What's new at Carney?

You might say this story begins at the end. One day last August (2008), customers arriving at Carney Aviation's office were greeted with a new lock and a quickly-made sign on the door:

That's it. A lawyer showed up with a couple of pilots and a locksmith, and simply shut the place. One customer drove an hour to find out, by seeing that sign, that his schedule was invalid.

First, note that the action is a liquidation, not a foreclosure. The lawyer who closed the office represents the owner of Carney Aviation, who had simply decided it was time to convert his assets to cash. When you consider that those assets are airplanes and could be flown away if a miscreant had a bit of warning, it's understandable that the closure came suddenly.

Since then, people have been asking what will happen next. This site will attempt to post news as it appears. News doesn't come often, and there's not much of it. This is an un-blog. The newest stuff is at the end. If you have something to add, please share it. Inquiring minds want to know. But please include enough information to verify what you're adding.

The 26^th of August was a busy day at Carney. The owner's lawyer had a short time to secure the company's assets, and then try to figure out just what he had on his hands. The next day, his Stratford representative sent an email to the 47 members who had email addresses on file. That note made it abundantly clear that Carney Aviation was out of business forever.

That home page remained for another month, until the site was shut down because the server bill was past due. Therefore, any email to an address at carneyaviation.com cannot be answered because it will not be received, as of 30 Sept. 2008.

Carney Aviation managed two Tigers under lease, N4540L and N911DK. Those two airplanes are now available to qualified pilots through Blue Sky Flight School. Mike Becker and Mike Palazzo are the main flight instructors for this company. Other instructors you knew from Carney will probably also be approved to teach in Blue Sky airplanes.

N1084K, a Mooney that had once been a Carney plane but was taken off the flight line, is also available through Blue Sky. 's annual inspection is past due. The owner plans extensive refurbishment before the inspection, after which he intends to sell the airplane.

The simplest way for disenfranchised Carney customers to keep flying is to buy an airplane. As Ferris Bueller was once advised, "If you have the means, I highly recommend it." (As the Empress of France might have said, "Let them eat cake.") Aircraft sales are firmly in a buyer's market right now, so the time is certainly right. But that's not the profile of the typical Carney pilot.

The flying clubs have limited membership. There may or may not be openings at any given time.

Alison McKay's email indicated that Carney customers with money on account would be reimbursed "in due course." It's beginning to look as though due course will take a long time.

Virtually no Carney customers have a personal copy of their contract with the company. The most recent wording is available at this link. Although that contract specifies a maximum amount that may be retained on account, the custom for the past several years has been to allow unlimited accumulation of flying credit. Reasons for such exemptions included extended periods of poor flying weather and unavailability of aircraft because of unscheduled maintenance or overbooking. Customers have also been allowed to suspend operation for various reasons and "freeze" their accumulated flying credit until they can get back to flying again. So the practice over the past several years has been that the flying credit is an open account.

Contrary to the original email, customers who have asked Attorney Hudson about refunding their flying credit have been told that the company would resume operation "soon," and that accounts would be settled when things were back to normal. The timeline for this was expressed in terms of the "next several months."

After a few unsatisfactory communications with Carney's lawyer, some customers have filed complaints with the Connecticut Attorney General. This is the text of an email describing one such notification:

This may be worth passing on to former Carney members who are owed money from pre-paid flight time. Richard Blumenthal, Connecticut's Attorney General, has opened an investigation on the sudden closing and moving of assets of Carney Aviation. I would strongly suggest anyone who is owed money contact his office regarding this.

Anyone wishing to contact his office should refer to Public Inquiry #••••••. This has been assigned to the Consumer Protection Department within the Attorney General's Office. Phone #860-808-5400. They will suggest putting all complaints in writing.

The mailing address is;

Attorney General Richard Blumenthal
55 Elm Street
P.O. Box 120
Hartford CT 06141-0120
Attention: Public Inquiry

The Attorney General has a history of success in dealing with cases involving prepaid fees and gift certificates, where apparently thriving businesses have closed suddenly and have been unresponsive to customer claims.

On 13 September, eight Carney customers met to discuss some options. The meeting invitation had been sent to the same people to whom Attorney McKay wrote in the email above, and was forwarded to at least 29 others. Two of those present had already spoken at length with Carney's lawyer, about possibilities that included

They had both received the lawyer's preliminary estimates of the value of the company as a whole ($250,000) and of the value of individual aircraft. The aircraft values quoted were about 25% above what one could find on a popular estimator web site. (Primary link for Vref is here.)

