No Fly Suit Against US Airways-AMR Merger

San Francisco antitrust lawyers weighed in with their own suit challenging the $11 billion merger of US Airways and American Airlines, piggybacking on a suit by 18 state attorneys general filed last week.

US Airways was named in an antitrust action filed July 2 in California’s San Francisco-based Northern District federal court by Joseph M. Alioto challenging the planned American and US Air merger as “anticompetitive” and said it would “tend to create a monopoly” in the airline industry.

On the same day, 18 state attorneys general led by Texas sued in the U.S. Bankruptcy Court in Manhattan.  American is in bankruptcy reorganization and it is asking the judge to confirm its plan to exit bankruptcy that would include the US Air merger.

The U.S. Justice Department is also investigating the merger plan.

The airlines announced in February they reached a merger agreement in an all stock transaction valued at $11 billion, which would create the world’s largest airline, surpassing United Airlines.

San Francisco Lawsuit

The lawsuit filed by Alioto represents 39 consumers who buy airline tickets from the airline.

The suit contends the potential anticompetitive effects of the merger could be price increases, elimination of routes, curtailed services and reduced capacity.

The lawsuit seeks an order to block the merger.

Case:  Fjord v. US Airways, No. C13-3041SBA