THE CASE: AMR Corp.'s American Airlines began laying out its case Monday for voiding union labor contracts, which is allowed under bankruptcy law. AMR told a federal bankruptcy court judge in New York that it needs to reduce labor costs to become financially stable.

BURDEN OF PROOF: AMR must convince the judge that it needs to throw out the contracts to succeed, and that it tried to negotiate concessions with its unions.

HIGH STAKES: If American wins, its nearly 55,000 union pilots, flight attendants and ground workers could lose pay, see pensions frozen or terminated, and absorb other cuts. American wants to eliminate 13,000 union jobs.