New York Jury Rules Against Defunct Airline Over Unpaid Debts

Perhaps, given Southeast Airlines' financial woes, this won't make much difference. But a New York jury last week smacked the company with a $3.7 million judgement in the latest lawsuit over Southeast's debts.

As ANN reported last month, Southeast abruptly shut down, leaving its 350 or so workers with rubber paychecks and stranding hundreds of passengers. The shutdown came just six days before it was dragged into court by Aviation Services International.

The affiliate of Israel Aircraft Industries accused Southeast of welshing on about $5 million in debt for services and parts. Last Wednesday, the jury agreed and awarded ASI $3.7 million.

Now, it appears, company leaders and lawyers have gone to ground. The Tampa Bay Business Journal tried to call Southeast owner Paul Thomas Kolfenbach and other managers -- but to no avail. A call to the airline's New York lawyer went unanswered and unreturned.

It was the latest in a series of judgments against Southeast. Last March, the Business Journal reports a California company was awarded $4.62 million on its claim that Southeast had failed to make the payments on two of its aircraft.

Now, a fuel supplier is in court, demanding what's left of Southeast pay $150,000 already awarded in a settlement over unpaid fuel bills.

"I think we should push them into bankruptcy," ASI attorney Steve Wagner told the Business Journal last week. "That way, we could get a trustee to start following the (assets). I just have to find two other unsecured creditors, and I'm sure there are some creditors angry at Southeast."

FMI: www.flyseal.com