Before that meeting, the man who organized it had entertained the thought of buying the Carney assets if he could assemble about 40 pilots willing to invest a few thousand dollars each. The small turnout indicated that this was not realistic, so the group discussed other possibilities. Discussion centered around equity flying clubs; either forming a new one or joining an existing one. If the group were to form a new club, they might be able to buy one of Carney's airplanes, or to buy a different airplane. It was agreed that the cost of refurbishing either N74079 or N1321R, together with the high asking prices, put these airplanes out of discussion. Finally, the consensus was to approach a local flying club whose charter allows expansion to add more airplanes. A representative approached them, but that club is not presently in a position that would favor such an expansion.

Bills that would normally be sent at the beginning of September were not sent. Carney's lawyer has not contacted any pilot who flew in August about money owed. He has also not contacted any customer who has money on account (flying credit). Pilots who have contacted Carney's lawyer about money on account have been told various things, but the common thread is: Carney Aviation will resume operation in the "next several months," and accounts will be settled at that time. Some pilots have detailed accounting of the money Carney owes them. Carney's lawyer has not commented to them about specific amounts of money.

It is not known what Carney's lawyer is doing about the Connecticut Attorney General's investigation. Carney Aviation is a Connecticut corporation, but the lawyer is in North Carolina. It is not known if Carney's bank accounts have been transferred out of state, as the aircraft were. One petitioner received this response from the Attorney General:

I very much appreciate your letter bringing your concerns and questions to my attention. My staff will review your letter and will contact you as soon as possible.

We hope to help address these issues, and will do everything possible within our legal authority to assist you.

Your inquiry, recorded as Public Inquiry #••••••, has been assigned to the Consumer Protection Department within the attorney general's office. The phone number for this department is (860) 808-5400.

Again, thank you for contacting my office. If you wish to provide any additional information relating to your letter, please refer to the Public Inquiry number indicated above.

Very truly yours,

Richard Blumenthal
Attorney General

Rumors about Warren Boege's health have run the gamut from "just fine" to "on his deathbed." None of these rumors have been substantiated. If you are interested in Mr. Boege's health, you can contact his wife by email.

Carney Aviation owes the City of Bridgeport several thousand dollars for unpaid rent and parking fees. The City Attorney instructed Carney to vacate the office at the airport by 15 September 2008. That deadline was extended to 15 October. The office is still occupied (19 October).

The Carney office telephone (203.377.4445) is still connected. If you call, you will hear a message that begins, "Hello. I'm unable to answer your call right now." This just means that the answering machine is full of messages and can't take any more.

In the past week, Carney's lawyer has been in touch with at least two interested parties, indicating that airplanes would be for sale "in a short time." He indicated an asking price for one that was several thousand dollars higher than Vref.

He has also said that "Carney will make fair settlements ... but we will need time and documentation," and indicated that Carney's manager was not authorized to waive the $600 maximum credit that may be carried on account. In private conversation, the manager is adamant that he had authority for all aspects of running the company.

Chris Hudson has informed a few interested parties that he no longer represents Carney Aviation or Warren Boege. It is understood that Alison McKay has also resigned from the case. Mr. Hudson has apprised the Connecticut Attorney General of the change. It is not known what progress, if any, has been made in the case.

- and his wife's email address has already been noted. It has also been pointed out that the Boeges do not respond to contact by email, snail mail, or telephone.

Part of the reason may well be due to Warren's poor health. There have been many rumors, some plausible and some ridiculous, about Warren's health. But there are some facts in a blog [1] that his wife published in December. In December 2008, Warren Boege fell twice, breaking his hip. He's been in the Maui Memorial Hospital.

Back in Connecticut, the City of Bridgeport has also been attempting to communicate with the Boeges, also without success. The airport manager has informed Mike Becker that he will soon be able to move the offices of the Blue Sky Flight School into the room that Carney still occupies. Right now, Blue Sky operates three Tigers and one Mooney 201. One of the Tigers was damaged in a November 2008 accident, and will be out of service until its left wing can be replaced. It has proven surprisingly difficult to find a left wing for a 1979 Tiger. If you know of a source, Mike would be glad to hear from you, either by telephone (203.260.0811) or email. [2]

Carney's Grummans are back on the market, all four of them. Here is contact information for the broker:

[2] The airplane was declared a total loss after several weeks' search when a replacement wing could not be found. [back]