Bloomberg News

B/E Aerospace, Airbus Win Dismissal of Suit by Leki Aviation (1)

June 18, 2013

B/E Aerospace Inc. (BEAV:US), a maker of cabin interiors for commercial and business aircraft, and Airbus SAS won dismissal of a lawsuit brought by Leki Aviation over a contract for distribution of oxygen-systems products.

Leki Aviation, a closely held distributor of aircraft parts, interiors and components, filed the suit in October in New York State Supreme Court in Manhattan, accusing Wellington, Florida-based B/E Aerospace of wrongful termination of a $250 million, five-year agreement to distribute B/E oxygen-systems products.

Leki, based in Kastrup, Denmark, accused B/E of making false and misleading statements to get Leki to accept a lower discount rate on B/E products so B/E could use the agreement as leverage in pricing sales to Airbus and its Satair unit, according to the complaint.

Justice O. Peter Sherwood dismissed the suit in a ruling dated June 14 and made public today, saying that either party was free to terminate the agreement early without penalty and that B/E wouldn’t be liable for any damages if the contract was terminated before it expired.

Effective Date

“It is unclear whether the parties bargained expressly for the event of a termination that is declared prior to the effective date of the contract,” Sherwood wrote. “However, it is clear that the notice of termination could be given at any time and that upon such notice, a period of transition would follow.”

The suit, which sought unspecified compensatory, consequential and punitive damages, also accused Toulouse, France-based Airbus and its Satair unit of interfering with the contract by forcing B/E to terminate the pact. Sherwood said agreements that can be terminated at will are only possible contracts and can’t support a claim for interference with existing pacts.

The case is Leki Aviation A/S v. B/E Aerospace, 653625/2012, New York State Supreme Court, New York County (Manhattan).

To contact the reporter on this story: Chris Dolmetsch in New York State Supreme Court at 8969 or cdolmetsch@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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Companies Mentioned

  • BEAV
    (B/E Aerospace Inc)
    • $88.75 USD
    • -1.59
    • -1.79%
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