July 1 (Bloomberg) -- Mesa Air Group Inc. won a federal appeals court ruling upholding an order that bars Delta Air Lines Inc. from canceling a contract for regional flights.

The U.S. Court of Appeals in Atlanta said Delta had gone back on a promise not to count certain Mesa flight cancellations against the regional carrier’s overall flight-completion rate. Delta sought to end flights by Mesa’s Freedom Airlines because its completion rate had fallen. Mesa won a federal court order in May blocking Delta’s plan.

Mesa, a regional carrier that flies mostly for larger airlines, previously said it might be forced to file for bankruptcy protection if it lost its legal fight with Delta.

Delta had assured Mesa that flight cancellations directed by Delta because of unfavorable conditions wouldn’t be counted against Mesa’s overall completion rate after Mesa began operating Delta flights out of New York’s John F. Kennedy Airport, where cancellations are common because of weather and airspace congestion, according to the ruling.

Failure to meet flight-completion rates of 95 percent was grounds to cancel the contract, the appeals panel said. Airlines cancel lower-priority flights to ensure that more-important ones will reach their destinations. Delta directed Mesa to cancel 400 flights in 2007 and 2008, according to today’s decision.

In March 2008, Delta management, responding to higher jet fuel prices, discussed a plan to end certain contracts, including Mesa Air’s, the appeals court said. Delta terminated the contract after Mesa’s completion rate, including Delta- directed cancellations, fell below 95 percent in October and December 2007 and February 2008.

Betsy Talton, a Delta spokeswoman, didn’t immediately return a voice-mail message left after regular business hours.

The case is Mesa Air Group Inc. v. Delta Airlines Inc., 08- 13733, U.S. Court of Appeals for the 11th Circuit (Atlanta).

To contact the reporter on this story: Karen Gullo in San Francisco at kgullo@bloomberg.net.

Last Updated: July 1, 2009 21:07 EDT