Another regional airline declares bankruptcy, gets sued
The budget airline filed for bankruptcy at the end of 2024.
Two days before the first day of 2025, budget airline Silver Airways announced that it was bankrupt and would be filing for protection in the U.S. Bankruptcy Court for the Southern District of Florida.
The Hollywood-based regional airline had found a market flying to domestic destinations like Key West and Tampa as well as the Bahamas, Puerto Rico and the Dominican Republic in the Caribbean.
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Revoked gate slots and looming lawsuit: where Silver Airways stands now
Amid dropping sales and the rising cost of operations, Silver had racked up more than $500 million in debt and had started to lose airport gate slots over unpaid fees.
"We anticipate completing this process by the first quarter of 2025, emerging stronger and ready to continue serving you with the same dedication we've upheld for over 13 years," the airline said in a statement at the time.
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By mid-January, the British overseas territory of Anguilla revoked Silver's ability to fly into Clayton J. Lloyd International Airport (AXA) over non-payment of nearly $104,000 in airport fees. The airline also faced eviction from its hub at Fort Lauderdale-Hollywood International Airport (FLL).
Most recently, the City of Tallahassee in north-central Florida has filed a motion against Silver on behalf of Tallahassee International Airport (TLH).
Related: Bankrupt airline strands passengers with canceled flights
'Subject to pay for things such as use of the runways and terminal facilities'
As first reported by aviation website View From The Wing, the complaint has to do with the passenger facility charges (PFCs) that the airline is required to charge passengers — according to the complaint, Silver has not been transferring these fees to the airport.
"Silver pays for use of the Airport’s facilities and is subject to the requirement to pay for things such as use of the runways and terminal facilities," the motion reads.
Similar complaints have also been filed by airports in San Juan, Tampa and Key West. The government of Anguilla said that Silver ran up debts of over $103,000 USD before it revoked its permission to fly into the country. The airline has since ceased operations; a number of passengers with tickets to or off the island reported scrambling to get their tickets refunded and find alternative flights on other airlines. Shutterstock
Tallahassee is asking the bankruptcy court overseeing Silver’s case to mandate the airline to create a separate bank account for funds generated through those charges and prove that they are being regularly transferred to the airport to make a dent in what is owed rather than them being spent on something else.
"The airport is generally supportive of the debtors’ efforts to reorganize and the relief sought in the Motions," it reads. "However, given the magnitude of the PFCs collected on behalf of the airport individually and of airports as a whole, and the risk of future disputes should there occur a default that implicates cash collateral, the airport hereby requests that [the court mandate the above]."
Neither Silver nor the bankruptcy court have publicly commented on the filings. As the airport and lessor complaints mount, the airline faces an uphill battle for getting out of bankruptcy without the brand recognition of a competing carrier like Spirit Airlines (SAVE) .
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