Suit to stop the Alaska / Virgin merger

Old Sep 10, 16, 3:31 pm
  #1  
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Suit to stop the Alaska / Virgin merger

http://www.travelweekly.com/Travel-N...erica-purchase
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Old Sep 10, 16, 3:41 pm
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Interesting article. I can't seem to find a copy of the legal complaint. Without that, it's tough to discern what legal theories they're using to attempt to block the merger (and then evaluate their merits or likelihood of success).
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Old Sep 11, 16, 10:44 am
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While unlikely to be successful, it's nonetheless rewarding to read, if only it helps in dealing with eventually losing my favorite domestic carrier. Now that time has passed and we've all had a moment to analyzing the merger with less emotion, I don't think AS is going to do it for me.

VX was far and away my preferred carrier for domestic flights, especially with SFO as my home airport.
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Old Sep 12, 16, 3:40 am
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It's overly-brief so I can't really discern a legal theory, and I'm not a lawyer, but basically the argument seems to be going something like this:
-The government generally indicates an interest in fostering competition (particularly via laws such as the Sherman Act, among other ways). This has popped up in some cases, where the gov't has required an airline to break up a hub or divest gates at a few airports due to over-dominance (IIRC UA had to dump some gates at EWR, AA at DCA, etc.) to allow a merger to go through.
-Removing another airline (VX, in this case) would reduce competition without a redeeming benefit to consumers.
--This wouldn't necessarily be a bad thing, but the airline industry is already over-consolidated and it's not like VX was about to collapse, so there was really no reason to allow any further merger.
--VX and AS also have just enough overlap on the West Coast that you'd be pulling out at least some competition of note in several markets within the region.
-Finally, the only reason we're facing the present situation is because of the royal fiasco surrounding SRB's shares at the roll-out.

The hangup, of course, is that VX, AS, and B6 (walk into a bar...) are all a bit under-sized compared to the "big four" (due to the aforementioned mergers), so you can make a case either way in terms of competition (AS+VX has a strong base on the west coast which might well allow it to grow into a "fifth major", and I personally feel that there is/was a case for a three-way tie-up between all three...something which I do expect to stumble out eventually as I frankly think it'll be a cold day in Helena before there's anymore merging "up top": The sorts of slot reallocation you'd have to orchestrate to avoid a hurricane of "lockout hubs" would make the sorts of contortions the Feds tried during the formation of Conrail look straightforward. Honestly, if I'm the Feds I'd be terrified about what would happen if one of the four majors were to start falling apart. On the other hand, AS-VX might be a hair too strong on the West Coast in some respects.

So is there a case against the AS-VX merger? Possibly. Will it prevail? Lord only knows, but it at least has room to muck up the merger. Hell, even if it fails maybe we'll get lucky and this mess will tie the merger up in court for a few years.
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Old Sep 12, 16, 8:13 am
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I'm willing to bet this suit has no impact on the transaction closing...just a little extra work for the lawyers. The competition points raised would be the same as the DoJ would be reviewing anyway, so I doubt it will materially change their course or findings. Expecting to see the transaction close in early to mid October at this rate.
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Old Sep 12, 16, 5:19 pm
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This is nothing but an attempted shake down by a lawyer.

File a last minute lawsuit hoping they pay you to go away so not to delay the close. I don't think there is any legal basis for the suit. But proving that point would take time, so just pay $50 (or what ever the filing fee is) and be a pain in the butt until you get your windfall.

The American legal system at its best.
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Old Sep 12, 16, 8:27 pm
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Originally Posted by aselder View Post
This is nothing but an attempted shake down by a lawyer.

File a last minute lawsuit hoping they pay you to go away so not to delay the close. I don't think there is any legal basis for the suit. But proving that point would take time, so just pay $50 (or what ever the filing fee is) and be a pain in the butt until you get your windfall.

The American legal system at its best.
The filing fee is actually $400, since it was filed in federal court.

http://www.cand.uscourts.gov/courtfees
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Old Sep 12, 16, 8:48 pm
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Originally Posted by GrayAnderson View Post
So is there a case against the AS-VX merger? Possibly. Will it prevail? Lord only knows, but it at least has room to muck up the merger. Hell, even if it fails maybe we'll get lucky and this mess will tie the merger up in court for a few years.
Good luck counting on an ambulance chaser to block the merger

http://aviationblog.dallasnews.com/2...ays-case.html/

San Francisco attorney Joseph Alioto, lead counsel in a private lawsuit challenging the American Airlines-US Airways merger, tells us via email Wednesday afternoon that he will file a request for a temporary restraining order Thursday to block the merger.
How'd that one work out?
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