Avionics provider Innovative Systems and Services (IS&S) has announced that it has settled a lawsuit with Delta Air Lines (DL, Atlanta Hartsfield Jackson) over the termination of a contract to develop and deploy aftermarket cockpit upgrades. Under the terms of the settlement, Delta will pay IS&S USD7.75 million.
Delta signed a contract in March 2013 to upgrade its fleet of MD-88s and MD-90s with complete RNP systems integration, dual GPS navigation and cockpit avionics. Following a development period, the removal of legacy components and installation of new ones was expected to take less than six days, according to an IS&S press release at the time. The cost to upgrade the entire fleet - Delta has 116 MD-88s and sixty-five MD90-30s - came to USD325,000 per aircraft.
In a statement issued in October 2014, IS&S reported that Delta had "purported to terminate its contract… to provide a cockpit upgrade for its fleet of MD88 and MD90 aircraft." IS&S maintains that the contract represented USD62 million in backlog finance.
An MRO Network report from 2015 explains that Delta ended the contract "for cause" and admitted that it had not paid anything towards development costs. It contended that it was not required to do so and countered that it had lost millions of dollars preparing for the installations which were not delivered on time. "Delta admits that it terminated the agreements following a failed demonstration of IS&S's overdue, incomplete, uncertified and dysfunctional FMS," the airline said.
Both parties have agreed to dismiss their claims and counterclaims against one another.
