Shoreline Aviation, Inc. v. Sound Aircraft Flight Enterprises, Inc.
2:20-cv-02161
| E.D.N.Y | May 30, 2025Background
- Shoreline Aviation (Plaintiff) operated seaplane flights between East Hampton, NY, and Manhattan, partnered with SAS (run by Herbst) to book flights for a commission since 1993.
- SAS’s booking business transferred to Sound Aircraft Flight Enterprises (SAFE, owned by Herbst) after Herbst's divorce in 2017, with SAFE taking over the customer list and booking services.
- SAFE later sold a customer list (including Shoreline customers) to Blade Urban Air Mobility for $175,000, after which Shoreline terminated relations with SAFE.
- Shoreline alleged breach of contract, misappropriation, unfair competition, breach of fiduciary duty, and related claims against SAFE, Herbst, and (for some claims) Pilla, Herbst’s partner.
- Cross-motions for summary judgment were filed. Magistrate Judge Locke issued a Report & Recommendation (R&R), with both parties filing objections; District Judge Choudhury adjudicated the objections.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether oral contract between Shoreline & SAS (then SAFE) required exclusive booking & mailings | Oral contract required exclusive booking and mailings; course of performance shows this | No exclusivity; written agreements with merger clauses superseded oral one; only commission for bookings | Existence of oral contract confirmed; disputes of fact on exclusivity and coupon mailings preclude summary judgment |
| Whether reasonable notice of termination was required under oral contract | Reasonable notice required, shown by course of conduct and implied by law | Not required; no evidence in record or party agreement requiring reasonable notice | No implied or express requirement for reasonable notice; summary judgment for Defendants on this theory |
| Whether SAFE and Herbst breached fiduciary duty/faithless servant doctrine | SAFE & Herbst acted as fiduciaries, using confidential customer information against Shoreline | No fiduciary relationship; no mutual consent or agency; booking relationship only | Material dispute of fact on existence & breach of fiduciary duty; summary judgment denied for both sides |
| Whether sale/use of customer data to Blade constituted trade secret misappropriation and unfair competition | Data was Shoreline's trade secret, protected and sold in bad faith; unfair competition follows | Data was not Shoreline's secret—created by SAS/SAFE for multiple clients; no formal agreement of ownership | Genuine issues of fact; jury to decide if customer list was trade secret and if misappropriation/unfair competition occurred |
Key Cases Cited
- Anderson v. Liberty Lobby, 477 U.S. 242 (summary judgment standard—genuine issue of material fact required to proceed to jury)
- Winston v. Mediafare Entm’t Corp., 777 F.2d 78 (factors for whether an oral agreement is binding)
- Bank Julius Baer & Co., Ltd. v. Waxfield Ltd., 424 F.3d 278 (merger clauses only supersede prior agreements to the extent they conflict; parol evidence rule)