US aviation company Jet Midwest has launched legal proceedings against Rex - Regional Express (ZL, Wagga Wagga) in the New South Wales Supreme Court in Sydney, alleging that it stripped its aircraft for parts and sold the remaining airframes for scrap without paying for them, according to the Australian Financial Review.
The matter, Jet Midwest, Inc. v Regional Express Holdings Limited trading as Regional Express Airlines (case no: 2024/00264848), was mentioned before Justice James Stevenson during a directions hearing on September 13.
Jet Midwest, a Kansas-based aircraft MRO that sells, leases, and exchanges aircraft, engines, and their components, says in its court filing that in 2019 it sold Rex four Saab (Sweden) turboprops stored at Kingman Airport for USD2 million, against which Rex paid a USD200,000 deposit.
Citing Covid-19 related financial constraints, Rex requested an extension of payment timelines. But by June 2020, with no more funds forthcoming, Jet Midwest declared the contract void. Despite this, Jet Midwest alleges Rex retained a third party to remove the engines and propellers around October 2020 and scrap the airframes, with the assets and funds from scrapping later handed over to Rex. Jet Midwest is asking the court to award it USD7.2 million plus legal costs. Contacted by ch-aviation, Jet Midwest declined to comment on the matter.
Rex is now in administration and trying to find a new majority owner after an ill-fated decision to start B737-800 flights. Those services have now ended but the airline continues to operate turboprop flights with its fleet of twenty-two Saab 340Bs and thirty-five Saab 340B(Plus) types, although 25 of these aircraft are AOG because of a shortage of pilots and spare parts.
