17 on trial in EADS trading case

November 24, 2009|Associated Press

PARIS - Seventeen current and former executives at the parent company of Airbus, EADS, went on trial yesterday for allegedly making millions by exploiting their company’s troubles with the delayed A380 superjumbo project.

French regulators suspect EADS officials of insider trading because they sold stock options before the plane maker announced a big production delay that sent its shares plunging.

The case could result in fines for European Aeronautic Defence & Space Co. NV.

Yesterday’s session focused on procedural issues. Pointed questions about the A380 jet are expected later in the week.

Regulators have been investigating for nearly three years what the EADS executives and board members knew about profit-damaging technical problems with the A380 superjumbo and mid-range A350 aircraft when they sold shares or exercised stock options worth millions of dollars in 2005 and 2006.

When the A380 problems were made public in June 2006, EADS shares plunged 26 percent in one day, and the company sank into months of management troubles.