The High Court has provided a judgment affirming that a hedge fund which acquired positions in certain tax lease structures is entitled to its claim against Vietnamese airline, Vietjet Aviation Joint Stock Company (“VietJet”), although the exact substance of that relief has yet to be determined.
Continue Reading Distressed JOLCOs: lessons learnt from recent High Court case
U.S. Department of Transportation focused on pursuing consumer protection violations against airlines
Recent news headlines relating to air travel have demonstrated the aviation industry’s refocus on passenger experience and consumer protection issues. Airlines are working hard to address scenarios that may affect the passenger experience during air travel today, including remediating weather delays and personnel-related issues. The Biden Administration has made consumer protections in the aviation industry
New Jersey Supreme Court clarifies who may attend a Defense Medical Examination (DME) and whether the examination may be recorded
In a New Jersey personal injury action, when a plaintiff alleges physical and/or mental injury as a result of the defendant’s negligence or other tortious conduct, the defendant is entitled to have the plaintiff examined by one or more medical experts pursuant to New Jersey Court Rule 4:19. The purpose of such examinations is for defense-retained medical experts to assess and offer opinions concerning the injuries the plaintiff is claiming in the lawsuit. Oftentimes, the plaintiff’s counsel will request that a third-party be present for the DME or that it be audio or video recorded. Such requests typically lead to disagreements between counsel and ultimately motion practice. Continue Reading New Jersey Supreme Court clarifies who may attend a Defense Medical Examination (DME) and whether the examination may be recorded
Southern District of New York dismisses defendant bank in 9/11 litigation for lack of personal jurisdiction
After 9/11, waves of lawsuits were filed seeking to hold those who sponsored and supported the al Qaeda terrorist organization accountable. For instance, insurance companies, who paid out hundreds of billions of dollars in compensation for property damage and personal injuries as a result of the 9/11 attacks, filed subrogation lawsuits against al Qaeda and a host of other terrorist organizations, individual terrorists, nation states[1], and financial institutions allegedly involved in providing support and financial assistance to certain 9/11 hijackers and plotters. In addition, family members of those killed in the attacks, as well as those injured, also filed lawsuits. These lawsuits, among others, were consolidated into a multi-district litigation captioned In Re Terrorist Attacks on September 11, 2001. Continue Reading Southern District of New York dismisses defendant bank in 9/11 litigation for lack of personal jurisdiction
U.S. Court refuses to dismiss indemnity claims against U.S. Government in Kobe Bryant helicopter crash lawsuit
On Monday May 3, 2021, the California federal district court judge handling the Kobe Bryant helicopter crash lawsuit denied the United States Government’s motion to dismiss claims made against it by Island Express Helicopters, Inc.—the helicopter charter company operating the fateful helicopter flight—for indemnity.
Continue Reading U.S. Court refuses to dismiss indemnity claims against U.S. Government in Kobe Bryant helicopter crash lawsuit
Aviation manufacturers take note as the U.S. Supreme Court rules on the extent of specific personal jurisdiction under the Due Process Clause and opens the door to future suits
On March 25, 2021, the U.S. Supreme Court handed down a decision which rejected a narrow construction of specific personal jurisdiction under the Due Process Clause. In Ford Motor Co. v. Mont. Eighth Judicial Dist. Court, the Supreme Court clarified the limits of specific personal jurisdiction and litigants’ due process rights and held that Ford Motor Co. can be sued in Montana and Minnesota over accidents involving used cars in those states even though the cars were not designed, manufactured, or sold in those states. The decision has significant implications for the scope of personal jurisdiction under the Due Process Clause, including for aviation manufacturers in product liability actions that are filed outside of their home jurisdiction.
The court’s ruling was 8-0, with Justice Alito filing a concurring opinion and Justice Gorsuch filing a separate concurring opinion that was joined by Justice Thomas. Justice Barrett did not participate.
In 2017, the Supreme Court held in Bristol-Myers Squibb Co. v. Superior Court of California, 137 S. Ct. 1773 (2019), that specific personal jurisdiction can be exercised over a defendant pursuant to the Due Process Clause only when (1) a defendant “ha[s] purposefully availed itself of the privilege of conducting activities within the forum state” and (2) when the plaintiff’s claim “arise[s] out of or relate[s] to” the defendant’s forum conduct. The Supreme Court’s decision in Ford Motor Co. examined the limits of the second prong—that a plaintiff’s claim must “arise out of or relate to” the defendant’s forum conduct.
