ARC NEWS
Comair suit adds to Boeing's Max legal woes
February 15, 2023
South African company Comair Limited, which ceased airline operations last year, has filed a lawsuit against Boeing in US federal court, seeking $83 million in damages and accusing the airframer of fraud and breach of contract related to a deal for eight 737 Max jets. Comair, which moved to cancel its Max order after two fatal crashes led regulators around the world to ground the aircraft for safety reviews, accuses Boeing of having "refused to return the advanced deposits on the seven aircraft it never delivered". It adds in its 6 February filing to a US district court in Seattle that it had "paid Boeing more than $45 million in advanced payments on seven 737 Max aircraft and full payment on the one 737 Max aircraft it received", and argues: "Comair suffered additional damages as a result of the grounding of its 737 Max for a total loss of more than $83 million." Boeing declined to comment. Comair began liquidating its assets in June 2022, after shuttering operations at the end of May. It had been conducting franchise services on behalf of British Airways and low-cost carrier Kulula. Boeing admitted to "conspiring to defraud the United States" as part of a January 2021 deferred prosecution agreement with the US Department of Justice. This pertained to a criminal charge accusing the airframer of defrauding the Federal Aviation Administration during safety certification of the Max. The DOJ in its statement on the deal said Boeing had admitted to "deception" of the FAA regarding the Max's Maneuvering Characteristics Augmentation System (MCAS) implicated in the two accidents. Boeing agreed to meet certain conditions in exchange for immunity from criminal prosecution. Comair has filed a civil lawsuit against the airframer. The Comair suit joins other cases related to Boeing's certification of the Max with the FAA and the fatal crashes. The prospect of criminal charges resurfaced in October 2022 when US district judge Reed O'Connor of the Northern District of Texas ruled that Boeing had through deception of the FAA "directly and proximately harmed" the 346 people who died in the two crashes. Those people and their families could therefore legally be considered "crime victims", O'Connor ruled. A ruling published by O'Connor on 9 February, however, states that while the DOJ violated crime victims' rights law in negotiating a plea deal with Boeing, his district court lacks the "statutory authority to supervise, or substantively review and reject" that federal immunity deal. "Boeing's crime may properly be considered the deadliest corporate crime in US history," O'Connor states in the ruling, adding that Congress may be the appropriate venue to address the DOJ's immunity deal. "This court has immense sympathy for the victims and loved ones of those who died in the tragic plane crashes resulting from Boeing's criminal conspiracy," adds O'Connor. The DOJ in court filings opposes attempts to void the deferred prosecution agreement with Boeing, stating that it "would impose serious hardships on the parties and the many victims who have received compensation". Paul Cassell, the attorney representing crash victims' relatives, is arguing felony charges against Boeing on their behalf. The relatives plan to appeal their case to the US Fifth Circuit court of appeals, Cassell says, arguing that the DOJ violated crime victims' rights by not including the relatives during the department's negotiations with Boeing "We are optimistic our appeal will vindicate the families' rights in this case and ensure that never again are deals like this one reached secretly and without victim involvement," Cassell says. The DOJ had not opposed a ruling by O'Connor that ordered a Boeing representative to appear during an arraignment on 26 January. The airframer filed a not guilty plea against criminal charges during that court appearance. In response to O'Connor's ruling on 9 February, Boeing shared a statement it gave following the arraignment. "We are deeply sorry to all who lost loved ones on Lion Air Flight 610 and Ethiopian Flight 302," Boeing says. "We will never forget the lives lost in these accidents and their memory drives us every day to uphold our responsibility to all who depend on the safety of our products. We have made broad and deep changes across our company, and made changes to the design of the 737 Max to ensure that accidents like these never happen again. We also are committed to continuing to comply scrupulously with all of our obligations under the agreement we entered into with the Justice Department two years ago." Testimony at the 26 January hearing included a joint statement by the father, mother and twin sister of Andrea Manfredi, who died on the Lion Air flight. The statement referred to their refusal of a $5 million settlement offered to them by Boeing and accused the company of trying to avoid accountability. "We would happily not take a dollar from them if it meant the executives all going to jail for what they did," they said. O’Connor's ruling also denies requests by LOT Polish Airlines and Czech carrier Smartwings to be declared as crime victims in the felony case against Boeing. LOT had in October 2021 filed a separate civil lawsuit against Boeing in US district court in Seattle. The carrier accused the airframer of fraud and sought $250 million in damages related to revenue that it claimed was lost due to cancellations and disruptions to its fleet plan during the grounding of Max aircraft, along with the costs incurred while storing those grounded jets. The Polish airline stated that it had lease agreements for 14 Max aircraft by the time of the grounding in March 2019. Five had been delivered and could not be operated during the grounding. Smartwings also has an ongoing civil lawsuit against Boeing in US district court in Seattle, again accusing the airframer of fraud related to Max orders. The Czech airline in its June 2021 court filing states it had received seven Max jets as of March 2019 and was scheduled to receive dozens more through lease and purchase agreements in a shift to an all-Max fleet. The carrier is seeking "direct, incidental and consequential damages" from Boeing, including the refund of $833,332 given to the airframer as an advance payment. A jury trial in the Smartwings case is scheduled for 13 November and could take 10-14 days, a court order states. Smartwings has seven Max 8s in service and 11 more on order, fleets data shows, while LOT has seven Max 8 jets in service and four in storage.


