Topline
A federal judge rejected a partnership between American Airlines and budget airline JetBlue on Friday in a blow to the three-year-old partnership between the two airline giants, marking the latest federal antitrust win for the Biden Administration, which is also pursuing legal action to block a proposed Spirit Airlines and JetBlue merger.
A federal judge ruled against a partnership between JetBlue and American Airlines on Friday.
Key Facts
A federal judge in Boston ruled in favor of the Department of Justice, which filed an antitrust suit to undo the partnership, ruling it suppressed competition, the Wall Street Journal reported
The DOJ, along with six states attorneys general and Washington D.C., argued the partnership—which the two airlines agreed to in 2020 to work in collaboration in four northeast airports, including three in the New York City area—would drive up the price of flights.
Forbes has reached out to JetBlue and American Airlines for comment.
Key Background
JetBlue and American Airlines formed the Northeast Alliance with the authorization of the Department of Transportation in 2020 in what the companies asserted was an effort to “increase competition” and “overcome the insurmountable obstacles” presented by Delta and United Airlines’ “dominance” in New York and at Boston’s Logan International Airport.
Tangent
Federal prosecutors filed another antitrust lawsuit against JetBlue in March to block its $3.8 billion proposed merger with Spirit Airlines—a merger that would make the airline the fifth biggest airline in the country. In the suit—the latest blow for Spirit, which canceled its proposed merger with Frontier Airlines last July—prosecutors argued the merger would “eliminate the unique competition” provided by Spirit, which is known for low-cost pricing and simple in-flight amenities. JetBlue still hopes to close its acquisition of Spirit early next year, a company spokesperson told Forbes.
Further Reading
Feds File Antitrust Suit Against JetBlue Over Spirit Merger—Putting $3.8 Billion Deal In Jeopardy (Forbes)
Spirit And Frontier Airlines Cancel Merger Plans—Opening Door For JetBlue’s Offer (Forbes)
Source: https://www.forbes.com/sites/brianbushard/2023/05/19/jetblue-american-airlines-partnership-rejected-judge-rules/