38 F.Supp.3d 69 (D.D.C. 2014), C. A. 13-cv-1236 (CKK), United States v. US Airways Group, Inc.

Docket Nº:Civil Action 13-cv-1236 (CKK)
Citation:38 F.Supp.3d 69
Opinion Judge:COLLEEN KOLLAR-KOTELLY, UNITED STATES DISTRICT JUDGE.
Party Name:UNITED STATES OF AMERICA, et al., Plaintiffs, v. US AIRWAYS GROUP, INC., et al., Defendants
Attorney:Civil Action No. 13-cv-1236 (CKK) For UNITED STATES OF AMERICA, Plaintiff: Mark William Ryan, LEAD ATTORNEY, Katharine Stevens Mitchell-Tombras, Kathleen Suzanne O'neill, William H. Stallings, Ryan J. Danks, United States Department of Justice, Antitrust Division, Washington, DC; Michael D. Billi...
Case Date:April 25, 2014
Court:United States District Courts, District of Columbia
 
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Page 69

38 F.Supp.3d 69 (D.D.C. 2014)

UNITED STATES OF AMERICA, et al., Plaintiffs,

v.

US AIRWAYS GROUP, INC., et al., Defendants

Civil Action No. 13-cv-1236 (CKK)

United States District Court, D. Columbia

April 25, 2014

Page 70

For UNITED STATES OF AMERICA, Plaintiff: Mark William Ryan, LEAD ATTORNEY, Katharine Stevens Mitchell-Tombras, Kathleen Suzanne O'neill, William H. Stallings, Ryan J. Danks, United States Department of Justice, Antitrust Division, Washington, DC; Michael D. Billiel, LEAD ATTORNEY, U.S. DEPARTMENT OF JUSTICE, Washington, DC.

For STATE OF ARIZONA, Plaintiff: Nancy M. Bonnell, LEAD ATTORNEY, OFFICE OF THE ARIZONA ATTORNEY GENERAL, Phoenix, AZ; Susan V. Myers, OFFICE OF THE ARIZONA ATTORNEY GENERAL, Antitrust Unit, Phoenix, AZ.

For DISTRICT OF COLUMBIA, Plaintiff: Bennett C. Rushkoff, LEAD ATTORNEY, OFFICE OF THE ATTORNEY GENERAL, Public Advocacy Section, Washington, DC; Nicholas Alan Bush, DC OFFICE OF THE ATTORNEY GENERAL, Washington, DC.

For STATE OF FLORIDA, Plaintiff: Lizabeth A. Brady, LEAD ATTORNEY, FLORIDA OFFICE OF THE ATTORNEY GENERAL, Tallahassee, FL; Christopher R. Hunt, OFFICE OF THE FLORIDA ATTORNEY GENERAL, Tallahassee, FL.

For COMMONWEALTH OF PENNSYLVANIA, Plaintiff: James A. Donahue , III, LEAD ATTORNEY, OFFICE OF THE ATTORNEY GENERAL, Antitrust Section, Harrisburg, PA; Jennifer Ann Thomson, OFFICE OF THE ATTORNEY GENERAL, Commonwealth of Pennsylvania, Harrisburg, PA.

For STATE OF TENNESSEE, Plaintiff: Victor J. Domen , Jr., LEAD ATTORNEY, TENNESSEE ATTORNEY GENERAL'S OFFICE, Nashville, TN.

For COMMONWEALTH OF VIRGINIA, Plaintiff: Sarah Oxenham Allen, LEAD ATTORNEY, Matthew Ryan Hull, OFFICE OF THE ATTORNEY GENERAL, Consumer Protection Section, Richmond, VA.

For STATE OF MICHIGAN, Plaintiff: D. J. Pascoe, LEAD ATTORNEY, MICHIGAN DEPARTMENT OF ATTORNEY GENERAL, Corporate Oversight Division, Lansing, MI.

For U.S. AIRWAYS GROUP INC, Defendant: Richard G. Parker, LEAD ATTORNEY, Courtney B. Dyer, Henry C. Thumann, Katrina M. Robson, O'MELVENY & MYERS, LLP, Washington, DC; Steven Gill Bradbury, LEAD ATTORNEY, Gorav Jindal, Paul T. Denis, Paul H. Friedman, DECHERT LLP, Washington, DC; Andrew J. Forman, Charles F Rule, Daniel J. Howley, CADWALADER, WICKERSHAM & TAFT LLP, Washington, DC; Kenneth R. O'Rourke, O'MELVENY & MYERS LLP, Los Angeles, CA.

