LATAM looks to settle decade-long Colombian Q300 dispute
LATAM Airlines Group has asked the US Bankruptcy Court in New York to approve a USD9.55 million settlement agreement between its Colombian subsidiary, Aerovías de Integración Regional Aires S.A. dba LATAM Airlines Colombia (4C, Bogotá), with US companies Regional One and Dash 224 that would end a decade-long legal dispute over an aircraft that was attached by the Colombian tax and customs authority.
US Bankruptcy Court Judge James L. Garrity Jr. is to hear the motion on November 30 according to a filing on November 5. This followed months of settlement discussions during which the parties successfully had resolved the ongoing dispute through mediation, the docket read.
LATAM said it believed the settlement to be reasonable. If approved, it would also allow it to reduce by almost USD20 million claims against it in its ongoing Chapter 11 bankruptcy case in New York. It would also avoid a potentially costly consolidated trial in Florida, USA. Any objections to the proposed settlement must be filed by November 23.
The case relates to a January 2000 lease agreement relating to DHC-8-300 msn 224 – previously registered as HK-4107X – entered into by LATAM Airlines Colombia and VAS Aero Services. The aircraft is now operated by Policía Nacional Colombiana (Bogotá) under the registration of PNC-0259, according to ch-aviation fleets advanced data.
On April 22, 2010, LATAM Airlines Colombia, known as Aires (4C, Bogotá) at the time, and VAS agreed on the termination of the lease and the ferrying of the aircraft from Florida back to Colombia. Regional One took over the lease a day later and Aires agreed to return the aircraft to Fort Lauderdale, Florida, where it was sold to Regional One, before being ferried back to Colombia.
On April 26, 2011, the Colombian tax and customs authority (Dirección de Impuestos y Aduanas Nacionales) seized the aircraft in Colombia. In July 2012, Aires filed a lawsuit against Regional One and VAS before a civil court in Bogotá, Colombia, while a year later, Regional One and Dash together filed suit against Aires before the Miami Circuit Court.
The case was subsequently moved to the US District Court for the Southern District of Florida, which has not set a trial date in light of LATAM Airlines Group having filed for Chapter 11 bankruptcy protection on May 26, 2020.
Regional One and Dash have both since filed claims against LATAM Airlines Colombia and parent LATAM. Each of the claims asserts that LATAM Airlines Colombia is liable for USD28 million based on a potential finding by the Florida Court against the airline.