The founder of EasyJet Plc, Stelios Haji-loannou, is suing the airline because he claims extra services such as car hire and travel insurance being offered as a way of generating extra revenue, are damaging to the Easy brand. In 2000, EasyJet signed and agreement with EasyGroup, which said that the airline must make at least 75 per cent of sales through airline operations.

According to lawyers for EasyGroup, the courts decision will depend on whether the extra services being offered under the EasyJet name are ancillary or core airline services.

Stelios claims that EasyJet has found itself in the position of having to squeeze revenue out of its customers through extra services because of an ill thought out strategy of expansion over the last decade.

Stelios resigned from the EasyJet board after he failed to see eye-to-eye with other members over expansion plans. The EasyGroup boss still owns around 38 per cent of the airline’s shares. A London court has received papers claiming that car hire, insurance and food are not integral to the EasyJet business. The airline has reacted by saying that such services as well as baggage fees and priority boarding were part of the airline’s main business.

Stelios said that he could not understand where the airline had found the optimism to push for growth at a time when the market suggested it was not a good idea and poor financial returns also indicated that it was probably not the best time to be considering expansion. EasyJet is Europe’s second largest budget carrier after Ryanair.