Behind the scenes of the proposed $11 billion merger between American Airlines Inc. and US Airways Group Inc. are groups of in-house and outside counsel struggling with the myriad legal issues involved in creating the world’s largest airline. But they won a unique victory in December when marathon negotiations ended in an agreement with both companies’ pilot unions.

"This deal culminated after a fairly dramatic, two-week, round-the-clock, multiparty negotiating process in a room in Dallas over the Christmas [holidays]," recalled labor lawyer Robert Siegel. He is a partner at O’Melveny & Myers and was representing US Airways.

"Well, we did take some sleep breaks," Siegel corrected himself, "but there were some all-night efforts, and all of them were late-night efforts." Fortunately the negotiating room was located in law offices across the street from the hotel.

He said the deal helped pave the way for the two airlines to announce their approval of the merger on Feb. 14.

It still must pass federal antitrust and bankruptcy court scrutiny.

What made the agreement unique were two factors. First, the deal was cut as part of the merger negotiations while American Airlines was still in Chapter 11 proceedings in U.S. Bankruptcy Court for the Southern District of New York.

"As a general proposition, the fact that [the merger] is being done inside the bankruptcy is very significant," Kristin Going, a bankruptcy attorney at Drinker Biddle & Reath, told The Washington Post this week. Going represents Manufactures and Traders Trust Co., a large creditor of American Airlines’ parent company.

"With that comes many different specific scenarios that haven’t really been dealt with before," she told the newspaper.

Paul Jones, US Airways’ vice president for legal affairs, recalled that the idea to negotiate with the pilots’ unions before the merger closes came from his company president, Scott Kirby.

Siegel, who has worked through several airline mergers, explained that normally each union remains at status quo until a merger is complete.

But then it might take several years to negotiate a new contract with the new entity, Siegel told CorpCounsel.com Tuesday. "This was a much more constructive way to approach it."

The second unique factor, Siegel said, was the presence of five different parties in the tension-filled negotiating room. "It’s tough enough when there are two sides negotiating," Siegel sighed, "but with five. …Let’s just say we went through a lot of human drama."

Present were in-house and outside counsel for both airlines, lawyers for both pilot unions, and representatives and lawyers from the creditors committee in bankruptcy court.

Jones, the US Air GC, said the unusual presence of the unsecured creditors committee actually helped. "They oversaw the negotiations and actively participated, steering us to where we ended up," he said.

But Jones, recalling his time in the negotiating room, admitted the talks sometimes grew tense. "I wouldn’t say there was a lot of yelling and shouting, but I can’t say that no one lost their temper," he said. "But in the end it was a collaborative effort" that everyone felt good about.

Siegel, who was joined in the negotiations by O’Melveny law partner Chris Hollinger, agreed. "At times it was heated, but at other times it was extremely collaborative, especially at the end," he said.

He explained that the companies obtained a predictable cost structure, which they wanted, while the pilots of both airlines won common terms for employment, which they wanted. "In the end," he said, "it was extremely gratifying."