Business
Avelo Airlines Faces Backlash for Aiding Trump’s Deportation Campaign
In the four years since its first flight, Avelo Airlines has gained loyal customers by serving smaller cities like New Haven, Conn., and Burbank, Calif.
Now, it has a new, very different line of business. It is running deportation flights for the Trump administration.
Despite weeks of protests from customers and elected officials, Avelo’s first flight for Immigrations and Customs Enforcement appears to have departed on Monday morning from Mesa, Ariz., according to data from the flight-tracking services FlightAware and Flightradar24.
According to FlightAware, the plane is expected to arrive in the early afternoon at Alexandria International Airport in Louisiana, one of five locations where ICE conducts regular flights. Avelo declined to comment on the flight and ICE did not respond to multiple requests for comment.
The airline’s decision to support President Trump’s effort to accelerate deportations of immigrants is unusual and risky. ICE outsources many flights, but they are usually operated by little-known charter airlines. Commercial carriers typically avoid this kind of work so as not to wade into politics and upset customers or employees.
The risks for Avelo are perhaps even greater because a large proportion of its flights either land or take off from cities where most people are progressives or centrists who are much less likely to support Mr. Trump’s hard-line immigration policies. More than 90 percent of the airline’s flights arrived or departed from coastal states last year, according to Cirium, an aviation data firm. Nearly one in four flew to or from New Haven.
“This is really fraught, really risky,” said Alison Taylor, a professor at the New York University Stern School of Business who focuses on corporate ethics and responsibility. “The headlines and the general human aspect of this is not playing very well.”
But Avelo, which is backed by private investors and run by executives who came from larger airlines, is struggling financially.
The money the company stands to make from ICE flights is too good to pass up, the airline’s founder and chief executive, Andrew Levy, said last month in an internal email, a copy of which was reviewed by The New York Times. The flights, he said, would help to stabilize Avelo’s finances as the airline faced more competition, particularly in and near New Haven, which is home to Yale and where the airline operates more than a dozen flights a day.
“After extensive deliberations with our board of directors and our senior leaders, we concluded this new opportunity was too valuable not to pursue,” Mr. Levy wrote in the email on April 3, a day after Avelo signed the agreement with ICE.
While the military carries out some deportation flights, ICE relies heavily on private airlines. There is little public information about those flights, which ICE primarily arranges through a broker, CSI Aviation, said Tom Cartwright, a retired banking executive who has tracked the flights for years as a volunteer with Witness at the Border, an immigrants rights group. Most are operated by two small charter airlines, GlobalX Air and Eastern Air Express, he said.
GlobalX started operations in 2021 and conducts flights for the federal government, college basketball teams, casinos, tour operators and others. It has grown rapidly and brought in $220 million in revenue last year but is not yet profitable. This year, it has operated deportation flights to Brazil and El Salvador. Eastern Air Express is part of Eastern Airlines, a privately held company.
GlobalX and Eastern Airlines did not respond to requests for comment.
Contracts for such flights provide airlines consistent revenue, and the business is much less vulnerable to changes in economic conditions than conventional passenger flights. By Mr. Cartwright’s count, which is based on a variety of sources, ICE operated nearly 8,000 flights over the year that ended in April, most of them within the United States. CSI Aviation alone was awarded hundreds of millions of dollars in ICE contracts in recent years, according to federal data.
Avelo’s decision last month to join in on those flights was met with a swift backlash.
Within days of Mr. Levy’s internal announcement, the New Haven Immigrants Coalition, a collection of groups that support immigrants’ rights, started a campaign to pressure Avelo to drop the flights. An online petition started by the coalition has gained more than 37,000 signatures. Protests also sprouted up near airports in Connecticut, Delaware, California and Florida served by Avelo.
The Democratic governors of Connecticut and Delaware denounced Avelo, while lawmakers in Connecticut and New York released proposals to withdraw state support, including a tax break on jet fuel purchases, from companies that work with ICE.
William Tong, the Democratic attorney general of Connecticut, demanded answers of Mr. Levy, who deferred to the federal government. In a statement last month, Mr. Tong called Mr. Levy’s response “insulting and condescending.”
