Another describes Swift Air’s work on Saipan as ‘dog and pony show’
A former employee of Swift Air LLC testified in her deposition that Swift Air executive Boris Van Lier lied to Saipan Air Inc. about the status of two promised aircraft.
Another former staff of Swift Air also described in his deposition that their company’s work on Saipan was a “dog and pony show.”
Saipan Air subsequently learned that only $176,000 of the initial $900,000 that Saipan Air wire transferred was paid to International Lease Finance Corp. for the aircraft’s deposit.
These were some of the information Saipan Air Inc. disclosed in its opposition to a motion for summary judgment filed by defendants Van Lier, Donald A. Stukes, and Jeffrey Conry.
According to court records, the three were employees, officers, or advisers of Swift Air, an Arizona corporation. Conry was chief executive officer, Van Lier was director of operations, and Stukes was chief restructuring officer and also an employee of ASI Advisors LLC.
Saipan Air has filed a $50-million racketeering lawsuit against Van Lier, Stukes, and Conry for fraudulently inducing the company to transfer money and other assets to Swift Air.
In Saipan Air’s opposition to the motion, attorney Steven Pixley disclosed that Laurie LeRoux, a six-year employee of Swift Air who was employed by Swift Air during the relevant time period, occupied a cubicle adjacent to the offices of Van Lier and Conry.
Pixley said LeRoux testified at her deposition that from her cubicle she overheard Van Lier speaking with Saipan Air’s chief operating officer Adam Ferguson on numerous occasions.
Pixley said LeRoux testified that Van Lier lied to Ferguson about the status of the aircraft. For example, she stated that Van Lier lied when he told Ferguson that the two 757 aircraft were painted.
LeRoux also testified that Van Lier lied to Saipan Air about the availability of a 767 aircraft that had been promised to Saipan Air.
“At the time this airplane was promised to Saipan Air, it was under contract with EZ Jet and based at JFK Airport in New York,” said Pixley, citing LeRoux’s and Ferguson’s declarations.
Pixley said LeRoux testified that “I knew in my heart of hearts that what was going on was not right.”
Pixley said Shane Nail, a former employee at Swift Air in the maintenance department, testified in his deposition that he doubted whether Swift Air intended to perform the Saipan Air program.
The lawyer said Nail testified that there was “no effort at all regarding maintenance.”
Nail revealed that no maintenance manuals were prepared and that no parts were purchased for the 757 aircraft, which were to be used for the Saipan Air program.
Nail described Swift Air’s work on Saipan as a “dog and pony show.”
Pixley said Nail was also “extremely suspicious” of what he believed were kickbacks in the purchase of parts from a company in Miami, Florida, at exorbitant prices.
Pixley said Nail further testified that the 737DX, which was an integral part of Saipan Air’s program, may have been physically present in Phoenix in January 2012 but it was not in Phoenix or available for use in the Saipan Air program during the relevant time period.
Van Lier gave a presentation on Saipan on Jan. 11, 2012, to Saipan Air executives regarding Swift Air’s proposal to provide air services for Saipan Air.
Pixley said Jim Rogers, the owner of a 737-400 aircraft (“737DX”) which was promised by the defendants for Saipan Air’s program, told Conry and Van Lier that the aircraft could not be used in the Saipan Air program.
Pixley said Conry and Van Lier continued to represent to Saipan Air that this aircraft was available after May 15, 2012.
In addition, Pixley said, the defendants entered into a lease agreement with EZ Jet during the relevant time period for a 767 aircraft that was to be used by Saipan Air in its program.
Pixley said Van Lier and Conry falsely represented to Saipan Air that this airplane was available at the same time that they were attempting to obtain the $1.5 million loan from Saipan Air.
Pixley said the defendants failed to inform Saipan Air that they did not make the required deposits to ILFC and it was not until on May 15, 2012, that Saipan Air learned that the aircraft deposit was not made.
He said Conry and Van Lier apologized to Saipan Air regarding their failure to make the requisite deposits.
Pixley said on May 23, 2012, Conry pleaded with Ferguson for additional money by representing that additional funding for the Swift Air operations were forthcoming and that they would be able to meet the July 1, 2012, launch date for the Saipan Air program.
Based upon these representations, Pixley said, an additional $376,000 was sent to the defendants via wire transfer from Saipan.
As with the wire transfer, Pixley said that Nick Huska, then-chief financial officer of Swift Air, does not know how these funds were used.
Pixley said that on May 31, 2012, Conry phoned Ferguson several times, stating that they urgently needed a “bridge loan” in the amount of $1.5 million in order to perform their agreement with Saipan Air.
Pixley said Conry introduced Saipan Air to Stukes at this time. Stukes allegedly identified himself as a “financial advisor” affiliated with ASI advisors, but failed to disclose to Saipan Air that he was a minority owner of Swift Air.
Pixley said Stukes expressly represented to Saipan Air that the defendants would be able to perform the Saipan Air program if the $1.5 million was paid.
The lawyer said that, according to Stukes in his deposition, he “had no communication whatsoever” with Swift Air between January to April 2012 and that it was Conry who was running the company.
Pixley said Nick Huska, however, in his deposition stated that Stukes was actively managing financial matters for Swift Air during the entire relevant time period.
On Saipan Air’s fraud claim, Pixley said there exists both direct and circumstantial evidence sufficient for a reasonable trier of facts to conclude that the defendants did not intend to perform their promises.
As for Stuke’s role in the fraudulent scheme, Pixley said while the court at this stage of the proceedings does not normally weigh the credibility of witnesses, the only reasonable conclusion to be drawn from a review of the testimony of Husk vis a vis Stukes is that one of these witnesses committed perjury.
“This creates a genuine issue of fact as to Stuke’s involvement in this fraudulent scheme,” Pixley said.
On the unjust enrichment issue, Pixley pointed out that Conry and Van Lier were paid $300,000 and $240,000 to $250,000 per annum respectively, which was very high given the fact that Swift Air only operated two airplanes during the relevant time period.
The lawyer said Stukes received $295,000 from Swift Air in 2012.
On Racketeer Influenced and Corrupt Organization Act issue, Pixley said a review of Saipan Air’s evidence shows that there exists genuine issues of fact regarding the existence of an association-in-fact enterprise. He said Stukes and Conry have engaged in a pattern of fraudulent activities over the course of the past several years.