Say Company Is Subsidizing A Personal Airplane Fleet For Founding Family, Company Says Otherwise

One of Nordstrom's shareholders is apparently not particularly happy with the company's flight department, which the shareholder claims is a "vast, bloated, and costly Flight Department" which largely serves the private needs of the family.

The details of the suit, which was filed in federal court in Seattle, are sealed. But the complaint does say that the company owns two airplanes and manages and services eight others that are owned by Nordstrom family members. Those airplanes include four floatplanes and a single-engine turboprop aircraft. The family also owns a Bombardier CL-600 and a Cessna 560 which it leases back to the company, according to a report in the Seattle Times.

The shareholder who brought the suit ... identified as King County, WA resident Judith Burbrink on behalf of the company and its shareholders, says that the company is subsidizing the private use of the aircraft to the tune of millions of dollars.

Nordstrom says that Burbrink has it backwards. The company holds that the family's payments to the flight department to manage the airplanes reduces the costs for flight operations. It also allows the company to make flights available to other employees for events such as store openings, meetings, and visits to fulfillment centers. There were some 330 such trips for Nordstrom employees last year, according to the company.

The paper reports that Nordstrom says that the its aviation department is "well within the industry standards for the number of planes Nordstrom uses." 

The suit is being kept under temporary seal at Nordstrom's request so that the retailer can protect proprietary information. It would require a close look at the costs of providing aviation service to the family by the board of directors, and seeks unspecified damages to be paid to the company.

FMI: www.wawd.uscourts.gov