On January 21, 2011, DeKalb Aviation LLC filed a six-count lawsuit against the City of DeKalb and Mark Biernacki, Tom Cleveland and Norma Guess as individuals in the U.S. Northern District Court, Western Division.
The lawsuit alleges, among other things, that:
On or about December 21, 2010, Cleveland, as part of the execution of the scheme to defraud, and following consultation with and approval by Biernacki, changed the locks at the FBO, locking DeKalb Aviation out of the premises. In taking the actions set forth in this paragraph, Cleveland and Biernacki were acting under color of law as Airport Manager of the Airport and City Manager of the City, respectively.
The lock-out was approved by Biernacki, as City Manager of the City, and executed by Cleveland, as Airport Manager of the Airport, without any court action, without any determination by any court or administrative agency that DeKalb Aviation was in breach of its lease as amended, and without the benefit of any court order purporting to terminate DeKalb Aviation’s leasehold interest or purporting to give the City or any of its agents the right to do what they did, and without any meaningful opportunity for DeKalb Aviation to be heard before a neutral decision-maker, and said lock-out constituted a deprivation of DeKalb Aviation’s property without due process of law.
The unconstitutional deprivation of DeKalb Aviation’s personal property and leasehold interest in the FBO without due process of law has damaged DeKalb Aviation in that it is preventing DeKalb Aviation from earning moneys that DeKalb Aviation would otherwise have earned in connection with the operation of the FBO from the sale of gasoline and fuel, the provision of aircraft maintenance, the provision of flight training, and the subleasing of space; it is depriving DeKalb Aviation of the value of its personal property; and it is preventing DeKalb Aviation from using its personal property in locations other than the Airport FBO.
The City of DeKalb announced its intent to file a counter suit against DeKalb Aviation, LLC. According to a City of DeKalb press release:
The City’s counterclaim will seek damages arising from DeKalb Aviation’s breach and default in its FBO contract with the City. “Last December, the City declared DeKalb Aviation in default due in part to unpaid rents and DeKalb Aviation’s failure to store and sell fuel as required under the contract,” said Michael Bersani of Hervas, Condon & Bersani, P.C., special counsel to the City. “Since the default declaration, according to City officials, the City has been unable to fully operate the airport, particularly the fueling operations, where the equipment and contracts needed to do so have been tied up by DeKalb Aviation. These revenue losses have been adding up which has forced the City to file suit,” Bersani said. In addition, the grant assurances that the City has with the FAA require the operation of a viable and accessible airport.
The City will be responding to DeKalb Aviation’s suit, which alleges that the City unreasonably seized DeKalb Aviation’s property, violated due process, and interfered with their business operations. Bersani said DeKalb Aviation’s allegations are meritless and the City defendants will seek dismissal of that suit. “This case is really about the City declaring DeKalb Aviation in breach because it was not operating the airport in a manner that met its obligations in the FBO contract. The City is mandated to run an airport. It took the steps necessary, and within the law, to do so,” Bersani concluded.
On January 26, 2011, DeKalb County Online filed a Freedom of Information Act request for all contracts between DeKalb Aviation, LLC and the City of DeKalb. The request was fulfilled on January 30, 2011. The FOIA response provided three contracts.
Assignment of Agreement (JA Air to DeKalb Aviation 11-3-08) DeKalb Aviation purchases all rights and obligations to a Full Fixed Operator’s contract and lease for the premises located at DeKalb Taylor Municipal Airport. This Assignment of Agreement was approved by the City of DeKalb as Resolution 08-91 on October 27, 2008 and signed by then acting-Mayor Kris Povlsen. According to the lawsuit, DeKalb Aviation paid JA Air the sum of $250,000.00, plus approximately $30,000.00 for aviation gasoline and jet fuel then in the underground storage tanks. The Assignment of Agreement was signed by Ed Kling for DeKalb Aviation, LLC.
DeKalb Aviation FBO Agreement 11-1-08 Pages 12-13 of this agreement relates to terms and conditions for default. Under item 25-c if the FBO defaults under the terms of the agreement, and the lease is terminated, the City of DeKalb has the right to enter the premises, take possession and to exercise any remedy permitted by law. This agreement was signed by Jeff Kohlert as CEO of DeKalb Aviation. Kohlert is also president of Fly America, Inc.*
Amendment to FBO Agreement with DeKalb Aviation (7-13-09) The Nov 1, 2008 FBO Agreement incorrectly identified DeKalb Aviation, LLC as DA, Inc. It also incorrectly identified Jeff Kohlert as CEO of DeKalb Aviation. This amendment corrects those mistaken identifications. It is signed by Edward Kling, administrative member; Mark Riggsby, administrative member; and Jeffrey Kohlert, managing director for DeKalb Aviation, LLC. Signatures for the City of DeKalb include Mayor Kris Povlsen and Steve Kapitan, City Clerk.
* From public meeting records available on the City of DeKalb’s website:
Page 232 of the agenda for the January 10, 2011 DeKalb City Council meeting includes the Specialized Aviation Service Operation (SASO) Agreement between the City of DeKalb and Fly America, Inc. This agreement was signed by Jeffrey Kohlert as CEO. It was approved by the City Council at that meeting. Alderman Dave Baker (6th Ward) cast the only vote against the agreement.
When the issue was being discussed as an action item Baker asked Kohlert, who was present, if he (Kohlert) was released from all legal ramifications related to DeKalb Aviation, LLC. Kohlert responded that he was not completely released. Baker then lobbied to delay consideration of the SASO agreement with Fly America, Inc., until any legal proceedings with DeKalb Aviation were finished. Mark Biernacki admonished Baker for bringing potential litigation up in public session and for having direct communication with Ed Kling of DeKalb Aviation, LLC.
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3 Comments
Well, score one for Baker for pointing out possible legal consequences. When one throws out dozens of darts, one of them is bound to hit the dartboard.
Well, the local soap opera titled “Biernacki and Company” keeps on rolling along with a new suspense just around the next corner.
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Well, it looks like the city of De Kalb must have plenty of money to hire outside attorneys to defend and to countersue. Even if the FBO did sign this agreement to allow the City to enter and to seize property without due process, such contracts are often held illegal in this state as contrary to the public interest. In other words, just because two parties sign a contract does not mean that all terms are legal, as, in certain cases, one cannot sign away one’s rights to basic Constitutional safeguards.