A group of employees at bankrupt United Airlines has filed a lawsuit against the company's employee stock ownership plan and its trustees.

They are claiming those charged with protecting their interests failed in their duties, costing employee-owners billions of dollars.

The suit alleges that the UAL ESOP committee - all employees of UAL - was not objective in its decision to hold the company's stock as it plummeted in value even before the September 11, 2001 terrorist attack, which further weakened the stock price.

The stock was trading in the high 30s in January 2001 and today trades at under USD$1.50 a share.

The proposed class-action lawsuit, filed in a Chicago court, seeks to represent thousands of employees who are or were participants or beneficiaries of the stock scheme as of July 19, 2001.

According to the complaint, the plan trustees fell short of their duty when they failed to move holdings to less risky, more appropriate investments and also failed to disclose that the stock was an imprudent investment.

The suit claims that UAL was in deep financial difficulty well before the September 11 attack, and the plan trustees ignored the warning signs, including grim forecasts by the UAL leadership.

The UAL Employee Stock Ownership Plan was formed in 1994 as a vehicle to recapitalize the airline. Employees invested several billion dollars in exchange for 55 percent ownership in United. The employees also gave the company significant wage and benefit concessions as part of the package.