A federal judge in Boston ruled Friday that a northeast “alliance” between American Airlines and JetBlue must end, siding with government lawyers who argued the partnership would further consolidate the airline industry and harm air travelers.
The ruling hands a major win to the Biden administration’s Department of Justice, which originally sued to block the so-called Northeast Alliance between the two airlines in September 2021. That proposed deal saw American Airlines and JetBlue coordinate closely on flight operations in Boston and New York.
Judge Leo Sorokin said the Northeast Alliance “substantially diminishes competition in the domestic market for air travel.”
“It does so by combining the Boston and New York operations of two airlines that are among the most significant competitors in that region,” Sorokin wrote in a 94-page ruling. “These two powerful carriers act as one entity in the northeast, allocating markets between them and replacing full-throated competition with broad cooperation.”
The decision came after a month-long trial in the fall of 2022 at a federal courthouse in Boston where lawyers for the two airlines argued the government could not prove that the American Airlines-JetBlue agreement resulted in higher costs for travelers.
U.S. Attorney General Merrick Garland said Sorokin’s ruling was a “win for Americans who rely on competition between airlines to travel affordably.”
Spokespeople for American Airlines and JetBlue said they were considering an appeal.
“We believe the decision is wrong and are considering next steps,” an American Airlines spokesperson said. “The court’s legal analysis is plainly incorrect and unprecedented for a joint venture like the Northeast Alliance. There was no evidence in the record of any consumer harm from the partnership.”
A JetBlue spokesperson said the company “made it clear at trial that the Northeast Alliance has been a huge win for customers.”
The deal had already been in place for about a year and a half by the time the case went to trial.
American Airlines and JetBlue argued the agreement would gin up more competition against other rival airlines in the northeast — mainly Delta and United Airlines — and allow the pair to offer more routes to customers.
But Sorokin thought otherwise, writing in the Friday ruling that the agreement was “no minor shift for the two businesses or the region.”
Nearly three-quarters of JetBlue’s overall operations or flights in or out of the Northeast Alliance area. American is the third-largest carrier operating out of Boston’s Logan International Airport, and the airline counts New York as a major hub.
JetBlue and American competed “vigorously” on everything from fares to customer amenities, Sorokin said.
“The [Northeast Alliance] changes all of that. It makes the two airlines partners, each having a substantial interest in the success of their joint and individual efforts, instead of vigorous, arms-length rivals regularly challenging each other in the marketplace of competition,” the judge wrote.
Materials from the Associated Press were used in this report.