American Airlines Seeks Names of Opposition in US Airways Merger

Lawyers representing American Airlines and US Airways filed a motion on Tuesday with a federal court insisting that the Department of Justice release the names of individuals they interviewed before filing a motion to block the planned merger of the two airlines.

“Plaintiffs investigated the challenged merger for many months before filing suit, interviewing third parties and gathering information they believe justifies their attempt to block the merger,” noted the motion filed by the airlines.

It is not known publicly or by either airline whether the Department of Justice spoke with individuals with American Airlines, US Airways, a competing airline, or others who does not want the merger to take place.  Nor are the specific facts or opinions known that led the Department of Justice to reach the conclusion that the merger of American Airlines and US Airways would lead to a lack of competition.

Department of Justice Refuses to Answer Many of Airlines’ Discovery Questions

Last week the airlines filed a written set of questions with the Department of Justice as a part of pretrial discovery.  Those questions included ones requesting “the identities of the third parties who plaintiffs interviewed and the factual information those witnesses disclosed.”

In addition, attorneys for American Airlines and US Airways are seeking to understand why the Department of Justice permitted at least four previous airline mergers since 2005, what facts the Department of Justice reviewed to permit those mergers to move forward, and how this merger factually differs.

The airlines noted in their motion that the Department of Justice declined to identify those individuals or the information they provided.  In declining to respond to that question, the Department of Justice noted that information was “protected from discovery and disclosure by the attorney-client privilege, deliberative-process privilege, work product doctrine, law enforcement investigative privilege, common-interest privilege, or any other applicable privilege or doctrine.”

On the matter of the previous mergers, the Department of Justice noted that information “is neither relevant to the subject matter of the lawsuit nor reasonably calculated to lead to the discovery of admissible evidence.”

November Trial Date Set

The Department of Justice and attorneys representing several states filed a lawsuit to block the merger on August 13.  In the lawsuit, the parties claimed the merger would harm airline travelers, as the lack of sufficient competition on hundreds of routes would allow the merged entity to unfairly raise ticket prices.  The airlines have noted that the combined resources of American Airlines and US Airways would actually increase competition for Delta Airlines and United Continental as the merged carriers will have reduced operating costs.

The trial is presently set to begin on November 25.  The Department of Justice had previously asked that the trial be delayed until March 2014.  However, the airlines noted that waiting that long for trial would bring harm to American Airlines and US Airways because of the expenses they would continue to pay separately.

The merger agreement between American Airlines and US Airways originally allowed either airline to terminate the agreement if the merger had not taken place by December 17.  In light of the lawsuit filed by the Department of Justice, both airlines agreed earlier this week to extend the termination date to January 18.

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Mark

Mark has been a contributor to legal web sites related to bankruptcy, tax, and criminal law since 2011. He has an Accounting degree from Texas A&M University.