AIRBUS SE 
PARIS (Reuters) - Prosecutors in the Airbus (>> AIRBUS GROUP) insider trading case suffered another setback on Tuesday when a Paris court refused to accept the prosecution dossier, a move which could further delay one of France's most keenly awaited corporate trials.
In a rare decision, judges at the Paris criminal court ordered that the lengthy legal file giving the reasons for the charges should be sent back to an investigating magistrate for revisions after defence lawyers argued that it was flawed.
The trial, involving allegations of insider trading in the shares of Airbus Group, formerly known as EADS, had already been effectively frozen for up to six months after judges on Friday sought a constitutional ruling on whether it should go ahead.
Lawyers involved in the case said the latest decision could delay the trial by between several months and two years, but most predicted the stage of giving evidence in court would begin in about a year if the higher courts allow it to proceed.
Seven current and former executives of Airbus and two former shareholders, Lagardere (>> LAGARDERE SCA) and Daimler (>> Daimler AG), are accused of seeking to profit from share sales in 2006 while knowing of problems that later damaged the EADS share price.
All deny the charges, and their lawyers have challenged the legality of the trial on the grounds that they had already been cleared by the stock market regulator, citing the right not to be pursued twice under the European Convention on Human Rights.
As a secondary line of defence, the lawyers also argued that the prosecution case was badly formulated, a question on which the panel of three judges gave its ruling on Tuesday.
"It's a victory but I am not satisfied because my client has been cleared by (markets regulator) AMF," said Frederic Peltier, lawyer for Alain Flourens, head of the A380 jet programme whose past industrial problems were expected to dominate the trial.
"I am both happy and extremely angry," he said.
Judicial sources said after the hearing that prosecutors would send the file back to the same investigating magistrate, a judicial officer responsible for preparing the case, as soon as possible.
On day one of the trial on Friday, the court agreed to refer questions from the defence on whether the case breached the 'double jeopardy' rule, which prevents someone being tried twice, to France's Constitutional Council via the Supreme Court.
The Supreme Court has three months to decide whether to forward the defendants' challenge to the nine-member Council, which then has another three months to give its ruling.
If the Council upholds the trial, it can resume after the investigating magistrate has revised the document outlining the insider trading charges, which carry a maximum penalty of two years in jail and a fine equal to 10 times the share profits.
The chief executive of Airbus Group, Tom Enders, wrote to senior staff on Friday saying the company stood by those on trial and suggesting the trial infringed their basic rights.
Lawyers for small investors whose complaint triggered the eight-year investigation, following a 26 percent drop in the EADS share price in one day in June 2006, argued their own rights to justice would be ignored if the trial were halted.
The case covers a dramatic stage in the history of Europe's largest aerospace firm, during which A380 delays triggered an industrial crisis and Airbus was under pressure to improve the A350, its response to Boeing's next-generation 787 Dreamliner.
Airbus is seen as keen for the case to have a definitive conclusion, but a fresh delay spares it from a detailed airing of strategy U-turns and disagreements over the design of its A350 just as its latest jet enters service this year.
However, analysts say it has less to fear from a re-run of past political and personal power battles surrounding the Franco-German group, having radically overhauled its corporate governance and smoothed tensions since the events of 2006.
(Editing by Mark John and James Regan)
By Tim Hepher and Chine Labbé
