California, three other states join US bid to stop JetBlue-Spirit merger

California and three other states on Friday joined the U.S. Justice Department lawsuit aimed at preventing JetBlue Airways from buying rival discount carrier Spirit Airlines for $3.8 billion. In addition to California, Maryland, New Jersey, and North Carolina signed on to the lawsuit filed in early March. "We look forward to litigating this important case alongside our state law enforcement partners to stop JetBlue from eliminating its rival, Spirit," Principal Deputy Assistant Attorney General Doha Mekki said in a statement.

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The U.S. Justice Department sued on March 7, seeking to stop the transaction, saying the planned merger "will lead to higher fares and fewer seats, harming millions of consumers on hundreds of routes." JetBlue said on Friday "it’s unfortunate that these states have decided to join the DOJ’s effort to protect the dominant position of the four largest airlines in the U.S." The airline pointed to large airports in the states that sued saying in Newark, United Airlines controls about 70% of the market, and in Charlotte, American Airlines about 90%.

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"Preserving the status quo is the most anti-competitive step that the federal government and these states can take," the airline added. Adding state attorneys general could mean extra staffing for litigation and additional expertise regarding effects on particular states. The lawsuit is the latest attempt by President Joe Biden's administration to push back against further consolidation in industries dominated by large companies.

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Separately, Florida Attorney General Ashley Moody resolved a state probe into the deal after the airlines agreed to increase seat capacity by at least 50% in both Fort Lauderdale and Orlando airports if the merger is completed.

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Source: Reuters

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