Pension mis selling has become a pertinent issue in the UK. American shareholders are suing Michael O’Leary, the CEO from Ryanair and the firm for making misleading and false statements concerning the industrial relation upheavals that have affected the airline. The airline has endured a couple of strikes by cabin crew and pilots during the summer as the new trade unions continue to work had to transform the current working conditions. One of the shareholders, “City of Birmingham Firemen’s and Policemen’s Supplemental Pension System” has filed a suit in one of the New York Courts seeking damages against Mr. O’Leary, and Ryanair.
The pension fund headquartered at Birmingham, Alabama points out that the CEO and the firm issued misleading and false statements concerning relationships with unions and workers between May last year and Sept this year. The misleading statement included inflating the share price of the carrier. The complainants argue that the airline, and the CEO concealed information about
the deteriorating labour relationships in debates and company statements shared with the industry experts. The lawsuit files observe that the firm was not in a stable financial position to keep or hire sufficient pilots to satisfy the work demand in the wake of strikes, significantly elevating the cancellation risks.
To hire and maintain staff, the airline needed to elevate benefits and pay significantly to over €100 million. The shareholder, who is also representing other investors that
Ryanair would have warned the investors that the profits could lower below the expected levels. At the close of Nasdaq market in New York, the US depository shares had lowered to €70.67, a 15% drop. The cost was also 36% lower than the amount reached in the same period under the claim.
According to the city of Birmingham, the decline in the depository shares resulted from the extent, and the scope of the firm’s fraudulent dealings. Ryanair has affirmed that it is committed to defeating the misleading
and unreasonable pension mis selling claims. The airline argues that the staff strikes were just of a small magnitude and could not in any way have affected the normal operations. The firm has also argued that it faced minimal disruptions when it operated over 90% of its schedule during the eight days of strikes.
Conversely, Ryanair blamed the staff strikes, and the shortage of air traffic control specialists for the disruptions in all its EU flights. The firm continues to refute the claims and point out that they will fail miserably because they are not grounded on any solid fact. The Ryanair lawsuit is likely to become one of the landmark pension mis selling lawsuits in 2018. Experts and investors in the airline are eager to see whether the case will be thrown out or approved by the New York Court.Mis-Sold Pension, Pension Claims, Pension Support In UK