Eclipse Position-holder Sues for Deposit Refund

Business Jet Traveler » August 2008
Friday, August 1, 2008 - 5:00am

Geiger Excavating has sued Eclipse Aviation, seeking refund of a $150,000 deposit for an Eclipse 500 VLJ, plus pre-judgment interest and the cost of taking the case to court. Jay Geiger, president of Geiger Excavating of Fort Wayne, Ind., signed a deposit agreement for the aircraft in October 2000. According to Geiger, before April this year, Eclipse said it would deliver the jet in October or November 2008, but on April 11, Eclipse told him that if he didn't pay $773,762 within a week, he would be in default of the deposit agreement and would forfeit the $150,000. According to the complaint, "Eclipse's demand was based on an anticipated delivery date in September 2008," and the company refused to adjust the final payment date to reflect the previously discussed October/November delivery. Eclipse also refused to refund the deposit. The complaint accuses the manufacturer of material breach of the deposit agreement and cites a provision in it that allows cancellation and refund "if FAA Part 23 certification of the Eclipse 500 jet occurs after June 30, 2004." An Eclipse spokeswoman said that the company does not comment on lawsuits.

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““CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. More good news is released when CEOs are back at work, and CEOs appear not to leave headquarters at all if a firm has adverse news to disclose. When CEOs are away from the office, stock prices behave quietly with sharply lower volatility. Volatility increases immediately when CEOs return to work.” —David Yermack, a New York University finance professor, whose recently released study shows a correlation between when CEOs take their private jets on vacation and movements in their companies’ stock price ”

-David Yermack