New York Court Throws Out Wheels Up Suit Against flyExclusive
The Supreme Court of the State of New York has dismissed a lawsuit filed by private aviation company Wheels Up against fellow charter operator flyExclusive, ruling that it does not have jurisdiction over the case. The decision, issued on December 3, brings a procedural end to a legal dispute that dates back to 2023, though it leaves the door open for further litigation.
Wheels Up, which is headquartered at Teterboro Airport in New Jersey, had alleged that flyExclusive wrongfully terminated a contract covering guaranteed flight services. The agreement was part of a guaranteed revenue program that was scheduled to run through March 2024 and involved USD37.5 million in deposits.
In its ruling, the New York court concluded that it lacked jurisdiction because flyExclusive is based in North Carolina and does not have sufficient ties to New York. The court noted that flyExclusive was neither formed in the state nor maintains an office there, making New York an improper venue for the case.
The dispute centers on sharply differing accounts of how and why the contract ended. Wheels Up claimed that flyExclusive abruptly terminated the agreement during a busy holiday travel period, disrupting service and causing financial harm. According to Wheels Up, the termination was unjustified and breached the terms of the guaranteed flight arrangement.
flyExclusive, however, argued that Wheels Up was in default under the contract, giving it the right to end the agreement. The North Carolina-based operator has maintained that its actions were consistent with the terms of the deal and that Wheels Up failed to meet its contractual obligations.
By dismissing the case without prejudice, the court has allowed Wheels Up the option to refile the lawsuit in a jurisdiction it deems appropriate, such as North Carolina. A dismissal without prejudice does not address the merits of the underlying claims, but instead reflects a procedural determination regarding where the dispute should be heard.
The ruling highlights the importance of jurisdictional considerations in commercial aviation disputes, particularly in cases involving companies operating across multiple states. It also underscores the growing complexity of contractual relationships in the private aviation and charter sector, where guaranteed revenue and block-hour agreements are increasingly common.
Neither Wheels Up nor flyExclusive commented on the court’s decision. Whether Wheels Up chooses to pursue the matter further in another court remains unclear, but the dismissal marks a notable development in a high-profile dispute between two prominent players in the US private aviation market.
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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com