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Updated Dec 6, 2013 - 3:54 pm

NY judge refuses to block US Airways merger

NEW YORK — A judge refused to block a merger between American Airlines and
US Airways on Friday, saying a bankruptcy judge correctly rejected arguments
made by a lawyer for some consumers.

San Francisco attorney Joseph Alioto argued that the deal would harm fliers
because it would result in less competition and higher prices. But U.S. District
Judge Loretta Preska repeatedly noted that his arguments relied on outdated
facts, had no evidence to support them and sometimes made no sense.

“There is nothing in the record from which I can make a finding that your
clients are likely to be irreparably injured _ personally,” she said.

American is owned by AMR Corp. and is based in Fort Worth, Texas. The company
has said it plans to complete the merger with Tempe, Ariz.-based US Airways on
Monday.

Preska said a federal bankruptcy judge was “correct in all respects” in
deciding last week to let the merger proceed. She also refused to stay the
effect of her ruling while Alioto appeals to the 2nd U.S. Circuit Court of
Appeals.

Alioto complained Friday to Preska that he’d gotten “the bum’s rush, with all
due respect, by the bankruptcy court.”

Preska said Alioto had failed to show consumers would suffer irreparable harm
or that he was likely to succeed in his effort to temporarily block the merger
until a trial could be conducted on his antitrust lawsuit. Lane said last week
that even if Alioto won his lawsuit, he could demand additional divestitures by
the two airlines but could not wreck the merger.

Alioto’s case lacked proof, said Attorney Dan Wall for US Airways Group Inc.
“We’re here on just attorney argument and rhetoric,” he said.

The merger means American, United, Delta and Southwest will control more than
80 percent of the U.S. market. A series of mergers in the industry since 2005
has reduced nine big airlines to four.

In August, the Justice Department had sued to block the merger, saying it would
hurt competition and produce higher prices. But regulators settled their case in
exchange for the airlines’ promise to surrender some coveted landing rights at
Reagan National near Washington and LaGuardia in New York and a few gates at
five other airports.

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