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American Airlines takes step back as judge throws out pilots union contract

NEW YORK--American Airlines took a major step toward emerging from bankruptcy Tuesday, when a federal judge threw out its pilots' union contract.

The airline's management has already negotiated concessions from its flight attendants, maintenance workers and other unionized employees. The decision by Judge Sean H. Lane will now let the Fort Worth-Texas airline lower its pilot payroll.

The move will quicken American's emergence from Chapter 11 bankruptcy protection, either as a stand-alone airline or potentially merged with U.S. Airways Group Inc.

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