The Association of Flight Attendants-CWA, a union that represents flight attendants at 20 airlines, including Avelo, raised concerns. The union noted that immigrants being deported by the Trump administration had been placed in restraints, which can make flight attendants’ jobs much more difficult.
“Having an entire flight of people handcuffed and shackled would hinder any evacuation and risk injury or death,” the union said in a statement. “It also impedes our ability to respond to a medical emergency, fire on board, decompression, etc. We cannot do our jobs in these conditions.”
Avelo said that under its deal with ICE, it would operate flights within the United States and abroad, using three Boeing 737-800 jets. To handle those flights, the airline opened a base at Mesa Gateway Airport and started hiring pilots, flight attendants and other staff.
In a statement, Mr. Levy, a former top executive at United Airlines and Allegiant Air, said the airline had not entered into the contract lightly.
“We realize this is a sensitive and complicated topic,” he said. “After significant deliberations, we determined this charter flying will provide us with the stability to continue expanding our core scheduled passenger service and keep our more than 1,100 crew members employed for years to come.”
The airline, which is based in Houston, said it had operated similar flights for the Biden administration. “When our country calls, our practice is to say yes,” it said in a separate statement.
In the email last month, Mr. Levy celebrated the fact that Avelo had nearly broken even in 2024, losing just $500,000 on $310 million in revenue. But the airline needs to raise more money from investors, he said. Performance this year has suffered as national consumer confidence has waned, and the airline is facing rising competition.
Avelo was seeking revenue that would be “immune from these issues,” Mr. Levy said in the email, and pursued charter flights, including for the federal government. To accommodate the ICE flights, the airline also scaled back its presence at an airport in Santa Rosa, Calif.
Avelo has raised more than $190 million, most of it in 2020 and 2022, according to PitchBook. Mr. Levy’s email said the airline hoped to secure new funding this summer.
Business
Commentary: The UC faculty just won a big court victory over Trump. But why didn’t UC join their lawsuit?
On Nov. 14 the faculty and staff of the University of California won a significant victory over President Trump in his effort to fine UCLA $1.2 billion for resisting his efforts to bend the university to his ideological demands.
Finding that the plaintiffs submitted “overwhelming evidence” that Trump and his cabinet members pursued a campaign of cutting off government funding with the goal of “bringing universities to their knees and forcing them to change their ideological tune,” federal Judge Rita Lin of San Francisco blocked the fine and nearly $600 million in funding cuts. She ordered the money to start flowing again.
Lin’s ruling resembles those by other federal judges who blocked Trump’s funding cutoffs. Faculty and staff representatives, with the American Assn. of University Professors as the lead plaintiff, justly celebrated the UC injunction, even though it’s likely that the government will appeal.
It may be hard for an educational institution to ride this out until 2029. For an institution that budgets on an annual basis, three years is a long time.
— Dan Schnur, UC Berkeley
But two entities with an interest in the case’s outcome have been silent: the state of California and UC itself. Neither joined the AAUP lawsuit, which was filed in September, and neither has commented since.
It’s not as though the state and the university are blind to the potential impact of Trump’s funding cutoff. When Trump’s demands and threats were made public in August, Gov. Newsom termed them “extortion” and threatened to sue. UC President James B. Milliken said the announced cuts would be a “death knell for innovative work that saves lives, grows our economy and fortifies our national security.”
Addressing the UC Board of Regents at its meeting Wednesday, Milliken stated that the university system still faces the loss of more than $1 billion in federal research funding, but didn’t mention the AAUP lawsuit.
UC reportedly has continued negotiations with the White House. A UC spokesperson wouldn’t comment on any such talks, even to confirm them. A spokesman for Gov. Newsom said he’s closely watching the numerous court cases challenging Trump’s funding threats, and “he’s pleased with the recent court rulings affirming that Trump’s assault on California’s world-class research institutions was reckless and illegal.”
Let’s keep in mind what’s at stake in this battle. The University of California is the premier public university system in the nation. It’s the second-largest employer in the state and one of the most important providers of healthcare. The productivity of its research is spectacular. Much of the universities’ work is supported by the government — $17 billion a year, including matching Medicaid and Medicare funding and student aid.
