Airlines ‘looking forward to their day in court’ in merger suit, lawyers say

“Certainly there are any number of combinations of connecting flights that could theoretically compete, but that’s true of any transaction in the airline industry,” Sims said. “Certainly it was true of transactions in the airline industry in the [recent] past.”

The proposed US Airways-American merger follows previous combinations by Delta and Northwest Airlines, United and Continental Airlines and Southwest and AirTran Airways, all since 2008.

The airlines, which are currently the nation’s fourth and fifth largest
carriers, announced earlier this year that they would combine forces in
an $11 billion deal. 

The agency said on Tuesday that it was stepping in to attempt to block the U.S. Air-American merger to protect airline passengers from higher flight prices, however.

“This transaction would result in consumers paying the price — in higher airfares, higher fees and fewer choices,” Attorney General Eric Holder said. “Today’s action proves our determination to fight for the best interests of consumers by ensuring robust competition in the marketplace.”

U.S. Airways attorney Rich Parker said on Wednesday that the companies “are looking forward to their day in court.”

“In the United States, only a federal judge can stop a merger,” Parker said. “DOJ cannot stop a merger; they can only ask a judge to agree with its argument.”
Parker said the DOJ’s argument misrepresented the details of the proposed merger between U.S. Air and American.

“Number 4 and number 5 are combining forces to create a network comparable to United and Delta, repairing flaws in the [route] structures of American and U.S. Airways,” Parker said. “One would get the impression from this complaint that this is an industry in which people are coordinating on price and not competing. The evidence at trial is going to show that this is industry that extremely difficult to coordinate because prices are changing everyday.”

The companies have said they would become the largest U.S. airline if they are allowed to proceed with their merger.