​Lufthansa launches new fare to include carbon-offsetting costs
February 15, 2023
Lufthansa Group will provide customers with an option to pay more for certain flights operated by its airlines, under a new fare category which incorporates the cost of using sustainable aviation fuel (SAF) and carbon offsets into the ticket price.
The German airline group says its "Green Fares" will enable passengers to "offset" the carbon-dioxide emissions of their flights. The pricier tickets will include the costs associated with offsetting CO2 emissions, with 80% of the offsets coming from contributions to "high-quality climate protection projects" and 20% coming from the use of SAF, says Lufthansa. The fares will also offer additional status miles and a free rebooking option. Lufthansa has not specified how much more expensive the fares will be than regular tickets, but says they will be priced "according to the market", adding: "There is no standardised model for switching from a 'non-green' fare to a 'green fare'. The prices for these products are set according to supply and demand, as with other fares." The new fares will be available to purchase from 15 February on more than 730,000 flights operated within Europe, as well as to Algeria, Tunisia and Morocco, by Lufthansa, Austrian Airlines, Brussels Airlines, Swiss, Edelweiss, Eurowings Discover and Air Dolomiti. The fares can be booked via the airlines' websites and through the New Distribution Capability (NDC) platform. Lufthansa Group already allows passengers to purchase SAF and carbon offsets through the onboard wi-fi on connected flights, and has been trialling the new fares on certain routes. It says the decision to roll out the fare option on a wider scale was taken in response to "growing interest" in travelling more sustainably. "The Green Fares were already successfully tested last year for flights from Denmark, Sweden and Norway," states Lufthansa Group executive board member Harry Hohmeister. "Now we are consistently taking the next logical step and adding Green Fares to our well-known fare structure for flights throughout Europe and North Africa." Offsetting has been criticised by environmental campaigners, who argue that the only near-term way to cut carbon emissions from aviation is to reduce demand for flying. In April 2022, Dutch advertising watchdog Stichting Reclame Code issued a preliminary ruling against KLM in which it found the airline's "Be a hero, fly CO2Zero" advertising slogan to be misleading. In July, ClientEarth filed a lawsuit against KLM, arguing that the carrier's "Fly Responsibly" campaign was misleading. Johnny White, a lawyer for ClientEarth, said at the time: "When it comes to offsets claims, the law on misleading marketing needs to be enforced. Trying to reassure customers that a small payment for tree-planting or 'sustainable' fuel compensates for flight emissions undermines urgent climate action, is gravely misleading and, the claim argues, is misleading." KLM's then-chief executive Pieter Elbers had in May been challenged at an annual general meeting by a representative of climate action group Fossielvrij Netherlands, who threatened to join ClientEarth in pursuing legal action. Elbers argued in response that the airline was an industry leader when it came to reducing its emissions, including through the use of sustainable aviation fuels.


Airbus and Air NZ lead Christchurch hydrogen initiative
February 14, 2023
Airbus and Air New Zealand have teamed with Christchurch airport and three other hydrogen-focused businesses to launch a consortium that will support the commercial deployment of hydrogen-powered aircraft. The Hydrogen Consortium also includes green hydrogen development companies Fortescue Future Industries and Hiringa Energy, and hydrogen infrastructure developer Fabrum. The six companies involved will work together to design a “hydrogen ecosystem” for aviation in New Zealand, and will assess the supply chain, policy and regulatory settings required to promote the development of hydrogen-powered flight. "The consortium we are building brings together a number of pioneering partners with a common interest: to make hydrogen-powered aviation in New Zealand a reality," says Airbus’s vice-president of the ZEROe Ecosystem Karine Guernan. A second phase will focus on whether hydrogen-powered test flights can be held in New Zealand. Under its Mission NextGen Aircraft initiative, Air New Zealand has set of goal of flying a low-emissions commercial demonstrator aircraft from 2026. This would be ahead of plans to start replacing its De Havilland Canada Dash 8-Q300s with low-emissions aircraft from 2030. “To fly hydrogen-powered aircraft in New Zealand we will need an aviation ecosystem that can support it,” says the airline’s chief sustainability officer, Kiri Hannifin. “The Hydrogen Consortium brings together energy, aircraft, airline operator and airport expertise with the aim of bringing this to life.”


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