The Westland District Council is being sued for $773,000 by Franz Josef heliport operators who say the council "deceptively" squeezed them out of the helicopter tourism market at the glaciers.
Callery Holdings and Glacier Air, both owned by Gavin Molloy and Lindsay Smith, are taking the council to the High Court because they say the council forced them off the land and took over the site to start their own heliport company.
In 2004 the council decided that Glacier Air must move by 2008 because the helicopters were causing too much air and noise pollution; that was reaffirmed in 2007 in another council decision.
Mr Smith and Mr Molloy then bought new land so they could relocate the heliport, paying for all the work required for the resource consents to do so.
The court papers state that on August 3, 2009, council chief executive at the time, Robin Reeves, granted Hokitika Airport Ltd (HAL) a lease over the existing site to operate a heliport for five years, with an option for a renewal of a further 10 years after that.