XTRA Airways (Fort Lauderdale International) no longer faces a potential USD50 million lawsuit after a group of businesses from Saipan and 21 Chinese tourists dropped their case without elaborating on the reasons, the Marianas Variety has reported.
The five local tourism-related businesses and 21 individual travellers had earlier accused XTRA Airways and its executives of racketeering related to short-lived operations to China from Saipan in 2017.
According to the original lawsuit, one of the plaintiffs, Dream Pacific Aviation Services Hong Kong Ltd., entered into a charter agreement with XTRA in March 2017 to operate one Boeing narrowbody between Saipan and destinations in China. The contract was later expanded to two aircraft and additional destinations in China. The remaining plaintiffs collaborated with Dream Pacific to provide lodging and food for the expected influx of tourists to Saipan.
XTRA Airways briefly operated from Saipan to both Nanjing and Tianjin between September 24 and November 4, 2017. It cancelled the services without prior warning after a mechanical failure on the B737-800s deployed on the route on November 4. It was never able to obtain the route authorities needed for flights out of Saipan to each of Changsha Huanghua, Shenzhen, and Wuhan which were also covered by the contract with Dream Pacific.
The plaintiffs alleged violations of the Racketeer Influenced and Corrupt Organizations Act, fraud, violations of the CNMI Consumer Protection/Unfair Competition Act, and negligence. Dream Pacific, in addition, sued XTRA Airways for breach of contract/interference with contract, unjust enrichment, and conversion.
Collectively, the plaintiffs asked the court to hold XTRA Airways liable to pay them USD50 million in punitive damages, plus other damages, attorney’s fees, and court costs.
The airline defended itself by saying that Dream Pacific had failed to pay for the chartered flights.
