DoJ Case vs. American and JetBlue Alliance closes this week

The Department of Justice’s lawsuit against the American Airlines/JetBlue Airways Northeast Alliance came to a close this week, with vastly different closing arguments in federal court in Boston.

The DOJ, along with six states, filed suit against the two airlines claiming the Alliance was a monopoly set up in two of the biggest markets in the country in Boston and New York. The Northeast Alliance was set up to share schedules and revenue on flights into and out of those lucrative markets, the airlines say. That constitutes a monopoly, the DOJ says, which will end up costing consumers more in the long run without having competition for routes.

The case is being closely watched on several fronts. It is considered something of a challenge to the Biden Administration’s stance on big business and antitrust laws, while at the same time challenging airline mergers – and JetBlue has a big one on the table with Spirit Airlines that still needs regulatory approval.

“It is a very important case to us … because of those families that need to travel and want affordable tickets and good service,” Justice lawyer Bill Jones said at closing arguments of the Alliance trial on Friday, according to Fortune Magazine.

But in the nearly two months the trial has been going on, the government still hasn’t shown an example of how the Northeast Alliance has hurt consumers or constituted a monopoly, airline lawyers said.

“It’s all just an idea,” said Daniel Wall, a lawyer for American.

But this isn’t television or movie drama, so don’t expect an imminent decision from U.S. District Judge Leo Sorokin. The judge said he is still sifting through ‘hundreds of pages’ of evidentiary documentation related to the case, and that will take weeks – and he didn’t even mention the potential for further delays due to the upcoming holidays later this month and into December.

“The Justice Department has a very good case,” Florian Ederer, an antitrust expert and economics professor at Yale University who has followed the matter, told Fortune. “The NEA does harm competition, it probably harms consumers. (American) has eliminated a disruptive competitor, a maverick.”