Not quite -
"The Company’s total liability for future AAdvantage award redemptions for free, discounted or upgraded travel on American, American Eagle or participating airlines as well as unrecognized revenue from selling AAdvantage miles was approximately $1.4 billion (and is recorded as a component of Air traffic liability on the accompanying consolidated balance sheets) at December 31, 2010 and $1.5 billion as of December 31, 2009."
Exactly. Of the $1.4 billion of liability, the vast majority of that figure represents the unrecognized revenue from selling miles to third parties, not liability for award redemptions. Since AA recognizes that revenue over a 28 month period, it's likely that the unrecognized revenue portion is more than $1.0 billion of that $1.4 billion total liability. That means the liability on the balance sheet for unredeemed award redemptions is valued by AA at something less than $400 million. Not a very large liability for a company having over $25 billion in total liabilities.