For AMR CORPORATION, Defendant: John M. Majoras, LEAD ATTORNEY, JONES DAY, Columbus, OH; Mary Jean Moltenbrey, LEAD ATTORNEY, PAUL HASTINGS LLP, Washington, DC; Paula W. Render, LEAD ATTORNEY, JONES DAY, Chicago, IL; Christopher N. Thatch, John Bruce McDonald, Michael S. Fried, JONES DAY, Washington, DC; Rosanna K McCalips, JONES DAY, Business and Tort Litigation, Washington, DC; Scott Mitchell Flicker, PAUL, HASTINGS, JANOFSKY & WALKER, L.L.P., Washington, DC.

For STATE OF OKLAHOMA, Movant: Patrick R. Wyrick, LEAD ATTORNEY, ATTORNEY GENERAL OF OKLAHOMA, Oklahoma City, OK.

For CAROLYN FJORD, KATHERINE ARCELL, KEITH DEAN BRADT, JOSE M. BRITO, ROBERT D. CONWAY, JAN MARIE BROWN, ROSEMARY D'AUGUSTA, BRENDA KAY DAVIS, PAMELA FAUST, DON FREELAND, DONALD FRY, GABRIEL GARAVANIAN, HARRY GARAVANIAN, YVONNE GARDNER, LEE GENTRY, VALARIE JOLLY, GAIL KOSACH, JUDY CRANDELL, MICHAEL C. MALANEY, LEN MARAZZO, LISA MCCARTHY, Movants: Theodore Frank Schwartz, LEAD ATTORNEY, Clayton, MO.

For AMERICAN ANTITRUST INSTITUTE, Movant: Phillip Craig Zane, LEAD ATTORNEY, GEYERGOREY LLP, Washington, DC.

For ALLIED PILOTS ASSOCIATION, Amicus: Filiberto Agusti, Robert Wallace Fleishman, Shannen W. Coffin, LEAD ATTORNEYS, STEPTOE & JOHNSON, L.L.P., Washington, DC; Darin M. Dalmat, Edgar N. James, JAMES & HOFFMAN, P.C., Washington, DC.

For ASSOCIATION OF PROFESSIONAL FLIGHT ATTENDANTS, Amicus: Robert S. Clayman, LEAD ATTORNEY, N. Skelly Harper, GUERRIERI, CLAYMAN, BARTOS & PARCELLI, P.C., Washington, DC.

For ASSOCIATION OF FLIGHT ATTENDANTS-CWA, Amicus: Edward James Gilmartin, LEAD ATTORNEY, ASSOCIATION OF FLIGHT ATTENDANTS-CWA, Washington, DC.

For TRANSPORT WORKERS UNION OF AMERICA, Amicus: Jeffrey Blumenfeld, LEAD ATTORNEY, LOWENSTEIN SANDLER, LLP, Washington, DC; Richard S. Edelman, LEAD ATTORNEY, O'DONNELL, SCHWARTZ, AND ANDERSON, Washington, DC; Sharon L. Levine, LEAD ATTORNEY, PRO HAC VICE, LOWENSTEIN SANDLER LLP, Roseland, NJ.

For OFFICIAL COMMITTEE OF UNSECURED CREDITORS, Amicus: Albert L. Hogan , III, John Wm Butler , Jr., LEAD ATTORNEYS, PRO HAC VICE, SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, Chicago, IL; Gregory Bestor Craig, LEAD ATTORNEY, SKADDEN ARPS SLATE MEAGHER & FLOM LLP, Washington, DC; James A. Keyte, Jay M. Goffman, Kenneth B. Schwartz, LEAD ATTORNEYS, PRO HAC VICE, SKADDEN, ARPS, SLATE, MEAGHER & FLOM, LLP, New York, NY.

For COMMUNICATIONS WORKERS OF AMERICA, AFL-CIO, Amicus: Mary Katherine O'Melveny, LEAD ATTORNEY, COMMUNICATIONS WORKERS OF AMERICA, Legal Department, Washington, DC.

For DALLAS/FORT WORTH INTERNATIONAL AIRPORT BOARD, CITY OF CHARLOTTE - CHARLOTTE DOUGLAS INTERNATIONAL AIRPORT, CITY OF PHILADELPHIA, CITY OF PHOENIX - PHOENIX SKY HARBOR INTERNATIONAL AIRPORT, Amici: David H. Bamberger, LEAD ATTORNEY, DLA PIPER LLP (U.S.), Washington, DC.

