The hostilities between British Airways and Virgin deepened yesterday as they continued to dispute whether the "dirty-tricks" allegations had been settled.
Virgin accused its rival of returning to the habits of the 1980s, when claims of sharp practice led to Virgin's owner, Richard Branson, starting multi-million-pound lawsuits against BA on both sides of the Atlantic.
On Thursday BA said it had paid £265,000 to Virgin in settlement of the UK legal action and that the rival airline had agreed to meet BA's legal costs, estimated at £750,000. Robert Ayling, BA group managing director, said: "This closes the so-called `dirty-tricks' file."
Yesterday, however, a spokesman for Mr Branson said that the "dirty- tricks" issues - attempts to discredit Virgin, poach customers, and computer hacking - were very much alive. For BA to suggest otherwise was "manipulating the reality of the case", he said.
Virgin has launched a $1bn (£625m) anti-trust suit against BA in New York - but Mr Ayling said that this was about market and competition issues.