In the battle of the bankrupt airlines, Mesaba Aviation [MAIR] late last week won a $5.2 million payment from Northwest Airlines [NWACQ].

At issue in the fight is the right to withhold aircraft lease payments during the first 60 days while operating under Chapter 11 reorganization. Northwest, which filed Chapter 11 on Sept. 14 in New York, has been withholding lease payments on mainline and regional aircraft from its leaseholders. After Mesaba filed its own Chapter 11 petition in Minnesota on Oct. 13, Mesaba began withholding its lease payments on aircraft it subleases from Northwest.

Northwest retaliated against Mesaba's move by deducting the missing lease payments from the semi-monthly checks it wrote to Mesaba under the terms of their airline services agreement. By the time Mesaba filed the suit on Nov. 7, it said Northwest owed the regional more than $5.2 million.

In papers filed with Judge Gregory Kishel in Minnesota, Mesaba said that if Northwest continues to hold back missing lease payments until Dec. 12 Mesaba will be out more than $10.9 million - money that it had planned to use to finance its reorganization.

On Nov. 9, Northwest tried to get the complaint thrown out by appealing to its bankruptcy judge in New York. Northwest claimed that Mesaba's move violated bankruptcy law provisions that protect a debtor from being sued during that 60-day period as well as provisions in the airline services agreement that the two sides signed on Aug. 29.

However, the New York judge refused to grant the temporary restraining order that Northwest sought. The judge told Northwest to initially contest the issue in the Minnesota court.

In addition to ordering Northwest to pay Mesaba the $5.2 million, Kishel in Minnesota told Northwest not to withhold any future lease payments - the next check is due to Mesaba on Nov. 14. Kishel also denied Northwest's request for a delay as the network carrier considered an appeal.

"We felt that we were exercising our rights within the bankruptcy law. We are disappointed in the ruling and are reviewing our options," Northwest stated in a statement.

Mesaba was pushed into Chapter 11 because Northwest is withholding more than $30 million in payments for services provided before Sept. 13. In addition, Northwest has ordered Mesaba to park 19 airplanes and could potentially remove all but 16 of the 100 planes Mesaba has been flying.