In a significant blow to American Airlines, the U.S. Supreme Court announced on Monday it will not hear the carrier’s appeal over its Northeast Alliance with JetBlue Airways. The decision puts a definitive end to a partnership that American once considered vital to competing in the Northeast United States.
Supreme Court Kills American Airlines’ Northeast Alliance With JetBlue
The Northeast Alliance (NEA), launched in 2021, allowed American and JetBlue to coordinate flights and schedules out of Boston and New York City area airports. It was pitched as a way for the two carriers to better compete against United and Delta in two of the country’s most congested air markets. But the U.S. Department of Justice (DOJ) disagreed, calling the partnership anti-competitive and a “de facto merger.” A federal judge sided with the DOJ in May 2023, and JetBlue dropped out of the agreement shortly after. American pressed on alone with its appeal, first to the 1st Circuit Court of Appeals and later to the Supreme Court, which on Monday denied certiorari (meaning it refused to hear the case). Justice Brett Kavanaugh indicated he would have taken up the case.
By declining to hear the case, the Supreme Court has left the lower court ruling intact. That means the alliance must remain dismantled. In a statement following the ruling, American Airlines said it was “disappointed” but would comply, while continuing to focus on its own strength in the region.
JetBlue, for its part, has largely moved on. After exiting the NEA, it pivoted to focus on its proposed merger with Spirit Airlines, another legal battle that ended in defeat. JetBlue ultimately abandoned the merger earlier this year after a judge blocked it on antitrust grounds as well and has recently announced a partnership with United Airlines.
The case was American Airlines Group v. United States, 24-938.
CONCLUSION
The Supreme Court’s decision not to take up the case ends the matter decisively: the Northeast Alliance is dead. For American Airlines, this is a strategic setback. The NEA was its workaround to a shrinking New York footprint and an increasingly competitive landscape. Without it, American must now rely on its own underwhelming domestic strength in the Northeast, while JetBlue regroups after failed partnerships on two fronts.
Should the SCOTUS have taken up this case and reinstated the Northeast Alliance? Does the fact that the Trump Justice Department continued to defend the government’s victory in defeating the Northeast Alliance suggest it may not be as merger-friendly as some may think?
An anti-business ruling from this SC? Now that is news.
A significant blow to AA.
Let’s stop with the fixation on Aaron, please…
But that post was about Scott. A terrible FA that all of us, except one person here agree on.
I do seem to keep his right hand busy, that’s for sure.
The Supreme Court is a bunch of lazy people. They hear very few cases.
The NEA was anti-competitive and the real impact is that it prevents not just AA but other airlines from trying to create a similar structure in the future.
One thing for sure: Some lawyers made a lot of money in billable hours and copying fees for all this…
Kinda disappointing. Of course JV’s could be uncompetitive if say B6 and DL teamed up in jfk/bos. But AA and b6 would of helped each other compete with the stronger DL and UA airlines in the NYC market.
Disappointing to see the courts unwilling to take a more nuanced approach.
AA didn’t give Justice Thomas enough money and gifts. Why on Earth should the supreme Court do AA any favors if they’re not getting in return for it? Rookie mistake. Maybe AA should hire Jeff Smisek to come run the airline. He definitely knows how to take care of people in situations like this.
He already has a luxury bus, maybe they should gift him his very own 777. That might tilt the scales
Clarence Thomas is the best supreme court justice we’ve ever had. Much smarter Jumanji Jackson.
Good. I don’t want the airline I fly to be associated with the scum-sucking “hometown airline” of the repulsive cities known as Noo Yawk and Masshole Central.
Odd… the Federal Courts approved the AS/HA merger, but objected to the NEA.
Maybe the courts are not as objective as I was led to believe.
The funniest thing to me about this was that basically all of the travel bloggers insisted that the court was wrong on the law. However, while I’m not a lawyer, the Boston federal court ruling seemed well reasoned to me. JetBlue moved on immediately, and the Supremes saw no reason to jump in. Maybe this thing never had a chance to begin with.
The NEA, while it lasted, led to lower fares and more choice for consumers…and I stand by that. The size and scope of DL at JFK and UA at EWR made it necessary for B6 and AA to work together to meaningfully compete, and that helped consumers.
Did you read Leo Sorokin’s opinion or listen to his asinine comments? The rube had no clue what he was talking about.
I wonder why Matthew that you can see this clearly but Tim Dunn sees it differently? Maybe it is because he is biased in favor of Delta. But what else is new with him?
By the way – Matt, your concluding paragraph ultimately explained why this thing didn’t last.
“ The NEA was its workaround to a shrinking New York footprint and an increasingly competitive landscape.”
The law is going to look very hard at “workarounds” to “competing.” If American wants to compete in NYC, it simply has to actually compete! Improve lounges, service, whatever within the context of the slots you have.