SkyValue Says It Wants to Return Airport’s $325,000
By Keith Benman, The Times, Munster, Ind.
May 3–The Gary/Chicago Airport Authority’s threat of pursuing a fraud lawsuit against the CEO of SkyValue airlines has both sides talking.
SkyValue CEO Darrell Richardson has called the airport and offered to negotiate a repayment plan for the $325,000 advance the airport gave his airline, according to airport director Chris Curry.
“The fact fraud charges were possible really got their attention,” Curry said.
On Tuesday, the airport authority authorized its lawyer, Patrick Lyp, to pursue the charges against Richardson. Lyp will hold off on filing a lawsuit if a payment plan can be worked out, Curry said.
Last Friday, SkyValue informed the airport and some 6,000 ticket holders it will cease all flights on Saturday. Airline officials cited stiff Chicago competition for bargain flyers, as well as weak summer demand, as reasons behind the shutdown.
The $325,000 was advanced out of airport marketing funds to the airline in mid-April in an attempt to keep it flying. Richardson in the letters requesting the payment said it would be paid back within days.
Richardson did not return a call from The Times on Wednesday seeking information on plans for paying the money back.
Curry said he did not know what effect SkyValue’s failed attempt to purchase three planes in March from a bankrupt airline might have on its ability to repay the money.
SkyValue’s failed attempt to buy the assets of Falcon Air Express Inc. resulted in a forfeiture of $720,000 by SkyValue, according to documents filed in Federal Bankruptcy Court for the Southern District of Florida.
It also led the court trustee to seek a $3.1 million civil contempt forfeiture against the airline and a Florida investor. The outcome of the trustee’s action could not be learned on Wednesday.
As of mid-April, SkyValue also owed $1.2 million to Xtra Airways, Curry said.
Xtra Airways is the Elko, Nev., company that leased a Boeing 737 and crew to SkyValue for its 10 weekly flights.
On Wednesday, Xtra Airways Operation Director Joshua Weinshank would not give the exact amount owed his company by SkyValue, but he confirmed it is “a substantial amount of money.”
He said Xtra Airways worked with SkyValue and the Gary airport to salvage the airline throughout the month of April.
“We thought it was an entirely viable proposition and were big supporters of it,” he said of the start-up airline. “We like the Gary area and certainly wanted it to be successful.”
Xtra Airways also has operated Casino Express and other flights out of the Gary airport.
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