Sport Pilot Talk

drseti wrote:I haven't heard if the lawsuit has even gone to court yet. Does anybody out there know?

The case never made it to court.

dstclair wrote:

drseti wrote:I haven't heard if the lawsuit has even gone to court yet. Does anybody out there know?

The case never made it to court.

It did make it to some kind of court, and it was quickly thrown out with prejudice.

drseti wrote:I cite,for example, a fuel exhaustion accident involving a pilot known to many on this board.

Just curious - what happened?

There's a whole thread around here somewhere about this. Short answer: headwinds stronger than forecast. The guy did a precautionary landing on a private strip, checkled his tanks, was quoted as saying he "thought" he had enough fuel to reach his destination , took off again, ran out of fuel and crashed on final approach.

rezaf_2000 wrote:Paul, I just happened to come across your excellent annual report documents in a different thread, and the description of the incident as you wrote in the 2013 report (resulting into the LLC reorganization). Very interesting story, and your conclusion in forming an LLC.

Just note that LLCs, especially if single-membered, are at the risk of veil piercing. This is as a result of a 2012 court ruling. I'm pretty sure you've seen the case before though. Also, this is an interesting idea on the topic.

An LLC does not protect anyone from negligence, fraud or liability or lower exposure when lending assets to others. Placing a plane in a single person LLC means nothing unless you are using it in trust and estate management.

drseti wrote:There's a whole thread around here somewhere about this. Short answer: headwinds stronger than forecast. The guy did a precautionary landing on a private strip, checkled his tanks, was quoted as saying he "thought" he had enough fuel to reach his destination , took off again, ran out of fuel and crashed on final approach.

I believe when he took back off he estimated 2-2.5 gallons total remaining in *both* tanks.

His flight was estimated to take six minutes...he didn't make it. Either the fuel level dropped below what the pickups in the tanks could drain, or he unported the tanks due to the attitude of the aircraft. In the CTSW there is about 1/2 gallon unusable fuel per side, so with the amount of fuel he had at takeoff he was looking at 1 to 1.5 gallons of usable fuel; FAR below VFR minimums.

The nut of the lawsuit was that the CTSW has a "deadly design defect" (actual words in the suit) where if fuel in both tanks is run to very low levels (below what would even be visible in the sight tube gauges) it's possible to starve the engine of fuel in spite of there technically being some amount of fuel in the tanks. This is basically the concept of "unusable fuel" and is common to nearly every aircraft design, not to mention covered by every competent CFI in primary training, so the suit was dismissed.

I wouldn't expect (or even want) protection against my own fraud or negligence. What I am hoping is that the LLC will provide a modicum of insulaton from the most frivolous of legal attacks.

My best protection is that I own the aircraft, tools, and equipment, and lease them to the LLC. So, if someone sues the LLC and wins, they end up owning an FBO with no assets. I'm hoping that will prove adequate disincentive to prevent (or at least, to discourage) litigation.

drseti wrote:I wouldn't expect (or even want) protection against my own fraud or negligence. What I am hoping is that the LLC will provide a modicum of insulaton from the most frivolous of legal attacks.

I think an LLC could provide some liability shield in the case of a business for business management claims, but you can always be named individually as pilot for events related to actual operations of the aircraft...so in that regard the LLC is not helpful. There are almost certainly good tax reasons for an LLC in the case of a business operation like yours.