New York : European Aeronautic Defence & Space Co (EADS) has won its bid to dismiss a US shareholder lawsuit stemming from production delays to its Airbus A380, the world's biggest passenger aircraft.

US District Judge William H. Pauley III in New York ruled in EADS's favour on Friday, finding that the litigation, brought by Bristol County Retirement System on behalf of other investors, belongs in Europe.

"A court of limited jurisdiction lacks the authority to hear every grievance that arises overseas," Pauley wrote in his ruling. "Bristol County will have to pursue its claims where it purchased its shares — Europe."

Disclosure of the delays sent EADS down a record 26 per cent on June 14, 2006. The company and 17 current and former EADS executives on December 17 were cleared by France's market regulator of trading on inside information about the A380 delays. The Autorite des Marches Financiers also absolved shareholders Daimler AG and Lagardere SCA.

"We're disappointed and we disagree with the ruling and we're more than likely going to appeal it," David Rosenfeld, a lawyer for the investors, said in a phone interview.

Guy Hicks, a spokesman for EADS in the US, didn't immediately return a call after regular business hours on Friday.

‘Peril'

The investors sued in the US in June 2008. At the time of the disclosure, 73 US investors held 27 million shares, or seven per cent of the company, according to court papers. Bristol County, the lead plaintiff, is the pension plan for public employees of the Massachusetts county, with about $276 million (Dh1,013 million) in assets, according to court papers.

The investors said the company had enough contacts in the US, including American subsidiaries and an investor-relations office in Washington, for the litigation to proceed in New York.

"This was a European fraud," Pauley wrote. "EADS is headquartered in Europe. Its shares trade only on European exchanges. It is subject to regulation by the European Union and its member states."

Three banks have issued American depositary receipts in EADS shares that aren't sponsored by the company, the judge said.

"The complaint is a narrative of the peril Americans face when they invest abroad," Pauley wrote.