In a decision issued on Friday, March 11, the federal district court denied Westchester County’s motion to dismiss Million Air’s claim that the county acted in bad faith regarding a stormwater system for Million Air’s leased premises. In particular, the court held that Million Air’s allegations in its complaint regarding the stormwater system sufficiently stated a claim for breach of the implied covenant of good faith and fair dealing found in Million Air’s lease with the county.

As the Court noted, Million Air alleges that the county “advanced multiple inconsistent and bad-faith positions” related to the stormwater system. The court held that these allegations state a viable claim for unlawful bad-faith conduct by the county. In particular, the county first told Million Air that it should
complete the original “Proposed Improvements” (i.e., renovations of the existing terminal and the building of a new hangar), and refrain from building a stormwater system until Million Air completed those improvements as well as the modified hangar.

According to the county, the stormwater system, once completed, would serve both the proposed improvements and the modified hangar together. But after Million Air followed the county’s directive and completed construction of the initial proposed improvements, the county reversed course and directed
Million Air to construct a stormwater system for the proposed improvements alone, as a condition to the county executing an amended lease approving the modified hangar.

Constructing the stormwater system for the completed proposed improvements has required Million Air to tear up portions of the completed construction, which has significantly disrupted Million Air’s business and has caused Million Air to incur millions of dollars in costs—costs that would not have been incurred with the county’s original instructions to complete the proposed improvements without a stormwater system. These allegations, the court agreed, support
Million Air’s claim that the county, acting in bad faith, deprived Million Air of the benefits of its lease with the county.

Although the court granted the county’s motion with respect to the contract claim, the denial of  the county’s motion to its claim of breach of the good faith could result in a multi-million damages award against the county. “We are gut-wrenched to think that we had to sue the county to provide the community with solutions to its long-term goals—less airplane noise by decreasing repositioning flights by over 1,000 flights per year, more high paying jobs, and work for our local unions and suppliers,” said Roger Woolsey, CEO of Million Air. “We hope this development in the case brings the County one step closer to unlocking
these much-needed benefits for so many who live in our community.” (Submitted)