US firm sues UK aviation company

UK aviation company BAE Systems is being sued by a US engineering group for cancelling a contract for a new jet, it was reported today.

Honeywell is understood to have filed two writs suing the group.

The row revolves around the group's decision to end the production of civil aircraft due to a slump in demand following the September 11 attacks.

Honeywell had been contracted to make engine and flight guidance parts for the a short-haul passenger jet.

It's understood the group is claiming it has not been paid for developing and manufacturing equipment for the contract.