General Electric ‘conspired’ to acquire airline’s planes on the cheap, High Court judge rules
The message from the serried ranks of highly paid lawyers, barristers and advisers filling the London courtroom was clear: don’t mess with General Electric.
The expensively suited cream of our legal profession will have cost the multinational giant many millions of pounds to assemble, and to fight their case day in, day out, for weeks in the drab Rolls Building of the High Court.
When faced by those with the audacity to fight back against it, it seems the multinational corporate giant will spare no sum.
But GE was defeated by Alexander Lebedev, whose son Evgeny is the owner of The Independent, and his small legal team in a case that saw the judge find that the firm had staged a “conspiracy” against his small airline business and duped him out of millions of dollars.
It awarded him more than $10m (£6.6m) in damages, plus interest, plus costs. It was his second major courtroom victory in recent weeks, having recently seen Russian prosecutors drop charges of hooliganism fuelled by political hatred after he punched another businessman, Sergei Polonsky, during a Russian TV chat show.
GE’s reputation, and particularly that of its subsidiary Gecas – the world’s biggest owner of aeroplanes – were left damaged as the judge found senior executives to be unreliable witnesses even when testifying under oath.
The story begins back in 2010 when Mr Lebedev’s small German airline, Blue Wings, got into difficulties following the financial crisis. Like many airlines, its planes were bought with loans from GE’s PK Airfinance division.
When Blue Wings’ business deteriorated, PK repossessed them. It was under a duty of care to Mr Lebedev’s business to find the best possible price for the jets, so it could recoup its loan and pass on the remainder of the proceeds to him.
As an expert witness testified, the normal strategy to get the best possible price would be to contact all the airlines in the world who might be interested, show them the planes and start negotiating.
PK decided not to do this. This was because, as the court heard, it had cooked up a deal with one of its biggest customers, the fast-growing US airline JetBlue, to lease it the planes for a super-low price. That meant PK needed to buy the planes at a significant discount.
The auction, which even the judge described as “charade”, was badly advertised. The planes were parked in different spots around the world. And on the day of the auction at law firm Clifford Chance’s London offices, no bidders turned up – apart from PK.
Being the soul bidder, PK bought the planes at a knockdown price and flipped them to its Gecas subsidiary which then, sure enough, leased them on to JetBlue.
This was, the judge found, a “conspiracy” against Mr Lebedev’s business.
Mr Lebedev said: “GE tried to crush us by use of their financial power in the face of the facts, and failed. All of our efforts to reach an out-of-court settlement were rebuffed. Our resolve to press on in spite of the financial burden has now been vindicated by the court’s ruling.”
A Gecas spokesman said the company was disappointed by the ruling. “There was no wrongful conduct here and we plan to appeal the decision.”
Harry Potter actor suffered 'severe flu-like symptoms' on a flight from London to Orlando
First full-length look is finally here
World cities ranked in terms of safety, food security and 'liveability'
- 2 The awkward moment Sarah Palin raised $25,000 for Hillary Clinton's election campaign
- 3 Ball pool for adults opens in London
- 4 Amal Clooney gives excellent response to fashion question at European Court of Human Rights
- 5 Baldness could soon be treated using stem cells, scientists hope
Woman falls to her death as she celebrates marriage proposal at the edge of Ibiza cliff
Sex abuse inquiry: 'Victims receive death threats' after MPs release names online
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Teenager brandishing fake gun taken down by police after demanding airtime on Netherlands' NOS TV station
The awkward moment Sarah Palin raised $25,000 for Hillary Clinton's election campaign
9 reasons Greece's experiment with the radical left is doomed to failure
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
Have we reached 'peak food'? Shortages loom as global production rates slow
Greece elections: Syriza and EU on collision course after election win for left-wing party
British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
Liberal Democrat minister defends comments suggesting immigration causes pub closures
iJobs Money & Business
£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...
£13000 per annum: Recruitment Genius: This Pension Specialist was established ...
£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...
£25000 - £35000 per annum: Recruitment Genius: A Technical Report Writer is re...