in 1934, following charges of favoritism in the contracts, the air mail scandal erupted, leading to the air mail act of 1934, which dissolved the forced transcontinental/western merger and ordered the united states army air service to deliver the mail. however, transcontinental opted to retain the t&wa name. with the company facing financial hardship, lehman brothers and john d. hertz took over ownership of the company. the army fliers had a series of crashes, and it was decided to privatize the delivery with the provision that no former companies could bid on the contracts. t&wa added the suffix "inc." to its name, thus qualifying it as a different company. it was awarded 60% of its old contracts back in may 1934, and won back the rest within a few years.