Stricken Comair (South Africa) (CAW, Johannesburg O.R. Tambo) has been ordered to produce a witness in a case in which Boeing argues that the provisionally-liquidated carrier has failed to produce documented evidence to support its fraud and damages charges over the alleged breach of a 2013 contract to buy eight B737-8 MAX aircraft.
In an order partially granted to Boeing on November 6 on a motion to compel, Judge Ricardo S Martinez of the United States District Court, Western District of Washington, Seattle, instructed the witness to appear remotely for a deposition that must be completed by December 4. The judge ordered both sides to work together to avoid further court intervention.
This is the latest development in the ongoing court case [Case 2:23-CV-00176] in which Comair, under provisional administration, is suing Boeing for damages related to the botched deal that cost the carrier more than USD83 million and contributed to its financial woes - eventually resulting in its provisional liquidation on June 4, 2022.
The case was filed on February 6, 2023. According to court records, Comair agreed to search for electronically stored information (ESI) dating from January 1, 2013, to June 14, 2022. However, Boeing claimed that Comair had not produced any documents from before May 2018. It also expressed concern over the "small volume" of Comair's ESI production comprising 6,600 pages and fewer than 400 emails. Boeing further noted that more than half of the documents produced were public media articles, public reports, and contracts involving Boeing, which it argued were irrelevant to the case.
Boeing noted Comair's refusal to present witnesses for deposition in the US District Court. On March 21, 2024, the manufacturer served deposition notices for several former Comair executives, including former CEOs Erik Venter and Wrenelle Stander. Comair had argued that Boeing would need to serve subpoenas in South Africa to compel them to appear in the US. Comair had suggested remote depositions if the witnesses agreed to appear voluntarily but never provided dates, times, or locations.
The manufacturer argued that Comair had not explained the absence of critical negotiating documents, such as Comair's proposal to Boeing. Hardcopy files from Venter related to the Boeing account were missing and financial documents supporting Comair's damages calculation, which were initially available, were not produced.
Boeing asserted that it had exhausted all efforts to locate the missing data, including subpoenaing the law firm that handled Comair's liquidation, but received no response.
For its part, Comair referred to Boeing's requests as "discovery on discovery." It argued that Boeing had no evidence of Comair destroying or mishandling evidence other than the speculation of Boeing's counsel that more electronically stored information should exist.
Backstory to the case
In September 2013, Comair, British Airways franchisee, and Boeing signed a contract for eight B737 MAX aircraft. Comair had paid Boeing more than USD45 million in advance payments for seven of the aircraft, with full payment on the other received on February 26, 2019. Following the worldwide grounding of the type resulting from two fatal crashes, Comair, in February 2020, unilaterally terminated the contract. Boeing agreed to cancel the second and third deliveries. Comair rejected Boeing's attempt to deliver the fourth aircraft in February 2021. According to the airline, the manufacturer refused to return the advanced deposits, which worsened the carrier's financial position.
In May 2020, Comair filed for business rescue in South Africa. In February 2021, it sought recognition of its foreign proceedings against Boeing in the US Bankruptcy Court in New York to compel Boeing to produce documents related to the B737 MAX deal. In the meantime, the airline ceased operations in June 2022 and entered provisional liquidation.
As the statute of limitations on Comair's claim against Boeing in the New York Bankruptcy Court began to expire in early 2023, Comair filed a lawsuit in the Seattle District Court. The bankruptcy court eventually deferred to the district court to resolve the issues around document disclosures.
