Lithuanian court rejects bankrupt airline's claim against airBaltic

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The Lithuanian Supreme Court rejected the claim by the bankrupt Lithuanian national airline “flyLAL-Lithuanian Airlines” for a refund of more than €16 million from the Latvian national airline airBaltic, which it blamed on unfair competition and forcing flyLAL out of the market, LETA reported on June 20.

The Lithuanian Supreme Court issued this judgment on 16 June, thus ending nearly 14 years of legal proceedings, according to information provided by the Cobalt law bureau representing airBaltic and Rīga International Airport.

The dispute between flyLAL and airBaltic and Riga International Airport started in 2008.

flyLAL then turned to court against airBaltic and Riga airport, claiming compensation for damages caused by the Lithuanian company as if the two Latvian companies had entered into an agreement on lower prices at Riga airport. The Lithuanian airline also insisted that airBaltic's price dumping policy at Vilnius airport has pushed it out of the market. Latvian companies disputed the expert's conclusion that the Lithuanian company sustained losses of €43.4 million due to the alleged discriminatory discounts from 2004 to 2008.

In January 2016, after approximately seven years of litigation, Vilnius Regional Court concluded that airBaltic used unfair competition on disputed routes and decided that airBaltic should compensate for losses of EUR 16.121 million, while the airport was not held reliable. flyLAL wanted €57.87 million in damages from both Latvian companies - airBaltic and Riga airport.

airBaltic appealed the decision. On 28 June 2021, the Lithuanian Court of Appeal decided that "there had been no prohibited agreement because the defendants [airBaltic and Riga airport] fulfilled their mandatory obligations under Latvian law. Therefore, the court rejected flyLAL's arguments that airBaltic implemented an unfair pricing strategy, sought to distort competition, remove competitors from the market or create barriers to their entry."

On June 16, 2022, the supreme court decided to leave in force the decision taken by the Lithuanian Court of Appeal a year ago to reject again the judgment given by Vilnius Regional Court in January 2016 that “flyLAL” is due to compensation of EUR 16.121 million from airBaltic, thus ending the proceedings.


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