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American and US Airways Raise Fervor Over Anticipated Merger, are Sued

 

American Airlines and US Airways are planning a colossal merger that would combine the two the largest air traffic carriers in the world. Some are nervous, and one agency, led by antitrust lawyer Joseph Alioto, is filing an antitrust suit. He has filed his suit in a San Francisco district court, representing 40 customers who are concerned the merger would reduce the number of airlines to four, including United, Delta, Southwest, and the swollen American, and cause fewer flights of lower quality.

 

The Department of Justice is also concerned, claiming that the airline would be too dominant in Reagan National Airport, near Washington D.C., and has suggested the airlines sell off some slots to avoid a monopoly there, something the airlines regard as non-negotiable.



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Meanwhile, American Airlines spokesman Mike Trevino called the lawsuit “baseless” according to the Associated Press, and US Airways spokesmen Ed Steward explained away the suit as reactionary: “As is often the case with high-profile mergers, lawsuits containing baseless allegations such a these are filed and they are successfully defended.”

 

That at least was the case when Alioto sued Southwest Airlines Co over their acquisition of AirTran Airways, at which point Alioto had to pay $67,495  to cover the court costs.

 

The merger is anticipated to close in the third quarter.

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Daniel June Posted by on July 3, 2013. Filed under Business News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.