Thursday 18 October 2018

High Court dogfight ends in humiliation for Ryanair

A brave stand by three pilots against the low-cost carrier paid off in grand style, writes Liam Collins

Ryanair boss Michael O'Leary Photo: PA
Ryanair boss Michael O'Leary Photo: PA
Liam Collins

Liam Collins

A casual observer might wonder why it took seven weeks, including 24 full days in the High Court in Dublin, to decipher an email headed: 'Pilot update: what the markets are saying about Ryanair'. Even some of those in court were perplexed by the length of a trial that was expected to last three weeks and ended in a humiliation for the Irish airline.

But one thing is certain; there was nothing low cost about these lengthy proceedings.

With High Court costs running at up to €100,000 a day, defending the case against the €20bn airline was an exceedingly brave and possibly foolhardy stand by three pilots who were putting everything on the line.

The outcome was also a serious blow to celebrity libel lawyers Johnsons, who took the case on behalf of Europe's biggest airline. Initiated by 'lawyer to the stars' Paul Tweed, the proceedings were handled in court by his former firm Johnsons, as Mr Tweed has since struck out on his own after 39 years with the international solicitors company which is known for representing celebrities in defamation proceedings.

When a jury decided last Thursday evening that the email circulated by members of the Ryanair Pilots Group (RPG) was not malicious, and therefore the three defendants had not defamed Ryanair, it was the third strike in what has surely been an annus horribilis for Ryanair and its garrulous boss Michael O'Leary, who spent the better part of two days in the witness box.

In the end, the jury didn't quite see it his way.

As 2017 drew to a close, he had weathered the cancelled flights debacle, done a U-turn on union recognition and now, in the dying embers of the year, suffered the humiliation of a Dublin jury finding against the company he is so closely identified with in a long drawn-out dogfight over an email circulated to 2,289 Ryanair pilots in 2013.

That the case, Ryanair & Ors v Van Zwol & others, in Court 25, and its aftermath did not get much public traction is understandable - it was a serious but internal issue that most ordinary people knew nothing about until it ended up in the High Court more than four years after the event. Even then it was pushed back to the business pages of the newspapers, scarcely getting coverage elsewhere because of the nature of the case.

In May 2013 Ryanair published its annual results for the year ending March 31, 2013, saying it had made a healthy profit of €569m, but advising that owing to increased costs, the outlook for the coming year was cautious. Shortly afterwards David Bonderman, a major shareholders and director of Ryanair and one of the men credited with bringing the airline into public ownership, sold 1.5 million shares in the company owned in trust by his family. A non-executive director, Michael Hogan, sold a more modest 25,000 share options.

On September 4, 2013 Ryanair issued what is known in business circles as a 'trading update' or possibly a profit warning, alerting investors that earnings would come in at 'the lower end of the scale' of the €570/€600m predicted by analysts for the following year. (As it happens, the profit for that year was €523m.)

A week later the email was circulated to the RPG. Captain Evert Van Zwol, a pilot with KLM, retired Aer Lingus pilot Ted Murphy and former Ryanair pilot John Goss, who was sacked for 'gross misconduct' after giving an interview to Channel 4 some months before his retirement about airline safety, were sued for defamation by Ryanair over the September 12, 2013 email.

Ryanair claimed it falsely implied among other things, that the airline misled investors and facilitated insider dealings by management.

The case was also taken in the wake of a 2013 Channel 4 programme about Ryanair safety standards in which Mr Goss and Mr Van Zwol had participated and which led to a number of defamation proceedings, which were initiated against media organisations on behalf of Ryanair and which, in the most part, were successfully settled in favour of the airline.

The lengthy case in Dublin revolving around the email circulated to members of the RPG, which ended last week in defeat for the airline, basically pitted the carrier against three men who had dared to circulate unflattering material, albeit containing serious charges.

In defamation cases, the jury - in this case, 11 members because one juror got sick on the last day of the trial - is asked to answer a number of questions relating to the trial, agreed between the two opposing legal teams with the supervision of the judge, in this case Judge Bernard Barton.

The jury was asked whether the email update by the RPG meant Ryanair was guilty of market manipulation. It answered, by a majority verdict (nine or more), Yes, that the email circulated by the defendants did mean that the carrier was guilty of market manipulation.

It was also asked did this mean that the airline had misled investors, knowingly facilitated insider dealing by management or that Ryanair conspired with managers to abuse the market for its shares.

To this, the jury answered No. The email, it found, had qualified privilege and Ryanair had failed to prove that it was malicious.

The case was dismissed by Judge Barton who also awarded costs against Ryanair, but put a 'stay' on this order in the event of an appeal.

"We wish to dedicate today's victory to all Ryanair pilots who are standing strong for each other around Europe and have through their collective courage succeeded in having Ryanair change its long-standing policy of union recognition," said Mr Van Zwol in a statement.

Despite the length of the case, the complicated nature of the evidence and what was at stake, particularly for three defendants who had to sit through seven weeks where their fate balanced on the scales of justice, Ryanair v Van Zwol and others did prove one thing - sometimes the small man does win.

Maybe it's a lesson Michael O'Leary will take to heart.

Sunday Independent

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