28
GA
/ Vol. 5 / No. 2 / FEBRUARY 2013
Epic Aircraft
Epic LT single
turboprop aircraft
Epic Victory single
jet aircraft
Epic Elite twin
turbojet aircraft
Epic Aircraft, a general aviation
aircraft manufacturer in Bend,
Oregon offered three high
performance kit aircraft models
and was in the process of
developing two certified models
when it entered bankruptcy in late
2009. Just three years later, from
10 14 December 2012, the FAA
and the builders worked together
to complete certification on 5
Epic LT's and first flights were
completed on two of them with the
remaining to follow soon.
The company's woes started
back in June 2009 when the first
Future Aircraft
of a number of lawsuits was filed
against Epic when it was named as
defendant in a lawsuit filed with the
United States district court by Blue
Sky AvGroup, an Epic customer that
had an aircraft under construction
at the build center. The lawsuit
alleged that Epic failed to meet its
contractual obligations in completing
an aircraft for Blue Sky. A request for
Epic to be placed under receivership
was opposed by the company.
In late June that year Epic
dramatically scaled back its
operations and laid off all but 15
of its employees. The lay-offs
primarily affected the aircraft build
center, where customers worked
on their own kits, in its Bend,
Oregon plant and were attributed to
"economic issues". The company
indicated it was working to rectify
the situation and that customers still
had access to their aircraft under
construction.
Epic was also named as
plaintiff in July 2009 in a lawsuit
against engine maker Williams
International, claiming that the
engine maker defaulted on a
contract to supply engines for the
Epic Victory program.
On August 8, 2009, the
company's landlord ER1 LLC
posted a notice indicating that
they had "taken possession of the
premises" claiming "a possessory
lien on the personal property" due to
Epic being in default on its lease.
By early September, 2009,
several additional lawsuits had been
filed against Epic. These included
"serious allegations about the
conduct of company principals". In
a sworn statement Chief Financial
Officer David Clark said that
Epic owed its customer builders
an estimated US$15 million for
parts and that the company had no
money to pay those debts. Also in
his sworn statement Clark alleged
many financial irregularities and
that company financial reports and
practices "did not comply with
generally accepted accounting
practices". Other sworn statements
by Clark and General Manager
David Hice alleged that the
company was a "chaotic financial
environment over which CEO Rick
Schrameck ruled exclusively".
Epic parent company Aircraft
Investor Resources and the company
voluntarily entered Chapter 11
bankruptcy, seeking to reorganize,
find investors and continue kitplane
production on a reduced scale. As
a result of the bankruptcy filing,
customers with aircraft under
construction at the company facility
were permitted to remove their
aircraft and parts.
In late November a bankruptcy
hearing date was set for December
7 with four different unnamed
companies, including one
established aircraft manufacturer,
expressing interest in purchasing
Epic from Chapter 11 bankruptcy.
That event did not result in a sale
of the assets and the company
moved to Chapter 7 liquidation. In
March 2010 filed court documents
showed that Harlow Aerostructures
offered to buy the company's assets
for US$2M effective March 30,
2010. The company was valued at
US$20,295,000 at that time.
In the 26 March, 2010, Chapter
7 auction, the state-owned China
Top pic: The Epic LT single turboprop aircraft
.
Left: The Epic Elite twin turbojet aircraft.
Above: Epic Victory single jet aircraft.