Battle of the Airlines: Heads may roll over BA dirty tricks campaign: Investors believe an executive must have sanctioned the tactics used against Virgin. Mary Fagan reports

SPECULATION continued to mount yesterday that senior British Airways executives could become casualties of its dirty tricks campaign against Virgin Atlantic and Richard Branson.

One of the company's largest institutional shareholders said it felt that the actions taken against Virgin must have gone to at least some of the directors for approval and it found it worrying that no one at the airline company had accepted responsibility.

The fund manager said: 'There are boundaries of good and bad competition and BA appears to have overstepped the boundaries of good competition and fair competition. No one at senior level in BA has owned up and taken responsibility. It was obviously a pretty severe mistake. That is a worry.'

Although he stopped short of saying that heads should roll, he added: 'Someone must have sanctioned it at director level and with hindsight that was a mistake.'

In an apology read in court on Monday by BA's counsel, Christopher Clarke QC, both British Airways and Lord King, BA's chairman, apologised for the injury caused to the reputation and feelings of Mr Branson and Virgin Atlantic by articles and letters they had published. But it was emphasised that none of BA's directors were a party to any concerted campaign.

A fund manager at another of the top shareholders in British Airways expressed concern over the possibility of further legal action by Virgin in the United States. He said the first thing was that the dust ought to settle but that the implication of a possible further lawsuit in America 'has a certain nasty tinge to it'. However much shareholders say that the board should have known what was going on, the board will say that it did not know what was going on, he said.

His feelings were that there may not be personal casualties among BA senior management. 'BA is a well-run aviation company and this is a sideshow - an unfortunate one but none the less a sideshow. As long as the capability of the people running the airline is not impaired by this then they should go on doing the job.' He added: 'On the basis of the information I have, nothing illegal has been done, in which point I am not sure heads should roll.' He also said that he did not think that confrontation between the company and its shareholders would be helpful.

Key players in other major institutions are declining to comment. It is not clear whether there will be further repercussions over who takes responsibility for the dirty tricks campaign.

Brian Basham, the public relations adviser at the centre of the controversy, said in an affidavit served on BA and Virgin Atlantic that at no time had he acted without the knowledge or approval of the British Airways board.

Extracts from a letter written by Mr Basham's lawyer said: 'The clear implication is that Brian was acting in excess of his authority whereas Lord King, Sir Colin Marshall and Robert Ayling well know, they and the company gave full authority to all his actions and it was Brian himself who played a major role in exercising restraint in what was allowed to appear in the press about Branson.'

Sir Colin Marshall, BA's deputy chairman and chief executive, has said: 'British Airways is taking appropriate action to ensure the regrettable incidents which we have identified involving our employees do not occur again.'

However, British Airways refuses to say whether that means the axe will fall on members of its staff. Nor will the company comment on the claims made by Mr Basham.

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