Another Pan Am Rises

Upstart airline lifts off with an old emblem

Pan Am - a name once synonymous with pioneering the airline industry - is back in the air again with just a few flights but big plans.

Noted for global routes charted by Charles Lindberg, this reincarnation of the airline has domestic flights only - between New York, Miami, and Los Angeles. But building on its reputation, Pan Am officials say the long-term goal is to feed passengers to international airlines. It already has agreements with more than a dozen carriers.

The original Pan Am's 65-year run came to a shabby close in 1991, following a slow dive into bankruptcy, and three years after the explosion of Flight 103 over Lockerbie, Scotland.

With its name and reputation linked to Flight 103, the timing of Pan Am's rebirth is awkward. It comes two months after the unexplained explosion of TWA Flight 800, three months after the Federal Aviation Administration shut down ValuJet (which returned to the skies yesterday), and a heightened public awareness for the fallibility of air travel.

To some, Pan Am's rebirth represents a vibrant airline industry, in which upstarts - an entrepreneur with a fat bankroll, a few jets, and the right personnel - continue to launch new airlines in the wake of deregulation. It's an industry, they say, that rightly gives Pan Am another chance to recapture profits and glory in an industry it helped create.

To others, the return of the blue globe-emblazoned planes is a poorly timed reminder of the human toll exacted when security is cut to save costs.

In 1988, a bomb allegedly planted by Libyan terrorists tore apart Flight 103, killing 270 people. Many relatives of the victims are convinced Pan Am sacrificed safety for profit when it began to x-ray unaccompanied baggage instead of searching them by hand, which had been required by the FAA since 1986.

In 1992, a Brooklyn jury agreed, finding Pan Am guilty of willful misconduct for disregarding the FAA hand-search rule. Investigators had found that a bomb planted in a radio/cassette player in an unaccompanied suitcase was mistakenly loaded.

No Pan Am officials were charged. But some families of Lockerbie victims filed objections with the Department of Transportation this summer claiming that Martin Shugrue - now chief executive officer of the new Pan Am - was culpable for the fateful security cutbacks.

"If anybody else had restarted Pan Am - somebody new, somebody different - I think I could probably live with it," says Aphrodite Tsairis, of Franklin Lakes, N.J., whose daughter - Alexia, a Syracuse University student - died on Flight 103.

THE new Pan Am got started this year when Mr. Shugrue, who had been bankruptcy trustee for the Eastern Airlines estate, purchased a fleet of Airbus aircraft from Eastern. He then teamed up with investors, including Miami developer and financier Charles Cobb, who in 1993 had purchased at a bankruptcy auction the rights to the Pan Am name, logo, and "intellectual property."

Pan Am officials have pointed out that Shugrue, the chief operating officer at the old Pan Am, left months before the Lockerbie explosion and that the new Pan Am is just that: a new company, with no ties to the Lockerbie-era Pan Am. But at the same time, they are banking on the name recognition of the Pan Am of old.

"There was quite a bit of research done and it was felt that the Pan Am name still had some value - despite the liquidation and bankruptcy and the tragedy," says Jeff Kriendler at Pan Am.

On Sept. 18, the DOT ruled that "a thorough examination of any role Mr. Shugrue might have played ... found no evidence that he was responsible" for watering down Pan Am security in 1988.

Last week at John F. Kennedy Airport, the inclination was also to forgive and move on. Frank Starapoli, of Norwood, N.J., said before boarding Flight 21: "You have to go forward.... Pan Am certainly didn't plant that bomb."