American Airlines has turned to the Supreme Court to relitigate the Northeast Alliance, a partnership with JetBlue that federal courts ruled as anticompetitive.
Under the alliance, which lasted from 2021 to 2023, American and JetBlue jointly scheduled flights and split revenue on most of their operations out of Boston Logan, Newark, New York LaGuardia and New York JFK airports. The Department of Justice sued to block the Northeast Alliance and was successful. The U.S. District Court in Massachusetts ordered the airlines to dissolve the alliance in May 2023, and American's appeal last November was denied.
In a petition made public Monday, American said the First Circuit Court of Appeals in Boston "killed a valuable collaboration that benefitted air travelers in the congested Northeast." American also said the decision "will chill other collaborations benefitting consumers, including future efforts by airlines to engage in productive collaborations in the notoriously slot-and-gate-constrained Northeast -- and will threaten procompetitive joint ventures outside of the transportation industry more generally."
In the trial court ruling, Judge Leo Sorokin sided with the DOJ, ruling that the alliance harmed competition by turning competitors into partners in New York and Boston. JetBlue opted not to appeal the decision, and American pursued the appeal -- and now a Supreme Court petition -- on its own.
In its appeal, American argued that the trial court ignored benefits that the alliance brought to consumers, such as increasing competition with market leaders Delta and United. However, the appeals court was not swayed.
In its petition to the Supreme Court, American contends that the appeals court's analysis of the competitive effects of the Northeast Alliance was flawed because it looked at the impact of the alliance on a route-by-route level rather than looking at its holistic impact.
"In recent years, antitrust enforcers have set their sights on one deal after another -- all as part of a broader move away from the consumer-welfare standard that has long governed antitrust law," the airline argued.
The Supreme Court's intervention is warranted "to correct the First Circuit's fundamental misunderstanding of this court's joint venture case law and ensure that pro-consumer joint ventures can continue to flourish," American said.
The Supreme Court must now decide whether to take the case.