ruled against Elizabeth’s position but later vacated that decision.

This is a highly misleading description.  There is nothing to suggest that Warren was trying to rescue hundreds of jobs, and contrary to the suggestion in the last sentence, Warren’s legal position was not in any way vindicated by the purely procedural vacatur of a prior court decision.

The underlying case is here (184 B.R. 910, Bankr. W.D. Texas 1995).  Unfortunately, there is no public link I could find to the subsequent case vacating the first decision, but for those with access to Westlaw or other legal databases, the cite is 220 B.R. 909 (Bankr. W.D. Texas 1998).  (There is a brief discussion of the second case in this law review article.) Read them, and you will see that my description below is accurate, and Warren’s at best misleading.

The actual cases, which The Boston Globe and other media never bothered to read or understand, reveal that Warren tried unsuccessfully to deprive four families of loved ones killed in a plane crash of getting their day in court.

Fairchild Aircraft Corp. (FAC) filed for bankruptcy in 1990 in the Western District of Texas.  As part of the bankruptcy, a group of investors formed Fairchild Aircraft Inc. (FAI) to purchase the assets of FAC rather than reorganizing FAC.  The asset purchase was supposed to be free and clear of liabilities.

In 1993, after the banktuptcy was over, one of the planes manufactured by FAC prior to the bankruptcy crashed, and four families commenced suit against FAI and numerous other corporate defendants, which ended up consolidated in federal court in Tennessee.

In 1994, when she still was at U. Penn. Law School, Elizabeth Warren got involved and tried to convince the Texas bankruptcy court to issue an injunction preventing the families from continuing their suit in Tennessee on the ground the the bankruptcy asset purchase extinguished future claims against FAI.

Had she been successful, Elizabeth Warren would have deprived these families of any means of receiving compensation for the death of their loved ones even though the claims were unknown at the time of the bankruptcy because the plane crash had not yet taken place.

There is nothing in the decision to indicate these families’ claims would have caused FAI to go out of business, or the loss of hundreds of jobs, as Warren claims in her description to The Globe.  There were numerous other corporate defendants in those cases.

In 1995, the issue of extinguishing future claims was considered by bankruptcy court and it rejected Warren’s position, finding that the purchase of assets free and clear did not extend to future liabilities for events that had not yet taken place.  The court allowed the families’ cases to proceed to trial in Tennessee.

Warren’s client took an appeal from the bankruptcy court in Texas to the District Court in Texas.  That appeal sat unresolved.

The families got their day in court in Tennesse, but lost at trial.  The families then appealed to the federal appeals court, and the case was settled before the appeal was decided.

FAI wanted to wipe the prior Texas banktruptcy court decision off the books, presumably because the ruling that it could be liable for accidents on planes it purchased in the bankruptcy left it exposed to more potential claims should there be another crash.  It’s not clear if Warren was involved at this stage; her name was listed as one of the counsel, but it also listed her as being at U. Penn Law School, but by this time she was at Harvard.  The court may simply have carried over the prior list of counsel.

In 1998, FAI then went back to the Texas bankruptcy court and asked it to vacate its prior decision on the basis that the case had been settled, not on the merits of the prior decision.  That was unusual, since normally after a case is settled the case simply is dismissed, prior rulings are not “vacated.”  But again, FAI had a strategic reason to want the prior decision vacated.

After struggling with the issue, which presented numerous procedural issues, the Texas Bankrutpcy Court agreed to vacate the prior ruling because the settlement rendered the entire case moot.

Bottom line:  Elizabeth Warren worked to deprive four families whose loved ones were killed in a plane crash of getting their day in court based on a legal theory rejected by the bankruptcy court for deaths which resulted from a plane crash after the bankruptcy was over.  Had Warren prevailed, not only these families but other families whose loved ones were killed in future plane crashes would have been deprived of a chance for justice.  That decision later was vacated on purely procedural grounds after a settlement, not because Warren’s position was vindicated.  There is nothing to suggest that Warren was working to protect hundreds of jobs, as she claimed to The Globe.

Once again, Elizabeth Warren served the interests of her corporate client against the interests of the little guys and gals she now claims to champion.  There’s nothing wrong with that.  It’s a question of being honest with the public.

Related — For those of you interested in other cases Warren handled in which she incorrectly portrayed herself as fighting for the little guys and gals, see:

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Comments

franciscodanconia | November 3, 2012 at 12:30 pm

Thanks for the hard work, Professor. It’s been a real slog by you and others (primarily yourself) to shed light on Warren’s past and here claims of native ancestry.

“There is nothing in the decision to indicate the these famililes claims would have caused FAI to go out of business, or the loss of hundreds of jobs, as Warren claims in her description to The Globe. There were numerous other corporate defendants in those cases.”

Of course, they always obfuscate in order to spin such a tale into a positive for them. She’s a corporate lawyer, through and through.

1. For those of you interested in other cases Warren handled in which she incorrectly portrayed herself as fighting for the little guys and gals, see:

And these are cases she chose to reveal.

I gather that her list is incomplete. One wonders about the cases she did not divulge.

