17 September 2008

Travelmole Guest Comment: Newcastle-based Freedom Flights director on his struggle to distance himself from failed Freedom Flights

Stuart Ramage, Freedom Flights director, talks about his attempts to end the confusion between his Newcastle-based company and the other Crawley-based Freedom Flights, part of the failed XL Leisure Group.

He also claims governing bodies should have picked up on signs of trouble earlier.

"Due to the recent collapse of XL Airways I would like to stress that my company, Freedom Flights (Newcastle) ltd, has always been and remains independent, trading as normal with no connection to the Freedom Flights ltd based in Crawley who along with XL Airways are now in administration.

We commenced trading in 1987 and due to our naivety omitted to trademark the name and subsequently with the launch of the internet we registered the domain freedomflights.com, but again naively failed to register co.uk etc. We we were young then, you live and learn!.

As a company we specialise in long haul scheduled airfares and tailormade itineraries for both the leisure and business market, turnover approx Ã&#pound;1 million and are based in the North East of England with clients throughout the UK and abroad.

In approx 2001 we became aware of a new Ã¢â¬ËœFreedom FlightsÃ¢â¬â¢ who at that time had joined ABTA, we complained to ABTA that this would cause confusion but were told that due to their tour operator status they would be accepted. We then contacted the Crawley based company who, unbelievably, were unaware of our existence and flew up to Newcastle to see who we were and what we did. Initially we attempted to work together and co exist, given that they were a Southern-based company operating to Europe and at that time had no real Ã¢â¬ËœregionalÃ¢â¬â¢ presence, whilst we dealt in the long haul market .

In retrospect this was never going to work.

As they and XL expanded it became clear that a working relationship was impossible and the confusion was apparent in the many telephone calls and emails received in error from both the public and agents alike. In early 2006 I contacted Freedom Flights Ltd in an attempt to reach an amicable arrangement for a way forward, but despite my best endeavours, even offering to rebrand and sell the .com name, we were unable to reach agreement.

Throughout 2006 and into 2007 we exchanged expensive and time-consuming correspondence through our respective lawyers culminating in my meeting with a barrister in March 2007 to discuss the possibility of court action for Ã¢â¬Ëœpassing offÃ¢â¬â¢ against Freedom Flights for me to Ã¢â¬ËœreclaimÃ¢â¬â¢ sole rights to the name Freedom Flights. The legal opinion was strongly that I would win the case but it would be expensive and protracted and I had to make the decision as to proceed or not.

This decision was then made much easier by a close look at the Freedom Flights Ltd accounts posted 31 October 2006.

Whilst it was difficult to wholly understand the complex web of companies a number of issues raised enough concerns in my mind and those of my legal team and accountants to reach the conclusion, as far back as April 2007, that to sue would be frankly a waste of time due to the nature of the company structure and the figures in the balance sheet.

Alarm bells were ringing with the resignation of KPMG as their auditors and of huge significance to me was the line from page 9 in reference to Freedom Flights :

Ã¢â¬ËœXL Leisure Group plc, an intermediate parent undertaking has confirmed that it will provide support sufficient for the company to continue as a going concern for the foreseeable future.Ã¢â¬â¢

A more litigious person may not have been put off by the accounts but it was enough for me to decide against a pursuit through the courts, further accounts and the events of last week have vindicated that decision.

I am not writing this and being wise after the event, as I believe that the issue of the XL group finances were in the public domain and would question whether others in the travel trade and the governing bodies perhaps should have paid closer attention.

My genuine sympathy goes out to the many stranded passengers, those who have lost money and holidays and with the many staff who will lose their jobs.

The focus of my attention now has to be on running my business distancing myself from the fallout from XL and the Ã¢â¬ËœotherÃ¢â¬â¢ Freedom Flights and protecting my good name."