Virgin aMerica: Neither?
Showing a business style like that of the world’s oldest profession, Virgin America promised San Francisco Mayor Gavin New some a friendly approach to labor. Today, it intimidates employees seeking collective bargaining. More broadly, Virgin America is back in the slime light as a company which may no longer qualify as a U.S. carrier under federal law.
Aviation Week’s Andrew Compart reports that Rep. James Oberstar, (D-MN) sent a letter to Transportation Secretary Ray LaHood in which he questioned Virgin America’s continuing compliance with federal requirements that U.S. carriers be owned and controlled by U.S. citizens. Oberstar holds clout as chairman of the U.S. House Committee on Transportation and Infrastructure. Citing media reports, Oberstar says Virgin may be “outside the legal limits for foreign ownership.”
Oberstar, a major proponent of keeping strict controls on how the DOT interprets U.S. ownership and control of U.S. carriers explains the legal tangle. Two U.S. equity funds, which owned a majority of Virgin America, sold back their stakes, according to the Wall Street Journal.
Virgin America, unsurprisingly to those in the labor movement, has a slick answer. It claims that although the U.S. equity funds it set up to circumnavigate U.S. law has ditched the “economic value” of their stock, they retain voting power and control of their stock until Virgin America finds U.S.-based replacements, according to the NY Daily.
How reassuring that is.
Oberstar is asking LaHood to order a comprehensive review of the accuracy of the news reports, and, if the reports are proven correct, to conduct a public proceeding to examine the question of Virgin America’s citizenship.