Mediation could clear the runway for American-US Airways merger

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by BYRON HARRIS

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WFAA

Posted on October 29, 2013 at 8:20 PM

Updated Tuesday, Oct 29 at 11:20 PM

DALLAS — There may be some give-and-take in the battle between American airlines and the government.

American, US Airways and the Justice Department have agreed on a mediator to resolve an antitrust lawsuit. The government contends the merger of the two carriers is anti-competitive.

So theoretically, the mediation would aim at increasing competition where the two airlines currently fly.

That would include LaGuardia Airport in New York and Reagan Airport in Washington, where US Airways and American have a concentration of landing slots. The airlines could be expected to surrender some of those slots in exchange for dropping the federal lawsuit.

Neither side is disclosing who the mediator is. Former airline executive Mark Drusch says an offer to talk signals weakness in the government's case.

"It's clear that the political pressure is against the DOJ today," he said. "Our own AG [Texas Attorney General Greg Abbott] has finally come out in favor of the deal; we've got the unions that are in favor of it; we've got major cities approving it; there's a lot of pressure on the Obama administration and the DOJ to get this done now, as opposed to people opposing it. So they're standing alone on this. It makes sense for them to try to get the best deal they can and just be done with it."

All of this will happen between now and November 25, when the antitrust trial is scheduled to begin.

E-mail bharris@wfaa.com

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