WASHINGTON (CN) – A decade-long contract dispute with Philippine Airlines ended unhappily for two business partners including John Sununu, the former chief of staff to President George H.W. Bush, since a federal judge found that the men lacked written promises to support their claims.
Chief U.S. District Judge Royce Lamberth tossed Sununu and Victor Frank’s claims that the airline owed them $520,000 for their efforts to resolve an aircraft-lease dispute with World Airways. The men sued the company for fraud, breach of contract and unjust enrichment.
Sununu and Frank argued that Philippine Airlines misrepresented the termination date for the aircraft leases to them, leaving the men unable to fulfill their obligations for a contractual “success fee.”
Even so, they claimed that the deal they brokered for the airline ultimately saved it $13 million. Philippine Airlines refused to acknowledge the savings, and instead claimed the men cost the company $2.8 million.
Though Lamberth agreed that Sununu and Frank were likely bamboozled by the airline, he threw out the men’s fraud, breach-of-contract and unjust-enrichment claims, stating that “because the airline ultimately had no obligation to pay, the facts surrounding this issue are not material to resolving the case.”
“The airline can rightly be accused of stinginess for enforcing the formalistic terms of the contract in spite of the plaintiffs’ earnest efforts on its behalf,” Lamberth wrote, adding that “PAL may have violated Sununu and Frank’s trust, but it did not violate the law.”
Lamberth said the men “seem to have done their best to serve their client, but they made a reckless bet by trusting PAL.
“They were accustomed to handshake deals in which personal relationships count for more than legal documents, so they made little effort to put their understandings with PAL on paper,” according to the 26-page ruling. “When they ran into a client who didn’t play by the same rules, they paid the price.”
“The lesson is one that should be taught in law and business schools across America: When in doubt, write it out,” Lamberth concluded.