Judge Apprves Settlement
LONDON (AP) _ A British judge approved a $48 million out-of-court settlement Friday of Laker Airways’ U.S. antitrust suit against 10 competitors over the 1982 collapse of the no-frills trans-Atlantic carrier.
The judgment was a defeat for the defunct airline’s founder, Sir Freddie Laker, who had described the proposed settlement as ″pitifully inadequate and ill-considered.″
High Court Judge Sir Nicholas Browne-Wilkinson said he had approved the settlement of the antitrust suit on behalf of the liquidators of four British- based Laker companies.
The judge said the agreement was ″subject to one minor precondition which has to be satisfied.″ He did not elaborate on the precondition but said: ″Basically the compromise has been approved by me in this country.″
He made no mention of a separate $8 million offered to Laker personally on condition he not pursue further legal action. Laker rejected the offer, and it was not known what steps were being taken to resolve the matter.
Earlier Friday, Laker’s former wife, June, withdrew her opposition to the settlement and accepted an original offer of $50,000 for her shares in the airline.
On leaving the courtroom, Laker said he had ″absolutely no comment″ on the judgment.
Laker’s liquidator, Christoper Morris, said he was ″very pleased″ with the judgment, but he refused to comment on the nature of the judge’s precondition.
The judge said the $48 million deal provides for full payment for more than 16,000 small creditors, including about 14,000 ticket-holders and 2,300 former employees.
Most creditors whose claims exceed $70,000 are to receive $70,000 plus 20 percent of the balance. Unspecified arrangments have been made to pay at least some of the money owed the biggest creditors, who put up the bulk of the money to buy airplanes.
Laker’s Skytrain service, which pioneered cheap air fares across the Atlantic, went bankrupt in February 1982 owing its creditors 260 million pounds, then equivalent of about $480 million.
Later in 1982, Laker’s liquidators filed a $2 billion antitrust suit in U.S. Federal Court against 10 U.S. and European airlines and an aircraft manufacturer, alleging they conspired in the late 1970s to drive Laker Airways out of business.
On July 12 of this year, lawyers for the liquidators and the defendants agreed on a $48 million out-of-court settlement of that suit. In addition, Laker was offered the $8 million in return for a promise not to pursue further legal action.
Laker rejected both proposals, and the liquidators sought judgment from the British court on their behalf.
The 10 airlines named in the Laker suit are British Airways, Sabena Belgian World Airlines, KLM Royal Dutch Airlines, the French airline UTA, Pan American World Airways, Trans World Airlines, Scandinavian Airlines Systems, Lufthansa German Airlines, Swissair and British Caledonian Airways. In addition, the McDonnell Douglas Corp. and McDonnell Douglas Finance Corp., were named as defendants.
The suit claimed the airlines threatened to do no further business with airliner manufacturer Douglas if it continued to offer Laker financig.