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UPDATE 1-Bombardier sued by Comerica over aircraft payments

Published 2016-01-27, 09:39 p/m
© Reuters. UPDATE 1-Bombardier sued by Comerica over aircraft payments
CMA
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(Adds Bombardier comment)
NEW YORK, Jan 27 (Reuters) - Bombardier Inc BBDb.TO was
sued on Wednesday for at least $10.1 million (C$14.2 million) by
a unit of Comerica (N:CMA) Inc CMA.N , after the Canadian aircraft
maker was unable to find buyers for four planes whose leases had
expired.
According to a complaint filed in the U.S. District Court in
Manhattan, Comerica Leasing Corp was the beneficiary under owner
trusts that had bought the planes from Bombardier, and then
leased them for 16-1/2 years to a predecessor of SkyWest Inc's
SKWY.O ExpressJet unit.
Comerica said Bombardier had guaranteed minimum residual
values for the CL-600 business jets, which were developed by the
former Canadair, and would make up shortfalls if it found no
buyers or received only low bids within 90 days after the leases
expired.
But after failing to find buyers during the 90-day period,
Montreal-based Bombardier breached its contractual obligations
by failing to make required payments to Comerica, the
Detroit-based bank unit said.
Comerica is seeking just over $2.5 million for each plane,
plus interest and legal fees.
A Bombardier spokeswoman said the company performed in
accordance with the contracts' terms, and the allegations in the
complaint are without merit.
The lawsuit was filed in Manhattan because the parties
agreed that the dispute could be resolved there, Comerica said.
Shares of Bombardier closed below C$1 on Wednesday,
reflecting a shortage of new aircraft orders.
The case is Comerica Leasing Corp v Bombardier Inc, U.S.
District Court, Southern District of New York, No. 16-00614.
($1 = C$1.407)

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