Cirrus SF50 Vision Jet operator Verijet has been facing lawsuits from aircraft lessors, a finance company, and an early investor.
According to court records, Miami-based Verijet is facing multiple lawsuits. However, its founder and CEO says the future for the 2020 start-up is still bright.
The lawsuits are from aircraft owners who had leased their SF50 Vision Jets to the jet card and on-demand charter operator, a company that provides cash advances to merchants, and an early investor.
LS Leasing, LLC filed a lawsuit in the U.S. District Court for the Southern District of New York on Nov. 2, 2023, for failure to make lease payments on N32NS.
It alleges that after leasing the aircraft to Verijet in July, the operator missed the first three monthly payments of $30,000 each.
A certificate of default against the private jet operator was issued on Dec. 21.
Multiple lawsuits have been filed in the Miami-Dade County Superior Court.
A judgment of $305,056 for Capitals Air LLC against the private jet flight provider was levied on Oct. 23.
Vision Jet Services Inc. filed a lawsuit against Verijet on Oct. 20.
It alleges failure to make lease payments for July, August, September, and October totaling $154,000.
Additionally, the plaintiff says Cirrus Aircraft had terminated a maintenance agreement required by the lease.
A lawsuit by N28VJ, LLC was filed on Sept. 21.
It sought the immediate return of an SF50 jet leased to Verijet.
After missing lease payments in June, July, and August, it sent a letter of demand requesting the aircraft be grounded and returned to its owner.
Its lawsuit says Verijet “failed to do so and has continued to use the aircraft for its own purposes without paying its contractual rent to N28VJ.”
Another lawsuit was by Diverse Capital, LLC, which provides equipment asset-based financing and merchant cash advances.
It alleges it fronted Verijet cash for receivables.
Diverse allegedly paid Verijet $600,000 for $810,000 in future receivables
At the time of the filing, it alleged that Verijet still owed $297,000 for the principal and a default fee of $98,000.
It appears that the lawsuit was settled last September, with Verijet agreeing to pay $238,600.
A lawsuit by Slawek Family Holdings, Inc., an early investor in Verijet, was filed on Aug. 3.
The Slawek litigation accuses Verijet and its Founder, Richard Kane, of making “claims to (believed to) be false and were made with the intention of fraudulently inducing investors.”
The plaintiff also leased an aircraft to Verijet. It also alleges the operator is behind on payments.
In November, Verijet said it had raised $85 million in new financing from Solaino.
The announcement came along with news that Kane was returning as CEO.
A month earlier, Echostar veteran Michael Marcotte said he had taken the Chairman and CEO roles at Verijet.
A representative for Solaino responded via email to an inquiry made through its website.
He tells Private Jet Card Comparisons, “[I]t is not easy to respond to this without prejudice to (confidentiality agreements).”
He added, “Our company will invest the mentioned amount but pending to complete audits accounts referred to this movement/process, until the moment the investment is not concluded yet (sic).”
Reached this afternoon, Kane points to Marcotte as the root of the problems.
He says Marcotte’s brief tenure in the corner office was “like dropping a grenade into a swimming pool.”
Kane says Marcotte derailed ongoing negotiations with aircraft lessors.
Marcotte declined to comment.
Verijet was launched in 2020 using the Vision Jet from Cirrus Aircraft, a single-engine, very light jet.
It started by focusing on flights in Florida and the Southeast before expanding to the Western U.S., the Northeast, Texas, and Canada last June.
On his return as CEO, Kane said Verijet’s active fleet had gone from a height of 23 SF50s to seven as it sought to renegotiate leases.
In November, he told us he expected 14 grounded VLJs to fly by December.
Kane says there are currently three airplanes flying.
He expects to close the financing with Solaino by next week.
The plan, he says, is to use the funding to buy or lease the disputed aircraft and continue Verijet’s growth.
Its as-available jet card provides flyers with fixed hourly rates within regional primary service areas.
Kane said last year, Verijet had around 100 jet card customers.
Its jet cards start at 25 hours and entail a non-refundable deposit.
Hourly rates recently increased to $4,800, based on buying 25 hours. Still, it was relatively cheap pricing for short flights.
Last February, Verijet announced plans for a SPAC IPO, although it quickly unraveled.
Verijet was ranked as the 30th largest charter/fractional private jet operator in 2022.