American Airlines Appeals Major Antitrust Decision

American Airlines and JetBlue coordinated schedules, shared revenue, and offered reciprocal benefits to frequent flyers for nearly four years. Then, last May, a federal district court called their ”Northeast Alliance” a violation of antitrust law, and ordered them to stop collaborating. On Sept. 25 American announced that it is appealing, as reported in FlightGlobal.

There is no hope of reviving the alliance. JetBlue complied with the ruling, announced it would not appeal, and began the process of acquiring Spirit Airlines, a deal the airline characterized as “the best and most effective opportunity to truly transform the competitive landscape” in the USA. The DOJ opposed that merger as well, and a trial is set for October.

The May ruling was a big victory for the Biden administration, which has used the antitrust laws to fight against mergers and other arrangements between large corporations that it calls anti-competitive. The DOJ argued that the Northeast Alliance cost consumers hundreds of millions of dollars every year. U.S. District Judge Leo Sorokin agreed. He wrote that American and JetBlue “replaced full-throated competition with broad cooperation,” in violation of antitrust law. According to his ruling, the defendant airlines offered little in the way of evidence that there would be any benefit to consumers.

American said all along it would appeal. Its spokesman called the decision wrong. “The court’s legal analysis is plainly incorrect and unprecedented for a joint venture like the Northeast Alliance,” he said. “There was no evidence in the record of any consumer harm from the partnership.”