World Fuel Services 2007 Annual Report Download - page 23

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for the clean-up costs of the contamination that is the subject of the County Suit. The County has threatened to
add the PRP’s as defendants in the County Suit, unless they agree to share in the cost of the environmental
clean-up at the Airport. We have advised the County that: (1) neither we nor any of our subsidiaries were
responsible for any environmental contamination at the Airport, and (2) to the extent that we or any of our
subsidiaries were so responsible, our liability was subject to indemnification by the County pursuant to the
indemnity provisions contained in our lease agreement with the County.
Should we be added to the County Suit, we would vigorously defend any claims, and we believe our
liability in these matters (if any) should be adequately covered by the indemnification obligations of the County.
Panama Litigation
In July 2005, Atlantic Service Supply, S.A. (“Atlantic”), a Panamanian fuel barge operator, filed suit against
Tramp Oil & Marine Limited (“TOM”), one of our subsidiaries, alleging that TOM is jointly and severally liable
for barging fees of approximately $1.0 million owed to Atlantic by Isthmian Petroleum Supply & Services, S.A.
(“Isthmian”). In July 2007, the court ruled against Atlantic, finding that TOM was not liable for any barging fees
owed to Atlantic by Isthmian. Isthmian has appealed this ruling. TOM and Isthmian were parties to an agreement
pursuant to which Isthmian provided storage, delivery and other fuel related services to TOM in Panama. In its
suit, Atlantic alleges (1) that Isthmian breached a barge charter agreement entered into between the two parties,
(2) that Isthmian entered into the agreement as an agent on behalf of TOM, and (3) that TOM is liable, as a
principal, for Isthmian’s breach of the agreement. Although TOM utilized the services of Isthmian for storage
and delivery of fuel, at no time did TOM request or authorize Isthmian to enter into any agreement with Atlantic,
nor did TOM request that Isthmian utilize Atlantic to provide services on its behalf. We do not believe that
Isthmian acted as TOM’s agent in its dealings with Atlantic, and we do not believe TOM is responsible for any
liabilities of Isthmian. We believe this suit is without merit and we intend to vigorously defend the action.
In August 2005, TOM filed a lawsuit against Isthmian seeking damages of approximately $3.1 million for
breach of contract and wrongful conversion of fuel owned by TOM. In September 2005, Isthmian filed a
counterclaim against TOM alleging that TOM is in breach of contract and seeking $5.0 million in damages.
These actions are pending in a Panamanian maritime court. We believe Isthmian’s suit against TOM is without
merit and we intend to vigorously defend the action.
Southeast Airlines Litigation
In November 2004, World Fuel Services, Inc. (“WFSI”), one of our subsidiaries, filed suit against Southeast
Airlines (“Southeast”), to recover amounts owed for jet fuel sold by WFSI to Southeast. In connection with the
Southeast litigation, WFSI sued additional parties claiming an interest in Southeast’s assets. One of these parties,
Joda LLC, filed a counterclaim against WFSI for damages and for replevin of certain aircraft and engines. In
February 2008, all pending claims among WFSI, Southeast and Joda LLC were settled and finally dismissed at
no cost to us.
Brendan Airways Litigation
WFSI is involved in a dispute with Brendan Airways, LLC (“Brendan”), an aviation fuel customer, with
respect to certain amounts Brendan claims to have been overcharged in connection with fuel sale transactions
from 2003 to 2006. In August 2007, WFSI filed an action in the state circuit court in and for Miami-Dade
County, Florida, seeking declaratory relief with respect to the matters disputed by Brendan. In October 2007,
Brendan filed a counterclaim against WFSI in which Brendan asserted various causes of action, including breach
of contract, fraud, and other claims. In February 2008, the court dismissed WFSI’s declaratory action. Brendan’s
counterclaim remains pending as a separate lawsuit against WFSI, but the court has dismissed certain of the
claims included in Brendan’s original counterclaim, including the claims for fraud. Brendan is seeking an
unspecified amount of damages. We believe that Brendan’s claims are without merit and we intend to vigorously
defend these claims.
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