The detail of the allegations against the Aer Lingus chief executive, Mr Michael Foley, remain unaired.

But protesting innocence after being found guilty of sexually harassing two female staff, Mr Foley took his case to the High Court this week.

He sought an injunction blocking further disciplinary action. It was a gambit that brought him into full-blown legal conflict with his employers - and it failed.

In a brief judgment yesterday, Ms Justice Carroll ruled the balance of convenience of the company's interests "far out weighed" those of Mr Foley. While it was not for the court to decide on the merits of Mr Foley's case, Aer Lingus could not risk trading without a chief executive for a lengthy period if the injunction sought was granted. In circumstances where Mr Foley did succeed in overturning the outcome of the disciplinary process, damages would be an adequate remedy.

In correspondence read to the court, Mr Foley described himself as being "stunned" by the findings of an investigating subcommittee of the airline's board.

Fearing the worst, he believed his dismissal by a separate disciplinary subcommittee was imminent. That subcommittee was given the full authority of the Aer Lingus board to take such action as it deemed necessary in the light of the report into the investigation. Indeed, the subcommittee must make a sanction in line with the guilty finding against Mr Foley, a factor disputed by his legal team this week.

The judgment effectively empowers the subcommittee to continue the disciplinary process although it was still unclear late yesterday when it planned to meet again. This is likely to happen next week.

While the airline is keen to move the process forward quickly, the subcommittee's invitation to Mr Foley to make a written or oral submission still stands. Once its sanction is made, Mr Foley will have the opportunity to seek a full appeal from the board. However, the company's stated view is that he has no such entitlement.

Mr Foley was accompanied in court by his wife Noirin and a number of family members throughout the hearings.

On grounds of natural and constitutional justice, he wants an appeal heard by a body outside the company. He is understood to be "very likely" to take another High Court action to establish his right to such an appeal if none is granted. The company's view was that the future of its chief executive should be determined by its board only. The original investigation was fully compliant and went beyond the entitlements of Mr Foley's contract, which reflected the entirety of his understanding with the company.

The judgment was a significant setback for Mr Foley, who took the highest position at Aer Lingus last September. He had been head hunted by the State airline after leading the US operations of the brewing firm Heineken since 1994.

Mr Foley inherited difficult industrial relations and the airline suffered a spate of damaging pay-related strikes in the months following his arrival. Considerable inter-union rivalry also emerged when most of its cabin crew defected to IMPACT from SIPTU.

In addition, the company's external trading environment turned sour very quickly. The combined impact of the US downturn, foot-and-mouth and the strikes was such that Aer Lingus issued an effective profit warning in March.

It expects profits this year of £15 million (€19.05 million), down from an initial projection of £50 million. In consequence, the company's projection of its notional value has diminished to a minimum of £300 million from a maximum £500 million last year.

All this means the airline was coming under significant commercial pressures when the allegations against Mr Foley surfaced.

The first complaint was made in February by a SIPTU workerdirector, Ms Joan Loughnane. It related to an alleged incident last November.

The second was received in March from an employee in the airline's head office, Ms Anne Lawlor.

The Aer Lingus directors on the investigating subcommittee were Dr John Keane, a Midland Health Board physician, and Ms Rose Hynes, a solicitor who works for AerFi, the former GPA.

Their 62-page report, which remains unpublished, found Mr Foley guilty of sexual harassment in both cases. They said there was no evidence to support Mr Foley's claim that figures within the airline had conspired against him.

This was central to Mr Foley's defence. He told the investigation: "Two people decided to frame me and then someone went public; they fucked me."

Further elements in Mr Foley's defence emerged in his affidavit. He noted Ms Loughnane's complaint in the same month as his conclusion of a negotiation with cabin crew represented by IMPACT, who had left SIPTU.

Another SIPTU worker-director, Mr Willie Clarke, gave Ms Loughnane her "only support" in stating she was "visibly shaken" after the alleged incident.

Mr Clarke was "extremely angry" at Mr Foley's involvement in the negotiation with IMPACT and admitted disliking him from the time of his arrival at the company. Mr Foley also alleged Mr Clarke had a "considerable degree of contact" with the company's former change and restructuring director, Mr John Behan, around the time of Ms Loughnane's complaint.

Mr Foley said: "I had been intimately involved in the decision to terminate [Mr Behan's] contractual arrangement . . . I believe that he bears me considerable ill will. "There was no valid reason connected with work for which Mr Behan and Mr Clarke would have been in contact at this time."

Claims by Mr Foley that the Aer Lingus chairman, Mr Bernie Cahill, had colluded with the investigating subcommittee were rejected in responding affidavits signed by Mr Cahill.

Another claim that Ms Lawlor had been "adamant" in her evidence that her complaint would not have been made but for a conversation she had with Mr Cahill was rejected by Ms Lawlor's solicitor in correspondence opened in court.

When appointed, Mr Foley's primary task was to float the company on the stock exchange, as directed by the Government.

It was not without irony that his case was heard this week as the Government appeared to turn its back on the flotation plan.