Continue Reading Aviation manufacturers take note as the U.S. Supreme Court rules on the extent of specific personal jurisdiction under the Due Process Clause and opens the door to future suits
Case Note: What does ‘give possession’ mean under the Cape Town Convention?
Original decision: Wells Fargo Trust Company, National Association (trustee) v VB Leaseco Pty Ltd (administrators appointed) [2020] FCA 1269
Appeal: VB Leaseco Pty Ltd (Administrators Appointed) v Wells Fargo Trust Company, National Association (trustee) [2020] FCAFC 168
The Federal Court of Australia has provided important guidance on the meaning of the phrase “give possession of the aircraft object to the creditor” as used in Article XI of the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment (the Aircraft Protocol) in the context of an insolvency. It is likely that other common law (and possibly civil law) Cape Town jurisdictions would reach a similar conclusion.
Continue Reading Case Note: What does ‘give possession’ mean under the Cape Town Convention?
Case Note: Odyssey Aviation Ltd v GFG 737 Limited
Speed read
A party should not assume that the failure of its counterpart to provide or satisfy conditions precedent gives rise to an automatic right to terminate or not perform a contingent obligation, where it could have obtained or satisfied those conditions precedent itself.
Summary
The recent Odyssey Aviation Ltd v GFG 737 Limited[1] in the English High Court saw both the buyer and seller under an aircraft purchase agreement (the ‘APA’) claiming the deposit, as both parties attempted to terminate the APA on the basis of various alleged breaches of warranty, failure to satisfy conditions precedent and non-payment of purchase price and fees.
The case is significant for aviation sale and leasing practitioners, especially in relation the satisfaction of conditions precedent which is noteworthy for transactional lawyers more generally. It was held that a term should be implied in the APA where a party was to ‘have received’ certain documents, evidence or confirmations, or that the sale would take place ‘subject to the fulfilment’ of conditions precedent, the recipient should take ‘reasonable steps’ to obtain them themselves. This was held to be the case even where there is no express obligation to this effect. Failure to take these steps will mean that the intended recipient would not be able to rely on the other party’s failure to satisfy the condition precedent as a ground for termination.
Continue Reading Case Note: Odyssey Aviation Ltd v GFG 737 Limited
New Sikkelee decision from the U.S. Court of Appeals for the Third Circuit – state law claims against type certificate holders are not conflict preempted
In a very significant, closely watched aviation product liability preemption case in the U.S. Court of Appeals for the Third Circuit, Sikkelee v. Precision Airmotive Corp., et al., No. 17-3006, 2018 WL 5289702 (3d Cir. Oct. 25, 2018), the court recently held that state law claims against type certificate holders can go forward unless the defendant can show that the FAA would not have approved a plaintiff’s proposed change to the FAA type certificate. The court held that the plaintiff’s design defect claims against Lycoming, the type certificate holder for the engine on the accident aircraft, were not conflict preempted because Lycoming was in a position to make changes to its type certificate and was unable to show that the FAA would not have approved the alternative engine design the plaintiff proposed. The court emphasized that allowing state law claims to proceed against type certificate holders complemented the federal scheme and furthers its purpose of ensuring the safety of aircraft. Accordingly, under this ruling, it appears that the only time a type certificate holder can potentially succeed with a conflict preemption defense under these circumstances is if there is clear evidence establishing that the FAA would not have approved an alternative design proposed by the plaintiff.
The dissent held that the claims were preempted and pointed out significant issues with the majority’s decision. The majority relied primarily on a U.S. Supreme Court case which held that state law claims against brand name pharmaceutical manufacturers are not preempted because the manufacturer was able to implement changes prior to receiving FDA approval. The dissent pointed out the critical distinction between that case and Lycoming – unlike a brand name pharmaceutical manufacturer, an FAA type certificate holder cannot implement design changes without prior FAA approval. Thus, the dissent held that the majority’s analysis was flawed because it would be impossible for Lycoming to independently implement the changes that the plaintiff alleged state law required.
Continue Reading New Sikkelee decision from the U.S. Court of Appeals for the Third Circuit – state law claims against type certificate holders are not conflict preempted