8th Circuit affirms fees, orders lower interest rate in Jet Midwest case

The Blueprint

• 8th Circuit upheld $5.8 million attorney fee award in contract case.
• Court vacated over $1.1 million in expert witness fees
• Prejudgment interest reduced from 14 percent to Missouri’s 9 percent rate.
• Case remanded for recalculation of interest and costs.

The U.S. Court of Appeals for the 8th Circuit affirmed in part and reversed and remanded in part a judgment in a contract suit involving attorney’s fees, expert witness fees and interest rates stemming from a breach of a loan agreement.

The parties in the suit appealed the district court’s decision on remand regarding attorney’s fees and prejudgment interest. The appellate court’s decision was filed April 2, 2026, authored by Judge Ralph R. Erickson, with Judges Raymond W. Gruender and Jane L. Kelly concurring.

The dispute began in 2015, when Jet Midwest International agreed to lend $6.5 million to Jet Midwest Group to finance the purchase of a Boeing 737-700 aircraft. When Jet Midwest Group failed to repay the loan, Jet Midwest International filed a lawsuit for breach of contract. In 2017, the district court ruled in Jet Midwest International’s favor but initially denied its request for attorney’s fees. That decision was reversed on appeal, and the case returned to the district court for further proceedings.

When Jet Midwest attempted to collect on the judgment, it discovered that Jet Midwest Group had no funds. This led to further litigation under the Missouri Fraudulent Transfer Act, with Jet Midwest alleging assets were improperly transferred to individuals and entities connected to the company, including F. Paul Ohadi, Kenneth M. Woolley, KMW Business Jets and Alta Airlines Holdings. The district court ultimately ruled in Jet Midwest’s favor, awarding $6.5 million in damages plus over $2.1 million in interest.

However, Jet Midwest initially sought over $8.7 million in fees and costs, including more than $1.1 million for expert witnesses. An earlier fee award — reduced by 25 percent from the original $8.75 million request to just over $6.5 million for what the district court described as “overlawyering” — was vacated on appeal because the district court failed to perform a lodestar calculation and did not analyze which requested costs were recoverable under federal statute.

On remand, Jet Midwest voluntarily reduced its fee request to about $5.85 million and sought a 1.5 multiplier. The district court rejected the multiplier and awarded approximately $5.8 million in attorney’s fees, along with $1.1 million in expert fees and additional costs, with prejudgment interest set at 14 percent.

The 8th Circuit affirmed the district court’s award of $5.8 million in attorney’s fees and upheld the court’s decision not to apply a 1.5 multiplier. The court said that, although there was no statutory or contractual basis for attorney’s fees, Missouri’s special circumstances exception to the American Rule allowed for such an award.

“The district court did not err when it rejected Jet Midwest’s claim that a multiplier is ‘part of the lodestar’ calculation or that the complexity and egregious nature of a parties’ misconduct can be a basis to apply a multiplier,” the opinion stated.

However, the appellate court reversed the district court’s decision to award more than $1.1 million in expert witness fees as part of attorney’s fees. The court emphasized that, under both federal and Missouri law, attorney’s fees and expert fees are separate elements of litigation costs. While there are limited circumstances where expert fees might be recoverable as attorney’s fees if consistent with prevailing billing practices, the court found that Jet Midwest failed to provide evidence of such a practice. It also found the record did not sufficiently explain the experts’ role or justify treating those costs as attorney’s fees. The award of expert witness fees was vacated.

The appellate court also reversed the district court’s use of a 14 percent prejudgment interest rate. The district court imposed the higher rate based on the underlying loan agreement and the defendants’ conduct, but the 8th Circuit found that Missouri’s statutory prejudgment interest rate of 9 percent applies. The case was remanded for the district court to apply the correct 9 percent rate.

“Prejudgment interest is an issue controlled by state law and we are not free to substitute our own opinion. Jet Midwest is entitled to prejudgment interest at the rate of nine percent,” the opinion stated.

The 8th Circuit also clarified that, after Aug. 6, 2020 — the date of the amended money judgment — postjudgment interest is governed by federal law. The court found that the district court erred by failing to apply the federal postjudgment interest rate under federal statute from that date forward.

“The district court did not consider whether a judgment had been entered triggering the federal postjudgment interest statute. While state law governs the award of prejudgment interest, federal law governs postjudgment interest … The federal statute calculates interest at a prescribed floating rate on ‘any money judgment in a civil case recovered in a district court,’” the opinion stated, referencing Weitz Co., Inc. v. Mo-Kan Carpet, Inc. “The district court recognized Jet Midwest’s right to attorney’s fees in its May 27, 2020, judgment. The district court, however, did not enter a money judgment until August 6, 2020 … Thus, on August 6, 2020, the district court both entered a money judgment and recognized Jet Midwest’s right to recover attorney’s fees. The district court erred when it did not apply the federal postjudgment interest rate to calculate interest after August 6, 2020.”

The case is Jet Midwest International Co., Ltd. v. Jet Midwest Group, Case No. 25-1033, 25-1034, & 25-1306.