Private jet services provider JetSmarter was a subject of a long investigation by CNBC. Almost a dozen lawsuits and claims were filed by members for failing to deliver on promises. The Company has stated that it has at last reached a financial agreement with its members to settle all issues. When the firm began operations it boasted of valuation over $1 billion and had more than 8000 members but since then it has been subject to several lawsuits for failing to fulfill promise made to members who questioned its security procedures. The arbitration settlement is preliminary and subject to final approval in June in which around 10,000 of the firm’s current and previous members would be eligible to participate as class members.
The agreement covers all customers that were part of JetSmart’s member group between 5 Sept 2014 and 19 June 2018. As part of JetSmart’s arbitration project it will create a fund of $3 million for payment to members that are eligible for flight credits and free memberships.
During the discussion the firm denied all allegations leveled against it and presented facts to show that it has always complied with membership agreements as per law. It stated that it will go ahead and institute the settlement to move ahead and get rid of past baggage so members can be served as best as possible. But experts say that this settlement will not end the firm’s legal woes as lawsuits have been filed in multiple sates and some members’ attorneys have announced that they are pulling out of the settlement to pursue their lawsuits independently as they feel that this compensation will not cover their clients’ claims adequately.
But these lawsuits are likely to be challenged in court as membership agreement of JetSmart stated that all disputes with regard to services will be settled only through arbitration.