After small talk about wine at a chic Manhattan trattoria in 2011, the gatekeeper of New York’s airports asked for the small favor that would torpedo one of global air travel’s most powerful men.
David Samson, a close ally of New Jersey Gov. Chris Christie, wondered aloud whether United Airlines chief Jeff Smisek might help restart a twice-canceled, money-losing flight from Newark to Columbia, S.C., where the then-chairman of the Port Authority of New York and New Jersey owned a pastoral weekend home.
For Smisek and two other United senior executives at the table, according to a Bloomberg News account of the dinner, the awkward request was seen as the trade-off for boosting business at one of the beleaguered airline’s most profitable hubs. Within a year, the flight was a go.
But this week, the short-lived “chairman’s flight” backfired. Having triggered a federal investigation that led to those executives’ sudden ouster, it now threatens to further cripple one of America’s biggest airlines and Christie’s already-turbulent presidential campaign.
“General Samson,” as Christie called him, was a prominent New Jersey juggernaut who founded one of the state’s most powerful legal firms. Smisek, whom Fortune magazine once dubbed the industry’s “king of the skies,” piloted the 2010 megamerger that gave United the world’s largest fleet of commercial jets.
But amid the evolving corruption investigation, their fates now seem inextricably linked to a cramped, 50-seat regional plane and a deal that has helped expose the underbelly of how some of American air travel’s deals get done.
The U.S. attorney for New Jersey and a federal grand jury have requested records and filed subpoenas in the ongoing investigation, though prosecutors have yet to outline any charges. In February, the airline followed the government probe with an internal investigation.
The airline said this week that the executives’ departure came in connection to the federal probe. But investigators have yet to say whether the dinner at Novitá, detailed in April by Bloomberg News, has figured into their investigation.
Karen Kessler, a spokeswoman for Samson’s legal team, said, “This is about United, and that’s all I have to say.”
When Samson and Smisek met for dinner, both men were one year into perhaps the most powerful posts of their career.
Samson, a key member of Christie’s fiercely loyal inner circle, had been appointed by the governor to lead the powerful transit agency that commands an $8 billion yearly budget and oversees the area’s vast network of bridges, rail lines and ports.
Smisek, the former chief executive of Continental Airlines, had risen to power by helping engineer its megamerger with United, then won a fight to stay on as the air giant’s chief executive, chairman and president. After his ascendance, USA Today called Smisek “arguably the airline industry’s most powerful executive.”
But Smisek’s celebration would be short lived. The merger quickly faced heavy pressure from shareholders, labor uprisings and technical nightmares. Union contracts forbid the now-unified cabin crews to serve on certain planes, adding logistical headaches, and the airlines’ differing reservation and computer systems were agitating customers and sparking delays.
The airline, the biggest carrier at Newark Liberty International Airport, spent years pushing the Port Authority for a cheaper airport lease, upgrades to help accommodate its newer jets, and an extension of the PATH rail line for Newark travelers seeking a direct train ride to Manhattan.
Continental’s Columbia-Newark route, first launched in 1990, flew several years of unprofitable stints before getting the ax in 2009. But at the dinner, reported Bloomberg News, citing people familiar with the incident, Samson said its revival could save him time on his weekend travels to Aiken, S.C., where he owned a 4,000-square-foot cottage named Rest Period in an equestrian community known for its polo club.
One year later, in September 2012, the “chairman’s flight” took its maiden voyage. But soon, Samson was taking heat for the Bridgegate scandal, in which Christie staffers and appointees were accused of creating traffic jams to hurt a mayor who had not backed Christie’s 2013 gubernatorial campaign.
Samson stepped down from the Port Authority last year amid the Bridgegate fallout. Four days later, on April 1, United canceled the routinely half-empty flight.
Though low jet-fuel prices have boosted United’s profit, the $21 billion airline has continued to struggle to compete with rival carriers.
In the first half of the year, federal data shows, only 3 out of 4 United flights arrived without delay, the worst on-time performance of America’s four big airlines. Earlier this year, research firm J.D. Power said United scored its worst consumer-satisfaction ranking of all airlines in North America.
Smisek was widely blamed for the airline’s cost-cutting measures, routine tardiness and growing customer dissatisfaction. Calling Smisek “the guiding hand in wrecking the company,” a group of United retirees earlier this year demanded that he resign in a petition that attracted more than 10,000 signatures and the support of Ralph Nader.
A Change.org spokesman said it was one of the site’s largest executive-removal petitions, behind a campaign to remove the head of a catering company caught on tape kicking a puppy.
The airline complained last year to federal regulators that the Port Authority’s soaring fees at the Newark airport were due to “unwise choices, inefficiencies and political influences.”
The “excessive” fees, airline representatives said, amounted to discrimination against the airline, and they asked the Federal Aviation Administration to audit the Port Authority’s decision-making on finances and fees.
Smisek, meanwhile, was tossed off with what analysts called a truly golden parachute. He will pocket a $4.9 million cash separation payment and company stock worth nearly $3.5 million, and he can keep his company car, parking spots at airports in Chicago and Houston, and lifetime privilege of free flights.
New Jersey state Sen. Joe Vitale said people who have long respected Samson are “scratching their heads” at the possibility that such a “sharp legal mind” allegedly stumbled on something so obviously wrong.
Vitale said he is waiting for the investigation, but he said United’s high-ranking dismissals seemed to suggest that investigators had found something was amiss, adding, “You don’t fire your boss without something being credible.”
Katie Zezima, Jenna Portnoy, Jena McGregor and Thad Moore contributed to this report.