US Airways Group and American Airlines still plan to close their merger in December, if a U.S. bankruptcy judge signs off on a settlement reached Nov. 12 with the U.S. Justice Department. A hearing is scheduled Monday.
But a federal judge in Washington, who was scheduled to hear the Justice Department's antitrust objections -- before the airlines and regulators reached a settlement -- has set out a timetable stretching into March for making public the terms of the settlement, including publishing in the Federal Register and three newspapers.
The Wednesday order by U.S. District Judge Colleen Kollar-Kotelly sets out procedures to be followed under the Antitrust Procedures and Penalties Act, known as the Tunney Act, which mandates a full airing and period for public input.
Paul T. Denis, antitrust lawyer for US Airways, said the order would not preclude the merger from closing once the airlines get approval from U.S. Bankruptcy Court Judge Sean H. Lane.
"It's essentially a Sunshine Act, providing notice and comment on settlements of Department of Justice antitrust litigations," said Denis, in Washington with the Philadelphia-based firm Dechert L.L.P.
"The Tunney Act does not preclude you from closing. In fact, Judge Kollar-Kotelly entered a stipulated order the day we settled, which cleared the transaction to close," subject to approval by the bankruptcy court overseeing American parent AMR Corp.'s reorganization plan.
"This is the way it works in every merger case," Denis said."We are now cleared to close the merger once Judge Lane signs off. We are still planning to close in December. The notice and comment period runs separate from the closing of the transaction."
Kollar-Kotelly's order Wednesday requires the Justice Department to publish the settlement terms in the Federal Register no later than Dec. 6, and in the Washington Post, Arizona Republic, and Dallas Morning News beginning Monday. (US Airways is based in Phoenix, American in Dallas.) The terms must be published for seven days over a period of two weeks.
Between Dec. 9 and Feb. 7, the public can file comments.
The Justice Department then has 30 more days, until March 10, to post the comments on the Antitrust Division website, file them with the court, and publish them in the Federal Register.
The Justice Department sued in August to block the merger, saying it would reduce competition and raise fares. On Nov. 12, the Justice Department and the airlines announced a settlement, allowing the deal to go forward.
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Original headline: Airline merger still likely next month despite antitrust order
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