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Sat, Aug 19, 2006

Ryanair CEO Threatens Lawsuit Over Security Restrictions

Lawyers Question Validity Of Case

Is it a valid complaint... or merely "saber-rattling?" That's the question presented by a threatened lawsuit by Ryanair CEO Michael O'Leary against the British government, over the high cost of increased security for the low-cost carrier.

In a letter sent to British Transport Secretary Douglas Alexander this week, O'Leary said to date, the one-week-old security restrictions -- put in place August 10 after a terrorist plot to bring down airliners flying to the US from Britain was uncovered -- have cost the Irish LCC "a couple of million" euros, from cancelled flights and lost bookings.

To date, Ryanair has seen its weekly bookings fall by 10 percent -- due, O'Leary says, to heightened screening requirements and a ban on carry-on luggage. Since January, Ryanair has encouraged its passengers to carry on their luggage, by charging a fee on all checked bags.

The Associated Press reports Ryanair wants those restrictions eased... as well as an assurance from the government that military and police personnel will lend a hand with airport security, the next time there's a major security alert. That, in theory, would lead to shorter wait times for passengers going through screening.

O'Leary added that if the current restrictions are eased in the next seven days, Ryanair would not file its lawsuit. However, if the restrictions continue, the cost to Ryanair would be severe... and O'Leary says the government will have to pay.

But does the airline have a case?

"It’s nothing more than a bit of saber-rattling because Ryanair is petrified of what the new security measures will do to its business if they are made permanent," one lawyer told the London Times.

Mark Franklin, head of aviation law at DLA Piper, added O'Leary's lawsuit threat falls "at the first hurdle," as it makes reference to the Transport Act 2000 in claiming a right to retribution -- despite the fact the government says it imposed the tougher restrictions under the earlier Aviation Safety Act 1982.

Another lawyer interviewed by the Times Online says Ryanair is merely posturing in threatening legal action... because, essentially, that's all it can do.

"Public threats of 'do this or we'll sue' are often about applying pressure on the party being threatened rather than actual legal merit," said the unidentified attorney, "and this looks like a classic case of that."

FMI: www.ryanair.com, www.baa.com

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