Air Charter Dispute Pits Former Partners

Call it Pinnacle Air, call it Jetride.

Call it Aspen-Jetride.

Or call it a big mess.

The private air charter service launched in 2002 by the Pinnacle Group — then made up of Tim Graham, Robert Thornton, Bill Schwyhart and the late J.B. Hunt — shut down on Nov. 7 as a casualty of litigation and lack of operating funds.

The Pinnacle Group split in August 2007, with Graham and Johnelle Hunt retaining the name and Thornton and Schwyhart forming Pinnacle Investments. There was some dividing of projects, with Hunt and Graham retaining ownership in the Promenade, and Thornton and Schwyhart taking over Pinnacle Air.

More than a year later, though, Hunt and Graham are still on the hook for around $30 million in debt liabilities at Pinnacle Air, which became Jetride in early 2007 after closing a $41 million deal to acquire the Columbus, Ohio, charter and its 20 or so planes.

The failure to resolve the agreed-upon divestiture of Hunt and Graham has sparked lawsuits and counterclaims among the former partners. They do all seem to agree on one thing, though: the bad guy is Chicago billionaire bond trader John Calamos.

All four principles now have lawsuits pending against Calamos, who became the two-thirds majority owner in Pinnacle-Jetride on Dec. 5, 2007, in a complex deal that was to release Hunt and Graham from the company’s debts and allow Pinnacle-Jetride to acquire the assets of Aspen Executive Air.

Calamos founded AEX, a retail charter service that allows members to prepay for jet services, through one of his private equity companies. Lawsuits filed by Hunt and Graham on July 31 and by Schwyhart and Thornton on Nov. 17 note that AEX “continually lost money” had $30 million in judgments against it by creditors in 2006.

According to the investment agreement, Calamos was to pay Schwyhart and Thornton $7.5 million for Pinnacle-Jetride, and they would use part of that money to purchase the post-bankruptcy assets of AEX. Calamos was then, as majority owner, to use his considerable wealth to arrange refinancing for the debt on 19 airplanes totaling $110 million. Hunt and Graham were to be relieved of their obligations and Thornton and Schwyhart were to be liable for no more than $15 million. The refinancing never happened by a March 6 deadline, spurring Hunt and Graham to file suit against their former partners and Calamos on July 31.

According the lawsuit against Calamos by Schwyhart and Thornton, their liabilities currently are more than $70 million, and there is now no operating income to service the debt after the company was shut down by Calamos on Nov. 7.

Schwyhart and Thornton allege Calamos stopped them from consummating the required refinancing, and that he always intended to defraud them by getting them to save AEX while he did nothing to assume debt held by Pinnacle-Jetride.

Calamos, who has retained the Rose Law Firm of Little Rock, filed motions to dismiss the complaints on Nov. 19. He has had a rough year in the market. Shares in Calamos Asset Management are down around 90 percent year-to-date, and his personal stock holdings in the company have lost around $2.5 billion in value.