Scheduling conflict in airline antitrust case has serious implications

Aug. 24, 2013 at 1:31 PM
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WASHINGTON, Aug. 24 (UPI) -- Two U.S. airlines, US Airways Group and American Airlines, said that a contracted escape clause could derail a merger if an antitrust trial is not begun soon.

The airlines have requested a start date of Nov. 10 for a lawsuit intended to stop the merger based on antitrust issues filed by the U.S. Justice Department.

The Wall Street Journal reported Saturday that four unions have filed a brief supporting the Nov. 10 start date.

The airlines argue that the merger, which the Justice Department opposes, includes a contracted agreement that either party can back out if regulatory issues are not resolved by Dec. 13, The Wall Street Journal reported Saturday.

The Justice Department has requested the trial begin Feb. 10, but the judge assigned to the case, U.S. District Judge Colleen Kollar-Kotelly in Washington has informed both parties that she has a criminal trial already scheduled to begin on Jan. 14.

The criminal case is expected to last six to eight weeks, the Journal said.

To resolve the scheduling conflict, Kollar-Kotelly has ordered an office conference for Friday of next week.

A delayed trial also has immediate implications for AMR's bankruptcy case in New York.

AMR, the holding company that owns American Airlines, filed papers in its bankruptcy case to approve of its bankruptcy exit plan, which is largely based on a successful merger with US Airways.

If the merger is stopped, AMR would have to start almost from scratch to come up with a new reorganization plan, the Journal reported.

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