KLM has won a partial victory in the New York Supreme Court in the first round of its legal battle with partner Northwest Airlines over shareholder rights.

The battle goes back to an acrimonious boardroom fall-out between the two airline managements just over a year ago. Northwest accused KLM of attempting to gain control of the company, and adopted a series of measures to prevent its partner from increasing its 18.8% shareholding or its boardroom influence.

The Dutch carrier's first argument is that the original Northwest shareholders have attempted to "alter existing agreements", including appointment of board members, so "weakening" KLM's position as a shareholder.

The Supreme Court has found in a preliminary decision that there is a case to be answered on these points, although it has also ruled that other issues relating to KLM's influence over mergers and share sales will not be examined. KLM is considering filing an appeal against this part of the ruling.

A second court case is pending in Delaware over Northwest bids to cap shareholdings in the company at 19%. KLM claims that this would invalidate its option to build its stake to 23.4% in 1998. KLM confirms that the operational alliance is still being expanded.

Source: Flight International