Two Venezuelan businessmen who were once convicted in the United States as unregistered agents of the late Hugo Chávez achieved a significant victory in a Miami court in 2020 in a bitter fight for control of the largest private airline in the South American country.
Although Avior Airlines has largely struggled due to U.S. sanctions and the coronavirus pandemic, investors are hopeful of recovering at least some of their assets, including a regional airline in neighboring Colombia, as reported by Joshua Goodman in an article for AP in 2020.
A Miami circuit judge dismissed a lawsuit from Jorge Añez, who alleged that his Florida-based partners had overcharged Avior for parts and services.
Judge Michael Hanzman determined that Añez lacked the authority to represent Avior, stating that there was overwhelming evidence he cooked the company’s books and formed an “illegitimate board of friends” to seize the struggling airline.
In ruling on the previously unreported lawsuit, he found that Añez had lied during his testimony and sought to use the U.S. legal system to perpetrate a “fraud.”
“Mr. Añez’s claim of 100% ownership of Avior is a complete fabrication, smelling of a late occurrence and was invented only after … a dispute over Avior’s operations,” the judge wrote.
Neither Añez, his lawyer, nor Avior’s president, Juan Bracamonte, responded to repeated requests for comment via email and phone.
The partner Añez tried to oust is an investment group including Carlos Kauffmann and Moisés Maionica. Both men were sentenced in 2008 to over one year in a federal prison in the United States for their role in a political scandal involving a suitcase containing $800,000 in cash sent to Argentina aboard a Venezuelan government plane.
The two Venezuelan businessmen claimed they had been sent by the intelligence agency of then-President Chávez to Miami to offer secret money to an FBI informant to keep quiet about the cash shipment, which was allegedly aimed at financing former President Cristina Fernández de Kirchner’s campaign.
Upon serving their sentences, both men remained in the United States and resumed their careers.
In 2010, they paid $5 million for a 50% stake in Avior and its affiliates, helping to transform it from a nearly bankrupt airline with one airplane to one that serves routes in Venezuela, as well as Miami and Latin America.
As foreign carriers withdrew from Venezuela due to payment disputes with socialist President Nicolás Maduro’s government, Chávez’s successor, Avior managed to fill the gap for a while, driven by heavily subsidized jet fuel, a highly favorable exchange rate for its dollar ticket sales, and unmet demand from the wealthiest Venezuelans who could still afford to travel.
However, as the United States imposed tough sanctions on Venezuela, the airline has once again faced difficult times.
In 2019, it lost its profitable route to Miami when the U.S. imposed a flight ban on Venezuelan airlines in its attempt to oust Maduro from power. It has also been blacklisted by European regulators due to safety issues. Meanwhile, the coronavirus pandemic grounded its fleet of 26 planes for months.
The company’s most valuable asset, an Airbus 340-300, was handed over to Maduro’s government to pay off old debts and fees, according to Kauffmann. This summer of 2020, the same aircraft, whose tail number changed and is now operated by the state airline Conviasa, flew from Caracas to Tehran, according to flight tracking records.
According to the judge’s order, relations between Añez and his partners began to deteriorate in late 2018. A few weeks later, both parties agreed to part ways, with Añez agreeing to buy the other half of the airline he did not own for $37.5 million.
However, the deal was never executed and, instead, Añez maneuvered to appoint an “illegitimate board” composed of his son and his lifelong lawyer, according to the judge’s order. He also filed the Miami lawsuit against his partners, accusing them of using a company registered in Florida that they also owned to overcharge the airline several million dollars for parts, supplies, and maintenance.
In his order, Judge Hanzman did not determine the merits of Avior’s underlying claims, only whether Añez, as the alleged 100% shareholder of the airline, had the authority to initiate legal proceedings.
He found that Añez, in his testimony, attempted to nullify the existence of a company ledger that listed Miami investors as shareholders and replaced it, after filing his lawsuit, with a fake ledger excluding his partners.
“Mr. Añez’s testimony is emblematic of a contempt for the truth and a willingness to commit perjury and not present evidence in a credible manner,” the judge wrote.
Kauffmann stated that even though he and Maionica have tried to move past their past, Añez thought that with his lawsuit he could pressure them into selling their shares and taking complete control of the company for almost nothing.
“He thought that because of our backgrounds, we would be afraid to defend ourselves in U.S. courts and that it would be a disadvantage,” Kauffmann told the AP.
The two parties are also locked in parallel arbitration in the International Chamber of Commerce.
Kauffmann admits there’s little worth fighting for and that recovering the company in Venezuela is a lost cause while Maduro remains in power. Still, emboldened by the Miami ruling, he hopes to use the decision to salvage whatever he can from Avior’s investment in neighboring Colombia, where it operates a regional airline, Gran Colombia de Aviación, out of the city of Cali.