A North Carolina courtroom is set to become the latest battleground as Wheels Up sues FlyExclusive, marking the third venue for a legal fight that has stretched on for more than two and a half years and pits two aviation heavyweights against each other.

The private aviation company is seeking between $33.6 million and $37.5 million, plus interest, alleging breach of contract, fraudulent misrepresentation, unfair and deceptive trade practices, and unjust enrichment, among other claims.

Jurisdictional Detour Clears the Runway

The case was recently dismissed without prejudice by the New York State Supreme Court in Manhattan, which ruled in early December that it lacked jurisdiction. That decision cleared the way for Wheels Up to refile elsewhere.

Originally launched in July 2023 in the U.S. District Court for the Southern District of New York, the lawsuit reflected Wheels Up’s headquarters at the time. The company later relocated to Atlanta in February 2024, while FlyExclusive remains based in Kinston, North Carolina, making the Tar Heel State a natural new forum.

A Clash of Aviation Titans

The dispute brings together the fourth- and fifth-largest U.S. private jet operators, measured by charter and fractional flight hours. At its core lies a November 2021 agreement, struck when private aviation demand was soaring to record highs.

Inside the 2021 Guaranteed Rate Program

Under the deal, Wheels Up contracted FlyExclusive to provide aircraft for its members through what the industry calls a Guaranteed Rate Program (GRP).

At the time, Wheels Up — newly public and expanding aggressively — counted 11,375 active members by the end of the third quarter of 2021. Many were promised flights on 24 to 48 hours’ notice at capped hourly rates.

FlyExclusive, which launched its first membership program in 2020, had greater flexibility back then. With fewer guaranteed members, it could offer on-demand charter capacity to other operators. By the end of 2021, its fleet stood at 78 aircraft.

As part of the agreement, Wheels Up paid $37.5 million in deposits to ensure access to FlyExclusive jets. After a ramp-up period, 10 light jets and 10 midsize jets were to be dedicated to Wheels Up customers, with additional payments covering flights and related expenses.

Deal Collapses Ahead of Holiday Rush

The relationship unraveled just before the July 4, 2023 holiday weekend, when FlyExclusive abruptly terminated the agreement. The company cited material breaches, including past-due payments, and raised concerns about Wheels Up’s alleged financial instability.

At the time, bankruptcy rumors swirled around Wheels Up. A month later, Delta Air Lines led a $490 million rescue package, stabilizing the company.

In his termination notice, FlyExclusive Chairman Jim Segrave wrote that Wheels Up’s failure to pay amounts due for May and June constituted material breaches that were not cured within the required 10 business days.

Competing Narratives Over Payments

Wheels Up has forcefully rejected those claims. In its court filings, the company argued that holding its large cash deposit was itself the strongest assurance of payment.

“There is no better guarantee for payment of future services than holding another’s cash deposit that fully covers those services,” the filing states.

Wheels Up maintains it never defaulted on finalized bills and was never subject to bankruptcy or insolvency proceedings. The company also alleges FlyExclusive coerced a $300,000 payment after issuing the termination notice, covering flights booked by Wheels Up members over the July 4 holiday.

Emails, Contracts and Silence From Defendants

The 80-page complaint, now filed in North Carolina, includes an unredacted copy of the GRP agreement along with emails and correspondence exchanged before and after the deal collapsed. Together, they offer a rare look into high-stakes negotiations over aircraft access, cash flow and trust.

FlyExclusive declined to comment on the litigation.

A Wheels Up spokesperson echoed company policy: “We do not comment on potential or pending litigation,” adding that the firm will let its public court filings, including the newly filed North Carolina complaint, “speak for themselves.”

As Wheels Up sues FlyExclusive, the dispute now taxis toward its next phase — with millions of dollars, reputations, and the future of private aviation partnerships hanging in the balance.