An internal battle for control of Hong Kong Airlines has intensified in the courts. Lawyers for Hou Wei, listed on the airline's website as chairman, and Sun Jianfeng, appointed chief executive in May, lodged a demand on June 5 for HKD95 million dollar (USD12.2 million) in damages if a court rules in their favour against Zhong Guosong, who also claims to be chairman, the South China Morning Post has reported.

The tussle at Hong Kong's High Court is over an injunction order sought by Zhong, who one group of shareholders appointed as chairman in April, to stop Hou, backed by the Chinese conglomerate HNA Group, from interfering with the company. HNA has a stake of around 29% in the carrier.

Zhong owns around 27% through his Hong Kong Airlines Consultation Services, while an ally, Frontier Investment Partner, held 34% - until April 11 when it sold its stake to a little-known Hong Kong-based third party, Grand City Capital Investment, threatening Zhong’s position.

Zhong has disputed whether this latter sale was valid. A two-day trial will start from August 22 to determine this point, as well as whether it was correct for Zhong to impose an injunction order, which remains in place, on Hou, Sun and fellow director Wang Liya from making decisions at the airline beyond normal business operations.

If the HKD95mn damages are awarded, however, they are unlikely to hurt Zhong personally as the injunction lawsuit was filed under the name of Hong Kong Airlines, according to the South China Morning Post.

The court has also been asked to rule, in a parallel case, on which party is the airline's true major shareholder.

Meanwhile, also on June 5, ongoing financial problems at the carrier prompted Frank Chan Fan, secretary for transport and housing, to tell the Air Transport Licensing Authority (ATLA), a statutory body with the power to shut airlines down and approve new ones, that he was “highly concerned” about Hong Kong Airlines’s finances. ATLA has asked the carrier to outline a plan for improvement, or it would take appropriate action.