Airlines Seek November Court Date For Merger Lawsuit
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DALLAS (CBSDFW.COM/AP) — Fort Worth-based American Airlines and US Airways want a trial in the government’s lawsuit against their proposed merger to start in November, three months sooner than the date picked by federal officials.
The airlines estimated that the trial would last 10 days, meaning that even if they win, the merger won’t close until late this year.
American parent AMR Corp. had hoped to complete the merger and come out of bankruptcy protection in September. It said in a court filing Thursday that the delay is costing AMR $500,000 a day in professional fees such as lawyers’ bills for its bankruptcy case.
The merger was steaming toward final approval this month until the U.S. Justice Department and six states threw up a roadblock. They filed a lawsuit in federal district court in Washington, D.C., to stop the merger, saying it will reduce competition and lead to higher fares and extra fees for consumers. The Justice Department favors a trial starting no sooner than February 10.
The case might never get to trial. The airlines are likely to keep trying to negotiate a settlement that would require concessions — at a minimum, giving up takeoff and landing slots at Reagan National Airport outside Washington — but allow the merger to go ahead. Publicly, however, both sides have sounded as if they’re ready to fight, not talk.
US Airways Group Inc. CEO Doug Parker, who would run the combined company, said in a message to employees Thursday, “We are eager to get to court so that we can make our case and explain exactly how this merger enhances competition across the US and the globe.” Parker also said Thursday that denying the merger would actually hurt customers, by preventing the airline from growing and competing.
Parker and AMR CEO Tom Horton argue that their merger would help consumers by creating a third giant airline roughly the size of United and Delta. The Justice Department argues that it will hurt competition by leaving just four airlines — United, Delta, Southwest and the post-merger American — controlling more than 80 percent of the U.S. air-travel market.
The airlines asked the court for a November 12 trial. The Justice Department hasn’t yet requested a date.
(©2013 CBS Local Media, a division of CBS Radio Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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