Judge Blocks JetBlue-Spirit Merger
A federal judge has blocked JetBlue Airways from buying Spirit Airlines after the Justice Department sued to stop the merger. The judge agreed with the DOJ that the $3.8 billion deal would reduce competition.
JetBlue had argued that the deal would help consumers by making JetBlue a stronger competitor against bigger rivals that dominate the U.S. air-travel market.
In a court filing Tuesday, U.S. District Judge William Young said the acquisition, which would have made JetBlue the fifth-largest airline, would “substantially lessen competition” in violation of the Clayton Act, which “was designed to prevent anticompetitive harms for consumers.”
The judge noted that while the merger might make JetBlue more competitive against other major domestic airlines, it would also eliminate JetBlue’s toughest competition Spirit. The latter is the country’s biggest low-cost airline.
Years of previous consolidation in the industry have put United, Delta, American and Southwest in control of about three-quarters of domestic market.
This is the second major setback for JetBlue in federal court in less than a year. Another judge in the same Boston courthouse ended a partnership in the Northeast between JetBlue and American Airlines.
Leave a Reply