I want to start by saying this is by far the BEST post I’ve had the opportunity to write for this site. The outcome of this situation is helping me have a bit more faith in the justice system, karma and the ability for a good man to prevail against absolute evil.
So, lets talk about how to steal an airplane in 7 Easy steps….
1. Find a nice, trusting guy who owns the plane you want to fly and who is frequently out of town on business.
2. Work out a deal where Nice Guy leases you his airplane.
3. Suggest to Nice Guy that he set up a corporation in another state to hold title to the plane.
4. Since Nice Guy is gone a lot he’s going to let you set up the corporation and handle the paperwork for him. He’ll tell you to set it up in his and his wife’s name. But never mind that detail. Just go ahead and set it up in your own. We’ll call it Wright Flight Aviation, well, because that’s its name. You’ll be keeping the books and filing all the necessary paperwork each year so Nice Guy never needs to know that not only did you not list him and his wife, you made yourself the sole officer and director.
5. With the new corporation in place, go ahead and set up a legal lease agreement on the plane. In return for the privilege of flying the airplane, you agree to pay the costs of maintenance, insurance, hangar fees and any necessary repairs. Have Nice Guy sign for the corporation so he thinks everything is set up right.
6. Now, you already have ANOTHER company set up that you are sole owner of. We’ll call that one Mach I Aviation. Now have (Mach I) paper a loan to (Wright Flight) for $150,000. Go ahead and sign the papers for both companies. Next you’ll create a second document. This one will be a Security Agreement from Wright Flight to Mach I. It will give an interest in the plane to your company (Mach I) in case the loan doesn’t get paid back. Again, go ahead and sign for both companies yourself. No reason to bother Nice Guy with the pesky little details is there?
7. When Wright Flight doesn’t pay the “loan” back (because the real officer of Wright Flight doesn’t even know about any loan) you can just go ahead and repossess the airplane and transfer registration to yourself.
Detour here – When Nice Guy finds out that you didn’t set up the corporation per his request, he amends the corporate papers with the state to correct your oversight. And when Nice Guy finds out that you damaged his plane and didn’t provide the insurance you were supposed to, he’s going to do the only thing he can. Cancel the lease and take back exclusive possession of his plane.
But that’s OK! Remember you still have that nice little loan agreement you created, the agreement Nice Guy airplane owner was never informed about? So just sit back for about 2 years. Right before you get ready to file bankruptcy you can just file papers that say Wright Flight never paid back Mach I. Then you can hire a guy to go and repossess the plane. Now that guy may think the paperwork doesn’t look right once Nice Guy talks to him and explains the situation. No fear. Have repo-man red tag the plane so Nice Guy can’t fly away in it. Now it can sit in a hangar for a year or two and neither one of you can use it.
Nice guy is then going to file a lawsuit in civil court to have the Loan Agreement and Security Agreement cancelled. That’s okay, just be quick on your feet and file a “Certificate of Repossession of Encumbered Aircraft” with the FAA. Now the fact you don’t actually HAVE possession of the plane is just a minor detail, feel free to ignore it. Since the FAA will assume that you actually have possession and that everything you’ve done up to this point WASN’T illegal they will just transfer that registration right on over to you no questions asked. Viola, you now own a shiny plane (on paper).
Just one problem.
When you enter into a 30 day restraining order that prevents ANYONE from attempting to repossess or convey title to the plane until a decision is made in the previously mentioned civil action AND agree that no one can operate, fly or move the plane without written consent of the other party AND agree to provide Wright Flight with documentation to substantiate the supposed security interest Mach I has in the plane you probably shouldn’t turn around and file Bankruptcy and list the plane as one of your assets (valued at $250,000).
Sadly, all of the above is exactly what happened to the beautiful Lancair IV-P, tail number N484E, owned by Nathan East. He’s been fighting for it ever since. Some of you will know who he is because of the plane, others will know him as the bass player with the radiant smile who has played with just about everyone imaginable. But at the heart of this situation he is, quite simply, another victim. He was taken advantage of and unabashedly stolen from. He’s had to spend way too much money, time and energy to reclaim his OWN plane.
Initially the bankruptcy court ruled against him. That’s a whole ‘nother Oprah there. Thankfully, the United States Bankruptcy Appellate Panel of the Ninth Circuit had a clue. You can read the ruling from them here. They reversed and remanded the original decision from the Bankruptcy Court and made it quite clear what this all meant.
I want to quote a portion of it here to save you some time. This comes from pages 9 & 10:
“Wright Flight opposed, and supported its opposition with a statement of genuine issues in a dispute, a request for judicial notice, and the declarations of both Nathan East and (attorney) Jeffrey Gersh. These documents essentially indicate that, among other things,
• The Aircraft Loan Agreement and the Security Agreement were invalid under Nevada and California Law
• Mach I’s purported security interest in the Aircraft was never properly perfected.
• The law did not permit a thief to have superior title to the true owner
• The Trustee stood in the shoes of the thief so the Trustee’s title could NOT be superior to the true owner, and
• It was not clear this matter should be heard at all since Riggs was not and likely never had been an officer or director of Mach I.”
Yes, you read all of that right. The agreements weren’t valid, he’s a thief and the Bankruptcy Trustee took his word for it in deciding that Dave Riggs had superior ownership over Nathan and the Trustee was WRONG. And there is evidence that Dave Riggs was never an officer or director of Mach I (also another story).
What I find horrendous is that it appears that Trustee was saying in the original ruling that because Mr. East had the right to monetary damages if he won the civil case he did NOT have the right to get the plane back and it should remain with the Bankruptcy court. They would then sell it, take their share and if anything was left over it could go to the creditors. I object. If the plane was his, and was stolen then he should get his plane back. Simple. If the trustee wants money so bad they need to get the Lancair Dave Riggs is currently flying (N360DR, owned by Whirly Bird Aviation Inc, in Nevada), the L-39 now owned by Nazarene Aviation Fellowship, the Hummer he drives and anything else he’s hidden.
That won’t happen I’m sure but at least the Appellate Court saw fit to clear the way for Mr. East to get his plane back.
The appellate paperwork goes on for a total of 22 pages and it’s truly an interesting and enlightening read. But in the end it boils down to this..Nathan East should be able to regain possession of his plane very soon.
I have not had the pleasure of meeting Nathan personally but I have learned enough about him in the course of investigating and discussing this case to know that he is a man of kindness and integrity. What he has had to go through, simply to be able to enjoy his own plane, that I’m sure he worked incredibly hard to be able to have, is a travesty. And while I can’t do anything to fix that or to make it right again (except cheer LOUDLY when he finally gets to move that plane out of the jail it’s in at Whiteman Airport now), I once again feel vindicated in starting this website, because someone somewhere will be looking to get involved with David Riggs one of these days and see this story and save themselves some heartache and a lot of money.
Incidents like this are the very reason I created AviationCriminal.com, to expose the truth and hopefully prevent this kind of travesty from ever happening again.
Here is the plane in question..currently sitting in jail. May she see the skies again very soon with her rightful owner.
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