“We were hopeful that the UC system would defend itself legally,” says Veena Dubal, a law professor at UC Irvine and general counsel to the AAUP. After UCLA published the administration’s 27-page list of demands in August, she says, the AAUP decided it couldn’t wait any longer: “We couldn’t not sue, they were so outrageous.”
The demands included bans on diversity programs, public demonstrations across much of the campus and provisions for transgender students. UCLA also would be required to refuse admission to foreign students “likely to engage in anti-Western, anti-American, or antisemitic disruptions,” and to comply with Trump’s ban on “gender ideology” — that is, defining males and females as anything other than the sex they were assigned at birth.
The state and the UC system haven’t entirely avoided legal jousting with Trump. California led seven other states into federal court to challenge the Dept. of Education’s termination of $65 million in grants funding programs that included diversity, equity and inclusion initiatives. They won at the trial level, but the Supreme Court stayed that ruling on grounds that the case may have been brought in the wrong federal court.
The regents also joined a lawsuit brought by the Assn. of American Universities and 13 other universities challenging the Dept. of Health and Human Services limit on reimbursements for overhead costs on government-funded research, which would cost universities billions of dollars. They won at the trial level, but the government appealed that ruling. The state also sued Trump or participated in lawsuits on other topics.
One can understand, even sympathize with, the reluctance of UC to pursue a courtroom fight over Trump’s demands. UC faces the same quandary as other institutions that have tried to reach accords with the administration.
Trump has almost unlimited tools at his discretion to harass his adversaries for years to come through endless “investigations” of purported statutory violations, among other things. Courtroom battles take time and money, resources that may never be recovered. Plus with a pro-Trump majority on the Supreme Court, ultimate victory is nothing like a certainty.
And while Trump’s term won’t last beyond January 2029, at which point his anti-university campaign might end, that may be cold comfort for institutions facing an immediate financial crisis.
“It may be hard for an educational institution to ride this out until 2029,” says Dan Schnur, a veteran political consultant on the faculty of UC Berkeley’s Institute of Governmental Studies. “For an institution that budgets on an annual basis, three years is a long time, and for a student, it’s three-fourths of an undergraduate experience.”
That brings us to the case the UC faculty and staff made in court. It’s as clear and concise a description of the noxious campaign Trump has conducted against American higher education that one will find anywhere. It was accepted almost in its entirety by Judge Lin.
The administration consistently has portrayed the funding cutoffs as a response to what it claims to be pervasive antisemitism at UCLA and other targeted campuses. Yet as federal Judge Allison D. Burroughs of Boston found in September when she blocked Trump’s grant terminations against Harvard, it’s “difficult to conclude anything other than that [the government] used antisemitism as a smokescreen for a targeted, ideologically-motivated assault on this country’s premier universities.”
Indeed, the UC plaintiffs show that the funding cutoffs were motivated purely by ideology, and flagrantly infringed on free speech rights. Just a week after Trump’s inauguration, the White House issued an order suspending all financial disbursements that involved “DEI, woke gender ideology, and the green new deal.” (“DEI” refers to programs aimed at diversity, equity and inclusion, a favored target of the right.)
The faculty lawsuit quotes Leo Terrell, an assistant attorney general for civil rights and a named defendant, telling Fox News, “The academic system in this country has been hijacked by the left, has been hijacked by the Marxists.” He said, “We’re gonna bankrupt these universities. We’re gonna take away every single dollar.” In an interview he said he had “targeted 10 schools. Columbia, Harvard, Michigan, UCLA, USC… We’re going to take away [their] funding.”
The lawsuit positions the administration’s campaign against UCLA against its similar attacks on funding at Columbia, Brown and Harvard. It also points to the folly of trying to settle with Trump out of court.
Columbia was among the first universities to settle with Trump — it would ultimately agree to $221 million in payments and to give the government extraordinary oversight of its hiring, pedagogical and social policies. Initially that was a response in March to a government threat to block some $400 million in federal grants.
But even after its initial capitulation in March Trump continued to block $1.2 billion in funding until Columbia agreed to additional demands in July.
