WR Port Authority sues airline, seeking return of $361,714
By Ed Runyan
YOUNGSTOWN
The Western Reserve Port Authority on Wednesday authorized filing a lawsuit in Trumbull County Common Pleas Court against Aerodynamics Inc., the company that flew daily flights for a short time last summer to Chicago out of the Youngstown-Warren Regional Airport.
The board also approved hiring Atty. Peter Grinstein of Canfield to assist the authority’s in-house attorney, Dan Keating, with the suit, which was filed April 20.
“It is ADI’s policy not to comment on pending litigation,” said Mickey Bowman, senior vice president and chief operating officer for ADI, in a statement sent Wednesday night to The Vindicator. “However, the company is aware of the lawsuit and is considering its litigation strategy.”
The port authority contracted with ADI, which has offices in Cleveland and Kennesaw, Ga., to operate flights between Youngstown and Chicago O’Hare International Airport.
The service lasted from July 1 through late August, with the port authority paying ADI $361,714 as a revenue guarantee to ensure that ADI would be profitable during the start-up phase.
Two-thirds of the money was coming from a $780,000 U.S. Department of Transportation Small Community Air Service Development Program grant. An additional $420,000 was available through the hotel-motel taxes paid in Mahoning and Trumbull countes for a total of $1.2 million.
The lawsuit seeks to have the $361,714 back, arguing that ADI breached its contract with the port authority and committed fraud, negligent misrepresentation and fraudulent inducement.
The central failure of ADI was its false representations to the port authority both orally and in writing that it had an interline agreement with American Airlines and United Airlines. The agreement would have caused American and United to handle baggage for ADI and for ADI to handle baggage for American and United flights, according to the lawsuit.
Shortly after the service began, airport officials discovered that there was a problem with transfer of baggage between ADI, which was operating as Great Lakes Jet Express, and the two other airlines, the suit says.
Then airport officials learned there was no interline agreement, and ADI attempted to correct the problem but did not, the suit says.
The port authority announced Aug. 18 that it would no longer fund the service because of the interline problem.
Because of ADI’s interline-agreement fraud, the port authority paid $361,714 to ADI, the suit says.
Keating tried to negotiate a resolution of the issues prior to the suit being filed, but ADI’s attorney cut off all communication with the port authority in November, Keating said.