QUEENS, N.Y. (CN) - Jet America, a low-cost airline that advertised tickets for as low as $9, failed to lift off after FAA regulations shut it down and now it refuses to issue refunds to 10,000 people holding worthless tickets, a class action claims in state court.
Carrie Thorson says she bought a $69.20 ticket for a Jet America flight from Newark to Lansing, Mich. But one day after the company began its ad campaign, the FAA challenged Jet America's claim that it was a "public charter" or "indirect air carrier," according to the complaint. As a result, Jet America had to purchase slots on the runway to Newark, which Thorson says they did not have and could not afford.
Thorson says the start-up airline sold 20,000 tickets and chalked up millions of dollars in revenue in its first few days. "Two weeks later, Jet America canceled all flights," she says. Now the FAA enforcement has forced the company to suspend operations indefinitely.
Thorson says more than 10,000 class members are holding worthless tickets and Air America is not issuing refunds.
Also named as defendants are World Satellite Television News, which Thorson says launched the marketing blitz that created the short-lived success, but did not reveal the regulation problems.
The lead defendant is Sun America dba Jet America.
Individual defendants include Jet America Chairman Steven Schoen, CEO John Weikle, VP of Operations Brian Burling, World Satellite Television News President Brian Glazer, and unnamed investors and owners in Jet America.
Thorson demands damages for consumer fraud and unjust enrichment.
The class is represented by Mark Marino.
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