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Battle of the Airlines: 'Lord King was calling me a liar, so I sued him': Martyn Gregory reports on BA's 'dirty tricks' campaign, which he uncovered as producer/director of Thames Television's This Week programme

'I JUST can't believe this is all a coincidence. I'm absolutely convinced that BA are trying to put Virgin Atlantic out of business,' Richard Branson said exactly a year ago at his home in Holland Park, west London, writes Martyn Gregory.

For the previous three hours he had pored over the notes he kept in a battered black book for the past 18 months. They detailed extraordinary allegations of passenger poaching, car break-ins and document shredding.

For over a year, Mr Branson had claimed his routes had been 'swamped' by BA flights and that every time he started a new flight BA would 'bracket' it by running flights just before and after his. Bucket shops, he had claimed, were also being flooded with BA tickets.

Mr Branson's allegations of dirty tricks had been greeted with widespread scepticism. His detailed list of complaints to BA's non-executive directors had been contemptuously ignored. The representatives of the British press that the World's Favourite Airline so assiduously cultivated rubbished him.

He was haunted by the memory that his personal hero, Sir Freddie Laker, had seen his airline destroyed by a cartel of international carriers including BA. He was also conscious of the aftermath. Within a year of Laker's collapse in 1982, the airline's liquidators Touche Ross brought a billion-dollar lawsuit in Washington alleging the violation of anti-trust laws by several international airlines including British Airways.

In 1985 it was revealed that BA and the other defendants named in the lawsuit were prepared to pay Laker nearly pounds 6m (as well as settling in full the claims of all the other Laker creditors, Laker staff and pension fund). Sir Freddie told Mr Branson to 'sue the bastards'.

This Week spoke to former Virgin passengers in Los Angeles who had transferred to BA in droves in the face of rumours that Virgin was going bust: BA was poaching passengers at JFK in New York as they got out of Virgin limousines. We identified a senior BA official in New York, Dick Eberhart, as being responsible for starting damaging rumours that were also sweeping the airline industry on the East coast.

Two former BA managers confirmed the shredding of vital BA documents on Virgin and the targeting of both the airline and Mr Branson personally by Lord King's company.

Most crucially of all, a clandestinely recorded tape of Brian Basham, a PR consultant, emerged. In it he spent nearly an hour trashing Virgin as a company and attempting to persuade Chris Hutchins, gossip columnist of Today, to run scurrilous and fictitious stories about Mr Branson and Virgin. He claimed the support of Lord King and we established that he was being paid pounds 100,000 a year by BA's director of public affairs, David Burnside, to act on BA's behalf.

What emerged from operatives inside BA was that they had been hacking into Virgin's computer files covering bookings and flights and using the imformation to undermine Virgin's business by stealing its passengers.

Mr Branson offered to bury the hatchet with Lord King if he sacked Brian Basham, apologised and promised that the dirty tricks would cease.

Lord King refused, and in a letter to members of the public who wrote to him to complain about British Airways' tactics stated that Branson's allegations in the programme were no more than a publicity stunt.

'King was effectively calling me a liar so I sued him,' Mr Branson said.

(Photograph omitted)