Last Tuesday, the US Department of Justice, the District of Columbia and six state attorneys general filed an anti-trust lawsuit against the proposed merger of US Airways Group Inc and American Airlines. On the other hand, the airlines argued that the merger would result to an increased viable competition in the industry. This is because the deal would incept the biggest airline in the world and would fight with two megacompetitors, United Continnental and Delta, which were also formed from megers.
US Airways and American Airlines vowed determination last Wednesday for the completion of the said deal which was expected to close next month. The lawsuit filed in a federal court in Washington DC would also delay the final approval of AMR Corp's bankruptcy exit plan. AMR is the parent company of American Airlines.
Lawyers, who were not connected with the anti-trust lawsuit, said that that government has a strong take on the case. Regulators argued that the merger of US Airways and AA would decrease the number of US airlines in the market to three. The government added that the move was redoing past practices that showed "increasingly prefer tacit coordination over full-throated competition."
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