Monday 21 October 2019

Ryanair and boss O'Leary in bid to halt US police and fire fund's court action

Ryanair chief executive Michael O’Leary. Photo: Christopher Goodney/Bloomberg
Ryanair chief executive Michael O’Leary. Photo: Christopher Goodney/Bloomberg
John Mulligan

John Mulligan

Lawyers for Ryanair and its chief executive, Michael O'Leary, will this week ask a New York court to dismiss a lawsuit initiated against them last year following its pilot rostering debacle in 2017 and subsequent recognition of trade unions.

An Alabama pension fund for firemen and policemen in the US state's largest city of Birmingham slapped Ryanair and Mr O'Leary with the lawsuit last November.

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After Ryanair announced in 2017 it would recognise trade unions, its shares fell. It subsequently engaged in a lengthy process with pilots, cabin crew and trade unions across Europe to seal recognition agreements. It also offered pilots pay increases.

In an amended complaint from the pension fund filed in April, it claimed Ryanair and Mr O'Leary made false and misleading statements to shareholders regarding its employment issues.

"The disclosure of the truth about Ryanair's need to recognise unions and resulting increased costs and decreased profits had a devastating impact on the company's shareholders, wiping out millions in shareholder value and causing substantial damage to plaintiff," lawyers for the pension fund have claimed in court documents.

The complaint added: "Defendant O'Leary made, or caused to be made, false and misleading statements that maintained artificial inflation in the price of Ryanair ADSs."

A picket line at Dublin Airport last July. Photo: Aidan Crawley/Bloomberg
A picket line at Dublin Airport last July. Photo: Aidan Crawley/Bloomberg

The ADSs are American Depository Shares traded in the United States. The pension fund has launched the complaint against Ryanair as a class action suit. It's not unusual for shareholders in the United States to initiate such lawsuits after share price declines.

And in grudging admiration for the outspoken airline boss, the fund's lawyers said: "Defendant O'Leary had a reputation as an aggressive and penny-pinching, albeit brilliant, businessman who, in his own words, 'didn't give a s***' what customers or the general public thought of him."

Ryanair has previously said the claims against the airline and Mr O'Leary were "false" and "doomed to fail".

Lawyers for the airline and its boss have told the New York court where the complaint against them has been filed that they intend to file a motion this week to have the case dismissed.

The law firm, Cleary Gottlieb Steen & Hamilton, has sought permission from the court to file a lengthier memorandum of law in support of its motion than is typically permitted. Lawyers for the pension fund also want to submit a longer than permitted memorandum to oppose the motion.

The lawyers for Ryanair and Mr O'Leary confirm in the court filing there will be a "forthcoming motion to dismiss the first amended complaint, due on June 14".

A spokesman for Ryanair said: "We do not comment on pending legal matters."

Ryanair shares closed at €10.65 on Friday.

Irish Independent

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