For CHARLOTTE CHAMBER OF COMMERCE, CHICAGOLAND CHAMBER OF COMMERCE, DALLAS REGIONAL CHAMBER, FORT WORTH CHAMBER OF COMMERCE, GREATER PHILADELPHIA CHAMBER OF COMMERCE, GREATER PHOENIX CHAMBER OF COMMERCE, Amici: Michael Deuel Sullivan, WILKINSON BARKER KNAUER, LLP, Washington, DC.

For ONEWORLD ALLIANCE, LLC, Amicus: Douglas W. Baruch, LEAD ATTORNEY, FRIED, FRANK, HARRIS, SHRIVER & JACOBSON LLP, Washington, DC.

For U.S. AIRLINE PILOTS ASSOCIATION, Amicus: Kevin Clark Maclay, LEAD ATTORNEY, CAPLIN & DRYSDALE, Washington, DC.

For SOUTHWEST AIRLINES CO., Amicus: Alden Lewis Atkins, LEAD ATTORNEY, VINSON & ELKINS, LLP, Washington, DC.

For VIRGIN AMERICA INC, Amicus: J. Robert Robertson, LEAD ATTORNEY, HOGAN LOVELLS U.S. LLP, Washington, DC.

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MEMORANDUM OPINION

COLLEEN KOLLAR-KOTELLY, UNITED STATES DISTRICT JUDGE.

Presently before the Court is the United States' [161] Motion for Entry of the Proposed Final Judgment. Upon consideration of the pleadings 1, the relevant legal authorities, and the record as a whole, the Court GRANTS the United States' Motion for Entry of the Proposed Final Judgment.

I. BACKGROUND

At the time of the filing of the Complaint in this litigation, Defendant U.S. Airways was a Delaware corporation headquartered in Tempe, Arizona. CIS at 3. In the year 2012, it flew over fifty million passengers to approximately 200 locations worldwide, taking in more than $13 billion in revenue. Id. American Airlines was a Delaware corporation headquartered in Fort Worth, Texas. Id. Defendant AMR Corporation was the parent company of American Airlines. Id. In the year 2012, American flew over eighty million passengers

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to approximately 250 locations worldwide, taking in more than $24 billion in revenue. Id. U.S. Airways and AMR Corporation agreed to merge on February 13, 2013. Id. at 4.

On August 13, 2013, the United States and the States of Arizona, Florida, Tennessee, and Texas, the Commonwealths of Pennsylvania and Virginia, and the District of Columbia filed a civil antitrust Complaint seeking to enjoin the proposed merger of Defendants.2 See Complaint, ECF No. [1]. The initial Complaint, as well as the Amended Complaint 3 filed on September 5, 2013, alleged that the likely effect of this merger would be to lessen competition substantially for the sale of scheduled air passenger service in city pair markets throughout the United States, and in the market for takeoff and landing authorizations (" slots" ) at Ronald Reagan Washington National Airport (" Reagan National" ) in violation of Section 7 of the Clayton Act as amended, 15 U.S.C. § 18. See Am. Compl. ¶ 96. The Court subsequently set a trial date of November 25, 2013. See Order, ECF No. [56].

On November 12, 2013, the parties reached a settlement, and the United States filed a proposed Final Judgment designed to remedy the harm to competition that was likely to result from the proposed merger. The proposed Final Judgment requires the divestiture of slots, gates, and ground facilities at seven airports around the country. CIS at 2-3. Specifically, the Defendants are required to divest or transfer to purchasers approved by the United States, in consultation with the Plaintiff States:

o 104 air carrier slots 4 at Reagan National (i.e., all of American's pre-merger air carrier slots) and rights and interests in any associated gates or other ground facilities, up to the extent such gates and ground facilities were used by Defendants to support the use of the divested slots;

o 34 slots at New York LaGuardia International Airport (" LaGuardia" ) and rights and interests in any associated gates or other ground facilities, up to the extent such gates and ground facilities were used by Defendants to support the use of the divested slots; and o Rights and interests to two airport gates and associated ground facilities at each of the following airports: Chicago O'Hare International Airport (" O'Hare" ), Los Angeles International Airport (" LAX" ), Boston Logan International Airport (" Boston Logan" ), Miami International Airport (" Miami International" ), and Dallas Love Field.

Id. at 2-3. The United States argues that this remedy permits the entry or expansion

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of airlines that can provide meaningful competition in numerous markets, eliminates the significant increase in concentration of slots at Reagan National that otherwise would have occurred, and enhances the ability of low-cost carriers to compete with legacy carriers on a system-wide basis. The subject slots and facilities have been...

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