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schedule CFI’s trip around the third-party customer’s trip. In
that event, CFI could also use Ms. Harrah’s jet at the agreed
rate.
Petitioners enjoyed moderate success obtaining third-party
customers for BHJ. John Paul Mitchell, Tom Hanks, Don Henley,
Jean Claude Van Damme, and Kenny G all occasionally chartered the
Falcon. Petitioners also had several key customers who regularly
booked travel on the Falcon.
Petitioners encountered some difficulties with the Falcon,
however. The U.S. Coast Guard had purchased approximately 80
percent of all the Dassault Falcon 200s sold in the United States
and put them into service flying coastal missions at a low
altitude and over the coastline. The U.S. Coast Guard reported
problems with the engine seals as well as engine shutdowns in the
aircraft. In response to these difficulties, the FAA required
increased maintenance and service of the engines on all Dassault
Falcon 200s, including the Falcon petitioners owned. The
negative publicity surrounding the engines impeded petitioners’
charter sales and devalued petitioners’ Falcon.
Petitioners considered selling the Falcon, but they decided
to keep the Falcon and continue soliciting third-party charters
because they were concerned that the negative publicity would
depress the sale price. Mr. Rabinowitz anticipated a greater
return from chartering the aircraft in the meantime than from
selling it at a depressed value.
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