The Justice Department heads to court in Boston on Tuesday in hopes of undoing a year-and-a-half-old pact between American Airlines and JetBlue Airways in the Northeast U.S.
The carriers argue the deal allows them to better compete against larger airlines. But the Biden administration contends the agreement is effectively a merger that will drive up fares. Last September, the Justice Department along with the attorneys general of six states and the District of Columbia sued to block the partnership, which was approved in the final days of the Trump administration.
The antitrust trial will be a test for President Joe Biden’s Justice Department, which has been tasked with taking a hard stance against threats to competition.
However, the antitrust push has run into obstacles. Earlier this month, a federal judge denied the Justice Department’s bid to block UnitedHealth’s acquisition of Change Healthcare. Last week, another federal judge rejected the DOJ’s bid to stop a merger between two major U.S. sugar refiners.
An American Airlines plane lands on a runway near a parked JetBlue plane at the Fort Lauderdale-Hollywood International Airport on July 16, 2020 in Fort Lauderdale, Florida.
Joe Raedle | Getty Images
The trial against the airline alliance comes as JetBlue is in the process of trying to acquire discount carrier Spirit Airlines for $3.8 billion to create the country’s fifth-largest airline, a deal that faces a high hurdle with regulators, though that partnership isn’t a part of the lawsuit.
JetBlue, a quirky New York-based airline, identifies as a low-cost carrier but also offers high-end products like its premium Mint class, and last year launched flights to London from New York and Boston. The carrier has turned to partnerships and now a potential acquisition to grow.
“I think what we’ve seen through this and through the Spirit merger is management believes they have a challenge to scale growth and they view the pace of organic growth as too slow,” said Samuel…
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