Countdown begins to U.S. airline merger trial in November

Fri Aug 30, 2013 6:03pm EDT
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By David Ingram and Diane Bartz

WASHINGTON (Reuters) - American Airlines and US Airways voiced a fresh sense of optimism on Friday after a U.S. judge granted their request for a speedy trial to determine whether the two carriers are allowed to form the world's largest airline.

U.S. District Judge Colleen Kollar-Kotelly said a trial pitting the airlines against the U.S. Justice Department and several states would begin on Monday, November 25.

The trial date is close to what the airlines wanted and months earlier than the Justice Department had hoped, meaning the government will need to work faster than it thought if it hopes to succeed in blocking the $11 billion merger.

Both airline stocks got a boost from the news. US Airways Group Inc LCC.N shares closed up 1.3 percent at $16.16 in New York Stock Exchange trading, against a lower market. Shares of AMR Corp AAMRQ.PK, American's parent, were up 4.4 percent at $3.54 in thin over-the-counter trading.

"We are confident in our case and eager to get to court," the airlines said in a joint statement. "We are pleased to have a trial date that will enable us to resolve this litigation in a reasonable time frame."

Justice Department spokesman Peter Carr said in a statement: "We appreciate the court's careful consideration of the scheduling issues and will be ready to present our case."

The Justice Department sued on August 13 to block the deal, saying it would lead to higher prices for customers, while the companies said it would make them more competitive and strengthen the market.

Barring a settlement, which both sides said they are open to, lawyers will spend the next three months in intense preparation that will involve most of the U.S. commercial airline industry.   Continued...

An American Airlines jet takes off while U.S. Airways jets are lined up at Reagan National Airport in Washington July 12, 2013. REUTERS/Larry Downing