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Justice Dept. sues to block airline merger

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US airwaysWASHINGTON — The federal government and other officials are trying to block a planned merger of American Airlines and US Airways — a union that could create the world’s largest airline.

The U.S. Justice Department and attorneys general for six states and the District of Columbia on Tuesday filed a civil antitrust lawsuit challenging the proposed $11 billion merger between US Airways Group Inc. and American Airlines’ parent corporation, AMR Corp.

The merger “would substantially lessen competition for commercial air travel in local markets throughout the United States and result in passengers paying higher airfares and receiving less service,” the Justice Department said in a news release.

US Airways agreed to buy American parent AMR in February. AMR filed for bankruptcy in November 2011, and it was expected to emerge from bankruptcy once the merger was ready to close.

From CNN

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