April 18, 2024
Honda alleges Jet It broke a Fleet Purchase Agreement (FPA) by reselling a newly delivered HondaJet and providing the OEM false and/or misleading information.
The saga between HondaJet operator Jet It and Honda Aircraft Company continues as the OEM filed a lawsuit against its customer earlier this week.
The lawsuit stems from an October 6, 2022, Fleet Purchase Agreement (FPA) between Honda Aircraft Company and Jet It. Both are based in Greensboro, North Carolina.
The FPA covered the purchase of three HondaJet HA-420 private jets.
The lawsuit was filed on December 27, 2022, with the U.S. District Court, Middle District of North Carolina.
However, the next day on December 28, 2022, a judge referred litigants to schedule a mediated settlement.
In its filing, Honda alleged Jet It violated the Fleet Purchase Agreement by reselling aircraft SN236.
“Jet It has materially breached the express and implied terms of the FPA in several respects, including, but not limited to, by reselling Aircraft SN 236 to a third party in violation of the FPA; and providing Honda Aircraft false and/or misleading information to induce Honda Aircraft to deliver Aircraft SN 236,” according to the lawsuit.
On October 14, Private Jet Card Comparisons reported Jet It planned to move to the Phenom 300 platform for its fractional program.
We then exclusively reported on a November 18 email letter from Jet It CEO Glenn Gonalez to shareowners slamming HondaJet, calling support and reliability as “shocking,” “disappointing,'” and “grossly inadequate.”
The email was in part to schedule sales calls to pitch the new Phenom 300 offering.
Honda’s lawsuit alleges, “In an apparent attempt to spin some kind of justification for its decision to diversify its fleet, Jet It issued several statements that contain defamatory and disparaging comments about Honda Aircraft and the HondaJet brand.”
Still, Honda asserts, “During this same approximate time period that Jet It issued these statements, Jet It continued affirmative efforts to acquire additional HondaJet aircraft.”
The lawsuit continues, “In addition to learning of Jet It’s defamatory and disparaging comments about Honda Aircraft and the HondaJet brand, Honda Aircraft also has discovered that Jet It has breached the provisions of the FPA governing the resale, use, and control of the aircraft contemplated to be sold by Honda Aircraft to Jet It under the FPA.”
According to the OEM, “FPA contains several provisions that require Jet It to use the HondaJet aircraft it purchases in connection with its own business operations, and which prohibit Jet It from reselling such aircraft in any way contrary to the terms of the FPA.”
However, the filing adds, “On or about November 23, 2022, Honda Aircraft and Jet It closed on the sale and delivery of the first aircraft pursuant to the FPA, HondaJet aircraft serial number 42000236/Aircraft SN 236.
“Prior to the delivery of Aircraft SN 236, Jet It provided Honda Aircraft a copy of a Management Agreement indicating that Aircraft SN 236 would not be used in connection with Jet It’s business and operations for at least one year as required by the FPA, but instead would be transferred to an individual third party who would have exclusive possession, command, and control of Aircraft SN 236.
“Honda Aircraft objected to the above Management Agreement on November 22, 2022, which was the day before the scheduled delivery of Aircraft SN 236. Following Honda Aircraft’s objection, Jet It provided Honda Aircraft a copy of a new and different Management Agreement indicating that Aircraft SN 236 would be made available for use by Jet It to conduct on-demand charter operations for a period of one year, in an apparent attempt to persuade Honda Aircraft that Jet It was in compliance with the FPA.
“Jet It provided Honda Aircraft a copy of this new and different Management Agreement in order to induce Honda Aircraft to accept this transaction and move forward with the closing and delivery of Aircraft SN 236.
“Since the closing and delivery of Aircraft SN 236, however, Honda Aircraft has received information causing it to believe that the new and different Management Agreement was a sham.
“Upon information and belief, the third-party owner and Jet It had no intention of allowing Jet It to use Aircraft SN 236 for on-demand charter operations or otherwise as stated in the new and updated Management Agreement, and instead submitted the revised Management Agreement to Honda Aircraft solely to induce and ensure the closing and delivery of the aircraft occurred as scheduled.”
The filing claims, “Jet It’s resale of Aircraft SN236 to a third party is a material breach of the FPA and deprives Honda Aircraft of its right to receive the benefits of the FPA.”
Honda told the court, “Given these issues and material breaches of the FPA, Honda Aircraft has informed Jet It that Honda Aircraft intends to terminate the FPA and that Honda Aircraft does not intend to deliver the remaining two aircraft contemplated under the FPA. Despite these issues and material breaches, however, Jet It contends that the FPA is not subject to termination and that Jet It is entitled to delivery of those remaining two aircraft.”
Jet It executives could not immediately be reached for comment.
