Western Global Airlines (KD, Fort Myers Southwest Florida) failed to pay invoices totalling USD556,000 over three months in 2022, according to a lawsuit filed by multimodal logistics company Radiant Logistics.

As reported by FreightWaves, Radiant launched legal action against Western Global in March in the US District Court for the Western District of Washington, alleging that the airline failed to pay 41 invoices between September and November 2022. The case is DBA Distribution Services Inc v. Western Global Airlines Inc (case no: 2:2023cv00308).

DBA Distribution Services Inc (Distribution by Air) is a Radiant Logistics freight forwarding subsidiary that Western Global used to transport its shipments. In addition to the value of the invoices, Radiant is seeking around USD210,000 in interest, taking the total value of the lawsuit to approximately USD766,000. The parties have told presiding judge Tana Lin that mediation is the preferred outcome, but if that fails, the matter will go to trial in early 2024. In the meantime, Radiant has applied for a lien to be placed on aircraft parts belonging to Western Global that it has in its possession. Radiant argues that it has the right to sell the parts to recover some of the monies owed.

Separately, Western Global is also facing a class action from a group of employees who claim they overpaid for shares issued in 2020 via an employee stock ownership plan. The employees, via the ownership plan, borrowed from Western Global to fund the acquisition. Western Global issued USD400 million in junk bonds at 10% p.a. to raise the funds, leaving the company with a significant debt burden and heavily impacting the airline's stock valuation. The key beneficiaries of the stock sale were the Western Global founder and CEO, James (Jim) Neff and his family, who pocked over USD500 million.

Neff has further angered employees and creditors by recently buying USD110 million worth of Western Global debt at a discounted price of USD0.40 on the dollar and leaping to the front of the creditor's queue in the event of any insolvency. As reported in ch-aviation, an under-pressure Western Global Airlines is now considering a range of options, including filing for bankruptcy, as it deals with significant operational, financial, and legal challenges.