Holder: Airline merger settlement talks ‘ongoing’

Attorney General Eric Holder said this week that conversations about a potential settlement in the Justice Department’s lawsuit to block a proposed merger between U.S. Airways and American Airlines are “ongoing.”

The Justice Department has sued to block the proposed combination of the airlines because it argues that their merger would violate federal anti-trust laws.

Holder said this week that he has been “in touch with the — the industry — the airlines that we have, we've sued.”

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“We've expressed concerns about the potential reduction in competition that the merger would potentially impose,” Holder said earlier this week during a news conference on an unrelated topic. “I'm not going to go into any detail with regard to the discussions that we are engaging in, but I will say that ... they are ongoing.”

Holder said the key to any deal between the Justice Department and the airlines would likely require U.S. Air and American to give up some of their flights at airports such as Washington, D.C.’s Ronald Reagan National Airport, where landing rights are monitored by the federal government to control airplane traffic flow.

“What we have tried to focus on is to make sure that any resolution in this case necessarily included divestitures of facilities at key constrained airports throughout the United States,” Holder said. “That, for us, is something that has to be a part of any resolution.”

The Justice Department has argued that the U.S. Air-American merger would result in higher prices for airline passengers because the airlines currently offer flights to many similar destinations.

The companies have countered that less than 10 of their regular non-stop routes are identical, though Justice has argued that flights with layovers should also be counted.

Holder said this week he was hopeful that that a deal could be reached before the scheduled opening of the trial over the DOJ’s lawsuit to block the U.S.-American merger on Nov. 25.

“As I said, the conversations are ongoing,” Holder said. “And we hope that we will be able to resolve this short of trial. But if we do not meet those demands that we have, we are fully prepared ... to take this case to trial.”