AerCap Holdings NV subsidiaries alleged in a High Court lawsuit filed on May 17, which has now been made public, that cargo carrier Volga-Dnepr Airlines has failed to give back eight Boeing airplanes and continues to use them within Russia. This is even after AerCap pulled the plug on their leases in the days after Russia invaded Ukraine, the lessor said.
Volga-Dnepr representatives allegedly told AerCap that it was attempting to return the planes, but that it needed approval from Russian customs authorities, which they never got, according to the filing.
However, AerCap told the High Court that Volga-Dnepr has continued to use the planes in Russia while refusing to pay money owed on the contracts even though the lease contracts were dissolved in early March.
AerCap, represented through its Irish units in the lawsuit, said that Volga-Dnepr's subsidiaries AirBridgeCargo Airlines LLC and Atran LLC have seemingly attempted "the unilateral re-registration of the aircraft in Russia, contrary to international law."
The European Union, the U.S. and the U.K. started slapping sanctions on Russia as it invaded it neighbor in late February. This was around the same time that AerCap said it notified Volga-Dnepr that it would cancel its contracts. The sanctions prohibit anyone from providing Russia with aircraft materials or technology.
Russia has in response passed laws to keep foreign-leased aircraft in the country, with an estimated $13 billion worth of stranded aircraft, causing headaches for insurers who will likely be locked in legal disputes for years over liability claims.
Adina Vălean, the European commissioner for transport, confirmed in late April that the Russian government was allowing local airlines to continue using "foreign-owned aircraft without a valid certificate of airworthiness."
While AerCap noted that U.S., U.K. and EU sanctions against Russia might impair the airline's financial position, the leasing company has requested that the High Court order the airline to pay the £339 million, damages for breach of contract and legal fees.
A number of entities have sued Russian airlines and their financial backers in recent months because of sanctions against the country that have led to canceled contracts.
Fellow AerCap subsidiaries sued UniCredit for $46 million in the High Court in March, saying that the Italian bank was hiding behind U.K. sanctions imposed on Russia to not make outstanding payments on aircraft leases.
Similarly, Aircastle Ltd. — another international aircraft leasing company — sued UniCredit for $23.5 million in April for the same reasons.
A Volga-Dnepr representative declined to comment on Thursday.
Counsel and representatives for AerCap did not immediately respond to requests for comment on Thursday.
Celestial is represented by Rupert Allen and Francesca Ruddy of Fountain Court Chambers, instructed by Herbert Smith Freehills LLP.
Counsel information for the defendants was not immediately available on Thursday.
The case is Celestial Aviation Trading Ireland Ltd. and others v. Volga-Dnepr Logistics BV, case number CL-2022-000249, filed in the High Court of Justice of England and Wales.
--Editing by Joe Millis.
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