The U.S. DoJ challenges an acquisition in the air transport sector (US Airways / American Airlines)

On August 13, 2013 the U.S. Department of Justice (DOJ), six states, and the District of Columbia filed suit against US Airways Group, Inc. (US Airways) and AMR Corporation (American) alleging that the defendants’ proposed merger violates Section 7 of the Clayton Act [1]. This marks the first time that the DOJ and the states have sought to block an airline merger since 2001, when they threatened to file suit to block United Airlines’ bid to acquire US Airways [2]. The complaint alleges that the transaction will increase the likelihood of reduced service and increased fares in a market that is already highly concentrated. The DOJ alleges the transaction will cause harm in two types of relevant markets: (1) city pair markets (i.e., “routes”) on which US Airways and American offer competing