The Bulletin

FAA, American Airlines settle safety dispute for $24.9 million

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After the FAA claimed that American Airlines violated safety regulations, the carrier has agreed to pay $24.9 million to settle the dispute.

The Federal Aviation Administration believed that American Airlines did not follow safety protocols for electrical wiring in planes, which caused the 2008 grounding of McDonnell Douglas MD-80 aircraft and cancelled thousands of flights. In addition, American allegedly sent Boeing 757 jets up in the air before full inspections and repairs were completed, and the FAA claims the carrier did not complete engineering and repair work on plane engines to the correct safety standard.

The alleged safety violations were found from 2007 through 2011, and $24.9 million will be paid to settle $162 million in potential fines. As reported by Reuters, $156.5 million involved American Airlines, $5.3 million dealt with Eagle, and $647,000 involved two AMR subsidiaries.

The carrier called the settlement a "reasonable resolution" in a filing with a federal bankruptcy court in New York submitted by American Airlines parent company AMR. Spokeswoman Andrea Huguely commented:

"This settlement recognizes the many changes, including enhancements to our maintenance and engineering processes, increased training, inspections, and audits that have taken place at American over the past several years that address past FAA concerns."

Although the carrier denies any wrongdoing, the firm believes that accepting the fine is a better option than an uncertain investigation by the FAA which could result in far higher penalties.

AMR is expected to merge with US Airways Group by September this year after completing bankruptcy proceedings.

Read More: Skift

Image credit: Flickr

— By on May 11, 2013, 3:03 AM PST

Charlie Osborne

Contributing Editor

Charlie Osborne is a freelance journalist and photographer based in London. In addition to SmartPlanet, she also writes for business technology website ZDNet and consumer technology site CNET. She holds a degree in medical anthropology from the University of Kent. Follow her on Twitter. Disclosure