Reuters reported that U.S. Trustee Tracy Hope Davis, the Justice Department official charged with regulating bankruptcy cases in New York, filed papers in U.S. Bankruptcy Court arguing that the $20 million severance package for AMR’s chief executive Tom Horton violates bankruptcy law.

Reuters said that Davis contends in bankruptcy severance is only acceptable when it is part of a program applicable to all employees and is not more than ten times the average severance given to non-management employees. Horton’s package meets neither criteria, Davis said, according to Reuters.

To read the full Reuters article click here.

Previously on abfjournal.com:

American Airlines Receives Court Approval for $3.25B Loans, Friday, May 10, 2013