In Manhattan, US District Judge Lewis Liman ordered Volga-Dnepr Logistics to pay aircraft lessor BOC Aviation $406,2 million. Following Russia’s incursion of Ukraine in 2014, the Russian cargo airline was deemed liable for defaulting on leases for three Boeing 747-8 freighters operated by one of its subsidiaries, AirBridgeCargo.
A millionaire payment
Reuters reported on Wednesday that an American magistrate held AirBridgeCargo Airlines and its parent company Volga-Dnepr Logistics liable after BOC Aviation was unable to reclaim its three widebody aircraft.
AirBridgeCargo, according to BOC Aviation, went into default because it was unable to maintain the required reinsurance coverage. Since the Kremlin’s invasion of Ukraine last year, hundreds of aircraft have been stranded in Russia.
BOC Aviation had established, according to Judge Lewis Liman, that the Russian government had “effected a seizure” of the aircraft and engines by preventing them from being flown and operated outside Russia. In addition, he refuted AirBridgeCargo’s claims that neither party could have anticipated a default. It was unthinkable to land the aircraft outside of Russia, as the country had ordered their return.
According to information provided by ch-aviation, AirBridgeCargo operates a fleet of sixteen Boeing widebody aircraft. It is equipped with three 747-400ERFs, twelve B747-8Fs, and one 777-200F. According to ch-aviation, one of BOC Aviation’s 747s with AirBridgeCargo is registered as VQ-BFU. This aircraft is almost eight years old. The shipment occurred in November 2015.
More than 400 aircraft stranded in Russia
This week, it was reported that nearly $10 billion worth of aircraft continues to be stranded in Russia. Lessors are suing insurers over stranded aircraft.
The largest leasing company in the world, AerCap, is suing insurers including AIG and Lloyd’s Insurance Company for $3.5 billion over the loss of 116 aircraft and 23 engines. In addition, it claims $1.2 billion under its war risks insurance policy.
However, insurers attempt to evade payment. They assert that the aircraft has not yet been physically lost, that the jets and engines are no longer subject to a lease agreement, and that Western sanctions prevent them from providing insurance coverage. On Monday, Mark Howard, an attorney for AerCap, stated that it was inconceivable that the company could not recover some losses from insurers.
Dubai Aerospace Enterprise (DAE), Merx Aviation, KDAC Aviation Finance, and Falcon are additional lessors suing insurers. For instance, DAE and Falcon lost over 21 aircraft and $900 million worth of equipment. Merx Aviation is seeking more than $255 million for the loss of six aircraft and their engines, while KDAC is seeking $21.5 million for the loss of a single flight.
Soon, AirBridgeCargo will resume operations.
As previously reported, AirBridgeCargo intends to resume operations shortly. Following the invasion of Ukraine by Russian forces in March 2022, the company ceased all flights. AirBridgeCargo will not, however, utilize its previous fleet. Instead, RA-96103 will be assigned to an Ilyushin Il-96 aircraft. Before the invasion, AirBridgeCargo controlled over forty percent of the Russian air cargo market.