Another carrier for now bankrupt Direct Air in Myrtle Beach fined by federal regulators

dbryant@thesunnews.comOctober 2, 2012 

— A second carrier for now defunct Direct Air was fined Tuesday for abruptly canceling flights in March that left hundreds of vacationers and other travelers stranded.

The U.S. Department of Transportation fined Xtra Airways $300,000 for canceling flights less than 10 days before departure and not ensuring return flights for round-trip passengers as the DOT requires of such public charter flights. Xtra also violated the rules requiring that it be paid before operating public charter flights.

Xtra stopped flying charters for Direct Air on March 13 after Direct Air didn’t pay the carrier all the money it was owed for operating flights that departed on or after March 3, according to the U.S. Department of Transportation.

Xtra also had received late payments from Direct Air for several flights prior to March 3, which should have prompted Xtra to look into whether Direct Air was following the federal rules, the DOT’s Aviation Enforcement Office said. The DOT requires carriers to make a reasonable effort to ensure that the charter operators they fly for are obeying the federal rules.

Jon Wadsworth, Xtra’s chief financial officer, declined to comment Tuesday.

Flights for Direct Air stopped flying March 12, which left many travelers -- including golfers and vacationers along the Grand Strand -- scrambling to find other ways to get to their destinations.

“Airline passengers should not have to worry about last-minute charter flight cancellations or being stranded in the middle of their trips,” U.S. Transportation Secretary Ray LaHood said in a news release. “Our rules were put into place to protect passengers’ rights, and we will continue to take enforcement action against airlines and charter operators when they violate those rules.”

Xtra is the second of Direct Air’s eight carriers to be fined by the DOT for their roles in the canceled flights, with World Atlantic Airlines fined $180,000 in late July.

Another carrier for Direct Air, Florida-based Sky King, has filed for Chapter 11 bankruptcy reorganization, with its president telling the Lakeland Ledger that Direct Air’s demise led to the filing, saying Sky King was owed $1 million by the former Myrtle Beach-based carrier.

Direct Air filed for Chapter 11 bankruptcy reorganization just days after its flights suddenly stopped in March, but the case was quickly converted to Chapter 7 liquidation, meaning the end of the charter flight operator. The bankruptcy court continues to sort through the finances, and the DOT said Tuesday its investigation also is continuing.

Contact DAWN BRYANT at 626-0296 or at dbryant@thesunnews.com or follow her at Twitter.com/TSN_dawnbryant.

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