Coverage of the merger between American Airlines and US Airways

American Airlines, US Airways Seek Nov. Court Date for Merger Lawsuit

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    NEWSLETTERS

    NBC 5 News

    American Airlines and US Airways are asking for a November trial to settle the government's lawsuit against their proposed merger, three months earlier than the date picked by federal officials.

    The airlines filed a motion Thursday to set a trial date in federal district court in Washington, D.C. for Nov. 12.

    In the filing, the companies said the requested date is reasonable by historic standards and that the Department of Justice's request of a trial in 180 days is unreasonable with one of the companies in bankruptcy.

    The airlines estimated that the trial would last 10 days, meaning that, even if they win, the merger would not close until late this year.

    The case might never get to trial. The airlines are likely to keep trying to negotiate a settlement that would require concessions -- at a minimum, giving up takeoff and landing slots at Reagan National Airport outside Washington -- but allow the merger to go ahead. Publicly, however, both sides have sounded as if they're ready to fight, not talk.

    American parent, Fort Worth-based AMR Corp. had hoped to complete the merger and come out of bankruptcy protection in September. It said in a court filing Thursday that the delay is costing AMR $500,000 a day in professional fees such as lawyers' bills for its bankruptcy case.

    Lawyers for the airlines noted that either company can back out of the merger if regulators don't approve it by Dec. 13. They said delaying the trial past that date would cause "even greater uncertainty" for employees and customers. Morale is already suffering, they said.

    The merger was steaming toward final approval this month when the U.S. Justice Department and six states, including Texas, threw up a roadblock. They are suing to stop the merger, saying it will reduce competition and lead to higher fares and extra fees for consumers.

    Executives for American and US Airways disagreed with the assertion and said they looked forward to their time in court to show how the merger makes the industry more competitive and that the combined airline would prevent the remaining four large, merged airlines from controlling 80 percent of the U.S. air-travel market.

    “We are eager to show that the DOJ’s action would deny millions of customers access to a more competitive airline that will offer customers what they want, delivering significant benefits to consumers, communities and employees,” said Doug Parker, Chairman and CEO, US Airways, incoming CEO of the combined company. “The new American Airlines is predicated on growth. This merger is the foundation of American’s plan to exit bankruptcy and is the cornerstone of American’s and US Airways’ plan to form a more competitive and cost-effective airline to take on the country’s largest air carriers – Delta, United Airlines, and Southwest – and a number of fast-growing low-cost carriers, including Virgin America, JetBlue, Spirit, and Allegiant.”

    In a letter to employees on Thursday, American Airlines CEO Tom Horton said the federal judge overseeing the case will ultimately decide on the trial date.


    American Airlines Merger:
    Complete coverage of the merger between American Airlines and US Airways into the newly-formed Fort Worth-based company, American Airlines Group (AAL). Click here for more.