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UPDATE 1-US Judge dismisses investor suit against EADS
March 26, 2010 / 10:28 PM / 7 years ago

UPDATE 1-US Judge dismisses investor suit against EADS

NEW YORK, March 26 (Reuters) - An investor lawsuit against European Aeronautic Defence and Space Co EADS NV EAD.PA over production delays of the Airbus A380 belongs in Europe and not in the United States, a U.S. judge ruled on Friday.

Bristol County, Massachusetts retirement system and other investors sued EADS in Manhattan federal court in 2008. The losses by 11 U.S. investors were estimated at 6 million euro.

U.S. District Judge William Pauley granted EADS request to dismiss the lawsuit, which purported to represent investors in the United States who bought or otherwise acquired EADS stock from July 27, 2005 through March 9, 2007.

“The complaint is a narrative of the peril Americans face when they invest abroad,” Pauley said in a written opinion. “A court of limited jurisdiction lacks the authority to hear every grievance that arises overseas. On this record, Bristol County will have to pursue its claims where it purchased its shares - Europe.”

Neither a lawyer for Bristol County nor a representative for EADS could immediately be reached to comment.

According to the complaint, in December 2000, the A380 was introduced and the first delivery scheduled for 2006. But in early 2005 the company learned that electrical wiring harness systems could not be installed in the aircraft being assembled in Toulouse, France.

In June 2005, EADS announced delivery delays of two to six months that would subject it to financial penalties with customers, pushing down its share price. Further delays in 2006 caused another drop in its share price.

The case is In Re:European Aeronautic Defence and Space Co securities litigation, U.S. District Court for the Southern District of New York, No. 08-5389. (Reporting by Grant McCool; editing by Andre Grenon)

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