2. Warren is helping the little guy about as much as Al Sharpton is advancing civil rights.

    Jack The Ripper in reply to gs. | November 3, 2012 at 3:10 pm

    I don’t think you are being fair to the Good Reverend when you write:

    “Warren is helping the little guy about as much as Al Sharpton is advancing civil rights.”

    Rev. Sharpton is, at least by all appearances, black.

    Chief Teaching Bull pretends to be a champion of the little guy and a foe of Corporate America and Wall Street, but:

    1) Makes $350,000 a year teaching only one course yet decries the cost of education and proposes more student loans (which are very difficult to discharge in bankruptcy) as a way of fattening herself and her colleagues at the expense of the students;
    2) Takes legal positions that benefit those she reviles and harms those she claims to care about;
    3) Lives like an elitist;
    4) Appropriates opportunities that are supposed to be (at least in theory) for the disadvantaged;
    5) Appropriates opportunities that are supposed to be (at least in theory) to correct past injustices (which her ancestors happen to have literally participated in);
    6) Appropriates opportunities that are supposed to be (at least in theory) to foster diversity, and yet she is much more representative, say, of Aryan stock than she is of American Indian;
    7) Appropriates opportunities that are supposed to be (at least in theory) for past bigotry, like the kind practiced by her family towards the American Indians, including the one who married into the family;
    8) Decries Wall Street and Corporate America and Big Oil but has investments via TIAA-CREF in all three. Her TIAA-CREF funds include other TIAA-CREF funds that are Large Cap, Financial, Energy, Transportion, and Utilities.
    9) Claims to be for unions but was involved in coal dust litigation that would not have made her union paymasters happy.

    The list goes on and on. Al Sharpton is, at a minimum, negligent. Elizabeth Warren is, at a minimum, dishonest, elitist, hypocritical, mercenary, profiteering, rapacious, voracious, shameless, status-chasing, symbolism-exploiting (breast feeding during a Bar Exam), posturing, plagiarizing (recipes), negligent (research methodologies per the late Schuchman), opportunity appropriating, and fraudulent.

    Elizabeth Warren is a veritable catalogue of elitist liberalism, its fictions, conceits, lack of meritocracy, group think, class warfare, influence-peddling, correct-mindedness, and empty symbolism. The is guilty of nothing short of lying, cheating, stealing and bearing false witness.

    Regardless of his failures, you have to hand it to Al Sharpton, he is black. She is nothing that she claims to be or that she falsely claims to care about and fight for.

    george in reply to gs. | November 3, 2012 at 3:15 pm

    Brilliant!

    Warren is helping the little guy about as much as Al Sharpton is advancing civil rights.

Warren actually took a position that is without any support I know of under bankruptcy law (though I have not read her writing).

A bankruptcy is…in global terms…a snap-shot of the finances of a applicant at a moment in time. It cannot consider future potential liabilities, for obvious reasons.

Besides which, that is the role of insurance and risk management…including pricing…as a business moves forward.

Most Federal (and state) courts frown on pleading a position unsupported in the law unless you can make a very good argument the law should be changed.

It feels like the 2010 special election, here in Massachusetts. The Democrats are winning the polls, while the voters are impatiently waiting for Tuesday.

No political talk at the water coolers, the gathering places or church functions. Same as 2010.

Dead silence, speaks volumes.

I don’t know if the Republicans get it. But Obama,Jarrett, Reid, Pelosi and Hollywood, totally don’t get it.

    george in reply to Ma Kettle. | November 3, 2012 at 3:18 pm

    Just got a robo call from MATT DAMON

    He told me “Elizabeth” is fighting for the little guy.

    Matt, you make me puke!

posted it here too
http://www.theconservativevoices.com/news/cat/fauxahontas/documenting-another-elizabeth-warren-fib-fairch-r63

stated it was copy and pointed to here too, trying to raise awareness of her as much as I can.
thank you for all your work Prof.
and if this is ever an issue let me know and I will delete the articles. think I have done ok at letting whomever reads it that you are the source and I am just posting it.

Did you catch the post over at the weekly standard. They have a clip of Fauxahantas doing an interview in her home where she indicates she has many pictures of her indian heritage. The interviewer than asks to see the pictures. Lieawatha then says no she can’t see them.

Hilarious

http://www.weeklystandard.com/blogs/warren-claims-plenty-pictures-reflecting-native-american-heritage_660235.html

What is it with these so-called progressives, who do the very thing they say they are against? I’m thinking there’s a special place in Hades for people like her.

    Henry Hawkins in reply to Helen. | November 3, 2012 at 5:19 pm

    To be a leftist progressive in a center-right country requires you acquire skills in hiding the truth of your beliefs, principles, and agenda as you work your way up the power ladder. Some are not as good at it as others and the hypocrisy is revealed.

Professor, bankruptcy cases are generally available through PACER. I’ve found that quite often a direct link to the document will work without all viewers logging in and paying for it individually. In fact, while searching the web for public links to cases, many times I’ve found PACER materials in the search results and available for viewing without logging in. Just an idea…

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