(Reuters) — AerCap, the world’s largest aircraft lessor, said on Monday it was unlikely to recover some losses from insurers on jets stranded in Russia, as the lessor took its fight for redress to London’s High Court.
More than 400 planes, worth nearly $10 billion, are stuck in Russia after Western countries imposed sanctions on the country over the war in Ukraine and Russian lessees failed to return the jets.
Insurers are clamoring for payouts, arguing in part that there has been no physical loss of the plane yet, that the jets and engines are no longer under lease and that Western sanctions prevent them from providing cover.
Dublin-based AerCap said it was out of pocket to a “colossal”
; degree and, along with at least four peers, has filed a lawsuit that hinges on whether the alleged loss of the aircraft triggered war risk insurance, which has payout limits or all-risk policies with no cap.AerCap, the largest plaintiff, is suing insurers such as American International Group Inc. and Lloyd’s Insurance Co. of $3.5 billion due to the loss of 116 aircraft and 23 engines under its all-risk insurance. Alternatively, it is seeking $1.2 billion under its policy for war risks, court documents show.
AerCap, Dubai Aerospace Enterprise, Merx Aviation, KDAC Aviation Finance and Falcon allege they terminated Russian leases in line with sanctions and unsuccessfully demanded the return of aircraft and engines, court filings show.
DAE and Falcon are suing 11 insurers, including Lloyd’s of London, AIG, Chubb Ltd. and Swiss Re over 21 aircraft and equipment valued at $900 million under all-risk insurance, or just under $800 million under war risk limits.
Merx is seeking more than $255 million for the alleged loss of six planes and their engines and records, while KDAC is suing for $21.5 million for the loss of one jet, court filings show.
Judge Christopher Butcher said Monday that the five landlords’ cases should be heard together — although the inclusion of Merx and KDAC will continue to be reviewed — in what AerCap’s lawyers described as a “mega-trial” expected to begin in October 2024.
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