As Judge Lin described the government campaign against UCLA and other universities launched by the White House, it starts when “one or more … agencies open civil rights investigations into a university…. Before the investigations are concluded, Funding Agencies cancel large amounts of federal funding.” Then the Justice Department offers to settle with the targets “in exchange for further burdening faculty, staff, and student speech.”
It’s theoretically possible that the Trump administration could make its funding cutoffs stick if it follows the procedures enshrined in law for terminating federal grants (and it may yet prevail in appeals to the Supreme Court).
The rules require government agencies to issue a notice of possible violation and attempt to negotiate a settlement and hold a hearing, then file a report with the House and Senate specifying “the circumstances and grounds for such action” and wait at least 30 days more before canceling any funding. The cancellations can apply only to the specific program deemed to be violating the law.
The goal of these safeguards, Lin observed, is to protect grant recipients from “‘vindictive’ or ‘punitive’” actions by the government. In these cases, the government followed none of the mandated procedures.
The administration‘s defense, in part, is that the funding cutoffs are entirely within its discretion and can’t be reviewed by a judge, assertions Lin specifically rejected. The administration also stated that the August demand letter to UCLA was merely an “opening settlement offer” in ongoing “confidential settlement negotiations” with the university.
Given the findings from federal judges that Trump has flouted the legal safeguards against abrupt and arbitrary grant cancellations in favor of illicit bullying, the question facing universities trying to negotiate their way out is: What is there to negotiate? The record so far indicates that no settlement will fully satisfy Trump or his anti-woke warriors; only judges can bring the campaign to a halt.
It’s certainly true that in the short run, Trump’s targets will suffer great pain. He knows well that they’re vulnerable to blunt force. “With every day that passes,” Lin observed, “UCLA continues to be denied the chance to win new grants, ratcheting up [the government’s] pressure campaign.”
In the long run, however, there are limits to how much an educational institution can concede.
One is tempted to recall what Michael Corleone said in “The Godfather Part II” when he was being bullied by the corrupt Sen. Pat Geary into paying a bribe: “My offer is this,” he said. “Nothing.”
It may not be so easy for even powerful universities to take such an uncompromising stand. But it may be necessary.
Business
Skechers investors say they were forced to take a bad deal when the company went private
Skechers investors are suing company executives and Skechers owner 3G Capital over what they say was an unfair sale price in an acquisition earlier this year.
3G Capital took the Manhattan Beach-based sneaker company private in a $9.4-billion deal that closed in September and reflected a share price of $63 per share.
In a class action complaint filed this month in Delaware Chancery Court, hedge funds and other large Skechers investors accused the company and 3G Capital of arranging a non-independent deal that shortchanged minority shareholders.
The deal undervalued the company as its shares were taking a beating because of a volatile federal tariff policy, the complaint said. The deal also benefited Skechers President Michael Greenberg and other controlling shareholders, according to the plaintiffs.
Plaintiffs seeking a higher share price were unable to reach an early settlement with Skechers after the company made an offer that was slightly higher than the original price, Bloomberg reported this week.
According to court documents, 3G Capital had offered a price of $73 per share in March this year, but lowered its offer after Trump’s tariff “liberation day” on April 2.
Investors are now pressing ahead with the case, according to Bloomberg.
Skechers said it would not comment on pending legal matters.
Skechers was one of many footwear and apparel companies that sounded the alarm when Trump passed steep import taxes on countries including China and Vietnam, where many Skechers products are made.
The company’s stock price fell 23% in early April after the tariffs were announced. Shares bounced back up 30% after the 3G Capital deal was announced.
Around the time of the acquisition, 3G Capital and Skechers said the purchase price represented a 30% premium to the company’s 15-day volume-weighted average stock price.
After the deal closed, about 60 investment pools managed by various firms filed to challenge the price of $1.3 billion worth of shares.
Plaintiffs in the case say Chief Executive Robert Greenberg, along with his son Michael, the company’s president, worked closely with 3G Capital to tailor an acquisition deal that worked for them amid tariff chaos.
“The merger was carefully structured to allow the Greenberg stockholders to monetize a substantial amount of their personal Skechers’ holdings,” the court complaint said.
Business
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