The nation's largest airline is struggling to avoid bankruptcy. Its chief executive was ousted Thursday because he didn't disclose executive perks granted while he was seeking wage concessions from company unions.
On Friday, the Transportation Department issued its first racial bias complaint ever against an airline, saying that 10 people were removed from American flights or denied boarding because they were perceived to be Middle Eastern, Southeast Asian or Muslim.
Most of the incidents cited in the administrative complaint happened to U.S. citizens and occurred within three months of the Sept. 11, 2001, terror attacks, the department said.
American said it would fight the charges and denied that passengers were discriminated against by its crew or the crew of American Eagle, its commuter arm. The case will be heard by an administrative law judge.
"All of the airlines, as well as the nation, were under heightened security during this time and American (and American Eagle) employees were following the directives of the president and the attorney general to be vigilant in the face of terrorist threats," the airline said in a statement.
It said that vigilance prevented Richard Reid from igniting a shoe bomb on an American flight in December 2001.
Reid, a scruffy-looking 29-year-old British citizen and convert to Islam, pleaded guilty in Boston last October to attempting to blow up the Paris-to-Miami flight.
Transportation officials said some of the passengers who complained were rebooked on American or another airline without any additional screening, though they'd been removed from their American flight as security risks.
Hussein Ibish, spokesman for the American-Arab Anti-Discrimination Committee, said he was very pleased the complaint was filed. The committee filed discrimination lawsuits against three airlines last spring.
"This is excellent," he said. "Yes, we had these incidents, but the government is responding in the way we would hope it would."
Among those not allowed to fly were Rep. Darrell Issa, R-Calif., and a Secret Service agent on President Bush's security detail, Ibish said.
There have been many complaints filed by the government against airlines for discriminating against disabled people, but never before about race, color or national origin, said Chet Lunner, a Transportation Department spokesman. "This is the first time on racial grounds," he said.
American could be fined as much as $65,000 plus penalties for any other violations that might be discovered during an administrative hearing.
On Friday, flight attendants agreed to cost-saving concessions that allow American to avoid imminent bankruptcy, although the carrier still faces a financial pinch and tense labor relations.
With company officials and lawyers poised for a possible Chapter 11 filing Friday, the Association of Professional Flight Attendants agreed to $340 million in annual cost cuts.
Unions representing pilots and ground workers had approved the concessions late Thursday and applied additional pressure on the flight attendants to go along, fearing American would make good on threats to cut even more jobs and wages in bankruptcy.