The Deal: DOJ Pushes Back Against Call for Speedy Airline Trial
Last week the airlines said the suggested start date was well within the bounds of court practice for merger cases. Their filing included an exhibit showing that most other merger cases go to trial quicker than the roughly six months requested by the DOJ. Anticipating the government's proposed schedule, they derided it as "literally, off the chart."
But the DOJ said the companies' exhibit was "highly selective" and omits a number of merger challenges brought within the last 15 years, including the successful 2011 challenge to AT&T Inc.'s plan to buy T-Mobile USA, which came to trial 166 days after the government's complaint was filed. Two challenges, including a suit against Northwest Airlines Corp.'s 1998 attempt to buy a controlling stake in Continental Airlines Inc., took more than a year to come to trial after the original complaint was filed, the DOJ said.
The government also criticized the air carriers' assertion that the government's merger investigation provided sufficient time to gather the information necessary for trial. "The government's pre-filing investigation is no substitute for full discovery on both the allegations in the complaint and the airlines' defenses," the DOJ said. Post-complaint discovery is particularly necessary as the complaint and defendants' answer frame the issues to be litigated. More time is necessary to conduct economic analysis on efficiency claims, depose witnesses and conduct document discovery, the DOJ said.
The demands of the legal system favor a quick path to trial for the Department of Justice's attempt to block the proposed merger, a fact that could put the government at a disadvantage in the case.Lawyers for the air carriers have requested to begin the trial on Nov. 12, more than three months earlier than the date the government chose. The lawyers said they expect the trial to require 10 court days. If the earlier date is picked, antitrust experts said it will be difficult for the Justice Department to prepare adequately. Which is exactly what the airlines want, antitrust experts said, as they use their huge legal team to try to outgun the constrained staff numbers of the DOJ.
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