Tech and AI

Google wins a bankruptcy auction for a collapsed airline's internal records to train AI, and the cabin crew union asks the court to stop it

By Staff Writer  |  20 August 2026

Bidding on 14 August opened at 5 million dollars and closed at 10 million. The estate accepted a 7.5 million dollar back-up bid from a rival AI data firm. The union representing more than 5,500 flight attendants objected on 18 August, arguing that the privacy protections in the sale agreement were written for customers and not for staff. The hearing has moved to 9 September.

Spirit Airlines stopped flying on 2 May. What was left included the thing every collapsed business leaves behind and nobody used to price: decades of internal email, chat, human resources files, payroll history, training records and operational data. In a bankruptcy that material is an asset, and in 2026 it has a buyer.

The auction

The sale process is described in a filing supporting the sale by an officer of the estate's investment bank. Google opened at 5 million dollars and undertook from the start to pay for a third party to strip personally identifying information out of the data. Competing bids that asked for extra customer data were rejected, and after the first round any bid seeking to include identifying information was set aside. The nearest rival, an AI data firm, wanted to do the stripping itself rather than through a third party. Google won at 10 million dollars, and the estate accepted the rival's 7.5 million dollar bid as a back-up if Google does not complete.

Google agreed to keep the data in de-identified form, never to re-identify it intentionally, and to bind any third party it sells access to on the same terms. A court appointed ombudsman oversees the de-identification. A department watchdog had already asked for an independent consumer privacy ombudsman to be appointed for the estate's asset sales.

This is outrageous! We are filing a court objection to Google's attempt to buy data that has no business being sold.

Sara Nelson, International President of the Association of Flight Attendants-CWA

The objection

The union's point is a drafting point, and it is a good one. The privacy architecture of the transaction, it argues, is consumer-facing, while its payload is disproportionately employee-facing. The protections were built on consumer privacy law. Consumer privacy law does not carry a duty of worker confidentiality, so the employee material, which is the more confidential of the two, receives the weaker protection.

De-identification, the objection says, addresses whether a record can be traced to a named individual. It does not address whether the contents of the record are confidential. A disciplinary letter, a training deficiency, a leave or accommodation request, an internal message about staffing or a payroll adjustment history stay sensitive whether or not the name has been removed.

There is a second limb, about small populations. Where a defined and highly structured workforce is described across linked operational and communications data spanning more than a decade, the union says the risk that information about identifiable individuals or small groups can be inferred is not speculative, and the buyer's covenant reaches only intentional association. It makes no technical claim that a particular record can be re-identified, and says it does not have to.

The objection is limited. It does not ask the court to stop the sale outright. It asks the court to refuse approval until the buyer agrees to exclude flight attendant material, or at least to extend to former staff the same protections given to customers, and to notify workers when a third party is allowed access.

What the estate is really selling

A company spokesperson said the buyer acquired part of an enterprise dataset that can help improve its products and AI models, that it will receive no personal information, and that anything it receives will be scrubbed by a third party before receipt.

The wider point for insolvency practitioners on this side of the Atlantic is that a data estate is now a realisable asset with a competitive market behind it, and that the consideration is small next to the questions it raises. Two bidders fought for two and a half hours over records generated by people who were not in the room, are no longer employed, and were never asked. Whatever the court decides on 9 September, the next administration of a business with a long email history will have to decide what its office holders may sell, and under which body of law the people in those emails are protected.