JetBlue Airways (B6, New York JFK) and American Airlines (AA, Dallas/Fort Worth) are trying to salvage codesharing, reciprocal frequent flyer, and bilateral prorate agreements that form part of their Northeast Alliance (NEA) at airports in New York City and Boston, outlawed on antitrust grounds by a federal court last month.
The airlines have filed a request with the US District Court of Massachusetts in Boston to present oral arguments for a "straightforward injunction allowing the orderly winding down of the aspects of the NEA this Court deemed unlawful while minimising consumer disruption".
In particular, they want to continue codesharing, reciprocal frequent flyer recognition, and bilateral prorate agreements that are common in the industry. They are also objecting to being subjected to five years of "invasive monitoring" at their own expense; and to being barred from entering into commercial agreements with other domestic carriers that provide for revenue sharing or coordination of routes or capacity.
On May 19, the Boston court ruled in favour of the United States Department of Justice (DOJ) and Attorneys-General of six states and the District of Columbia in their civil antitrust lawsuit to stop the NEA. The court ordered that the alliance be permanently disbanded within 30 days (by June 19).
In their latest court application, the airlines argue the requirement to cease all activities governed by the NEA is worded so broadly that it could result in the prohibition of reconciliation and payment processes. The carriers argue they should not be barred from remunerating each other for operating codeshares and providing frequent flyer accrual and redemptions. "Codeshare commissions and frequent flyer remuneration are standard in the industry precisely to ensure that the right airline is paid for the service provided to the consumer."
JetBlue and American may still decide to appeal the court's ruling entirely. JetBlue is still considering appealing the ruling, the airline told Bloomberg. "We've got a legal system that will ask for an appeal, and we're going to do that," American Chief Executive Officer Robert Isom said at the webcast 39th Bernstein's Strategic Decisions Conference on May 31.
