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Widespread anger at Swissair trial outcome

A former Swissair Chief Executive Eric Honegger (L) answers questions after the Swissair trial verdict Reuters

There has been harsh criticism of a decision by a court near Zurich on Thursday to acquit all 19 former Swissair managers of criminal malpractice.

This content was published on June 7, 2007 - 21:40

Much of the criticism was directed at the prosecutors for failing to make a strong enough case as well as the court for awarding the defendants around SFr3 million ($2.45 million) in compensation.

It was Switzerland's largest corporate trial and watched closely since it involved the downfall of a Swiss icon. The national airline, Swissair, was grounded on October 2, 2001 after months of financial problems.

Thousands of employees lost their jobs and retirement benefits while shareholders lost their savings.

A former Swissair staff member described the court's verdict as a "mockery". A lawyer representing minor shareholders said the decision was a "slap in the face".

The three-judge court rejected all charges that included damaging creditors, mismanagement, making false business statements and forging documents.

"There is no evidence that the defendants knowingly acted to damage the company," said the presiding judge, Andreas Fischer.

"In part, there is a lack of evidence from the prosecuting attorney that the critical actions taken actually led to damage at the SAirGroup," he said, referring to the airline's holding company.

"This court's task was not to investigate the whole Swissair story or to find out why the airline was grounded," said Fischer. "We had to look at the specific allegations made in each case of the indictment and were limited to that."

Debacle

Of the four parties represented in the Swiss government, the centre-right Christian Democrats released a statement calling the legal proceedings a "debacle", while the Zurich branch of the right-wing Swiss People's Party demanded the resignation of the leading prosecutor in the case.

Union leader Daniel Vischer added that it was a "complete washout" for the prosecution. His opinion was shared by parliamentarian Gerold Bührer of the centre-right Radical Party: "One wondered before the trial began whether there was sufficient evidence [to find the defendants guilty]."

Leader of the centre-left Social Democrats, Hans-Jürg Fehr, said it was incomprehensible that all 19 defendants could be acquitted, and be financially compensated. He said it was unacceptable that they could "become rich at the expense of taxpayers".

Urs Eicher, speaking on behalf of a flight attendants union, also criticised the payout. "Those who suffered real damage, the small people who lost jobs or pension funds in the Swissair bankruptcy, will get nothing," he told Swiss TV.

However, legal experts said Swiss law stipulates that defendants found not guilty must receive compensation.

Appeal?

The prosecutors, who had demanded a six-month prison sentence for Mario Corti, the last CEO of the SAirGroup, and a range of suspended sentences for the other managers, said they had yet to decide whether to appeal the decision.

They have a ten-day deadline.

The defendants were relieved by the outcome. In a statement, Corti's lawyer said "the court...made its decision in appreciation of all the facts." Another defendant and former CEO of the SAirGroup, Eric Honegger, expressed relief but added that "the Swissair trial will stay with me until the end of my life".

During the trial, many of the defendants placed the blame partly on the big Swiss banks and the September 11 terrorist attacks for the downfall of the national airline.

swissinfo with agencies

Key facts

There were 19 defendants, including 16 former members of the Swissair board and the company's top management, plus three outside consultants who advised the airline.
The investigation took five years and produced 280 metres worth of documents. The prosecution's indictment ran to 100 pages.
The Zurich cantonal prosecutor spent 40,000 working hours on the case, questioning 300 people and searching 20 houses.
According to the chief prosecutor, the costs of the investigation could total SFr4-5 million ($3-4 million), not including prosecution staff salaries.

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In brief

Swissair planes were grounded in October 2001, after the company had been in business for 71 years.

The downturn in the aviation market after the terrorist attacks of September 11, 2001, proved the last straw for the heavily indebted Swissair, which folded the following year.

The airline collapsed because it over-extended itself by buying stakes in numerous loss-making airlines, including Belgium's Sabena and Poland's Lot, in an attempt to form its own airline alliance.

The remains of Swissair and the regional carrier Crossair were brought together in 2002 to form the new national carrier Swiss, which was in turn taken over by Germany's Lufthansa in 2005.

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