Hawaii’s Wing Spirit faces fraud lawsuits as it liquidates

Hawaiian business charter specialist Wing Spirit (Honolulu) has been sued for allegedly defrauding “tens of millions of dollars” from the Japan-Aviation Academy even as the carrier itself undergoes liquidation.

The charter carrier, which launched in 2019 and placed an order for fifteen HA-420s, filed for Chapter 11 restructuring in November 2020. However, its restructuring attempts failed, forcing it to convert the filing to a Chapter 7 liquidation process in March 2021. Proceedings in front of Judge Robert J. Faris at the US Bankruptcy Court for the District of Hawaii are ongoing. Creditors have until August 23 to file their claims against the carrier.

Simultaneously, however, the airline has been facing a lawsuit filed in October 2020, which alleges that its chief executive, Tejiro Handa, defrauded millions of dollars from the Japan-Aviation Academy, gaining the trust of Japan’s oldest aviation school but subsequently misusing the investment funds. The Honolulu Civil Beat online newspaper said the lawsuit alleges Handa abused the investor’s trust, forced it to unnecessarily borrow large amounts of money, and subsequently remunerated himself rather than invest in the start-up.

Other airlines filed by various suppliers allege that Wing Spirit had no intention of paying for various services, including a USD200,000 refurbishment of an executive terminal at Honolulu airport.

Wing Spirit ultimately only took two out of its fifteen ordered HA-420s. While it planned to launch inter-island charters in Hawaii in 2020, these plans were jeopardised by the COVID-19 pandemic. During the early phase of the crisis, the carrier committed to offering USD1 million worth of free flights to Hawaiian doctors to facilitate their essential travel between hospitals on various islands. It is not clear what the uptake was.