by Donald Wood
Last updated: 11:06 AM ET, Mon November 21, 2022
The United States Department of Justice said the partnership between American Airlines and JetBlue Airways would "harm travelers" during the closing arguments of the case against the Northeast Alliance.
According to Reuters.com, the Justice Department joined forces with six states and the District of Columbia to claim that the carriers coordinating flights and pooling revenue would be a de facto merger and add nearly $700 million in extra annual costs to travelers.
Justice Department lawyer Bill Jones said the American-JetBlue alliance would allow the airline to raise prices since they wouldn't be competing any longer. With the government working to ensure competition, Jones said the partnership "threatens to do exactly the opposite."
"This is a bad deal for travelers," Jones told Reuters.
American lawyer Daniel Wall said the alliance has made the markets served by the carriers "more competitive than they otherwise were." He also said consumers or the Justice Department could file another lawsuit later if the partnership were proven anti-competitive.
U.S. District Judge Leo Sorokin said he is still sifting through hundreds of pages of evidentiary documentation related to the case, which will take weeks - and he didn't even mention the potential for further delays due to the upcoming holidays later this month and into December.
"The Justice Department has a very good case," Florian Ederer, an antitrust expert and economics professor at Yale University who has followed the matter, told Fortune. "The NEA does harm competition, it probably harms consumers. (American) has eliminated a disruptive competitor, a maverick."
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