Settlement best avenue for American, US Airways merger

Posted Wednesday, Oct. 30, 2013  comments  Print Reprints

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American Airlines CEO Tom Horton had encouraging words Tuesday in New York when he spoke about the possibility of settling a Justice Department antitrust suit blocking American’s proposed merger with US Airways.

The three parties agreed Monday to meet with a mediator. The case is scheduled to go to trial Nov. 25 if those talks fail.

“It’s incumbent on us to make a very strong case and be ready to help bring about a sensible settlement,” Horton told Bloomberg News. “I think there’s a way to do that.”

He didn’t elaborate, but he said, “We’re hopeful.”

Hopeful indeed. A pretrial settlement would be a terrific outcome for the two airlines and the Justice Department.

This month, the mayors of seven large cities served by the two carriers sent a letter urging the department to “reconsider this ill-conceived lawsuit.”

Signers of the letter include Fort Worth Mayor Betsy Price, Dallas Mayor Mike Rawlings and Chicago Mayor Rahm Emanuel.

Citing similar opinions from unions representing American and US Airlines employees, the mayors asked Attorney General Eric Holder to “settle your lawsuit with American Airlines and US Airways and allow the combination to proceed.”

Four major airports dominated by the airlines, including Dallas/Fort Worth Airport, have been granted permission to file court briefs supporting the merger. The airlines say they’ve also received support from 183 members of Congress and 26 state and local chambers of commerce.

That’s very impressive encouragement.

Still, it would be naive to believe that the Justice Department would simply walk away. The suit, filed in August by the department’s antitrust division, included extensive allegations of bad behavior in the airline industry that the suit said harms consumers.

All sides have had time to take depositions, interview executives of other airlines under oath and assess the evidence they would be able to present during a trial.

This is the time for a settlement under which a strong, merged airline can move forward.

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