Judge calls early trial on U.S. lawsuit to block airline merger

An American Airlines jet pulls into a gate next to a US Airways plane at Reagan National Airport in Washington. The Justice Department wanted more time to prepare its case.
An American Airlines jet pulls into a gate next to a US Airways plane at Reagan National Airport in Washington. The Justice Department wanted more time to prepare its case. (ANDREW HARRER / Bloomberg)
Posted: September 01, 2013

A federal judge in Washington said Friday the Justice Department lawsuit seeking to block the merger of US Airways Group and American Airlines would go to trial Nov. 25, a date the airlines wanted.

The government had pushed for the trial to start March 1, saying more time was needed to prepare its case. The airlines said a lengthy delay could kill their merger.

U.S. District Judge Colleen Kollar-Kotelly listened to both sides in court Friday and agreed that March was too far off.

The airlines were poised to complete a merger, creating the world's largest airline, when the Justice Department Antitrust Division and six states, including Pennsylvania, sued Aug. 13 to block it. The regulators said that it would stifle competition and lead to higher fares and that the combination would dominate more than 1,000 routes nationwide.

The lawsuit came as a surprise after American's creditors, shareholders of both companies, the airlines' employees, and European Union regulators had signed off on the deal.

The companies contend their merger would benefit consumers by creating another big competitor to United, Delta, and Southwest airlines. They also cite competition from other low-cost carriers, including JetBlue, Alaska, Spirit, and Frontier airlines. "We are pleased the court has set a schedule that will enable us to resolve this litigation in a reasonable time frame," American CEO Tom Horton and US Airways CEO Doug Parker said in a joint letter to employees. "We are more committed than ever to bringing our airlines together and look forward to making our case for the new American in court."

Some analysts expect the airlines to prevail.

A federal bankruptcy judge in New York said Thursday he was inclined to approve AMR Corp.'s plan for emerging from bankruptcy, which includes the merger. He said he would decide by Sept. 12 or sooner.

Unions for US Airways and American's flight attendants applauded Judge Kollar-Kotelly's decision to expedite the trial. "We are optimistic that the judge will agree that the benefits of this merger, for both workers and consumers alike, will help create a stronger aviation system," said US Airways flight attendants' president Roger Holmin.


Contact Linda Loyd at 215-854-2831 or lloyd@phillynews.com.

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