American Airlines Group and JetBlue Airways (B6, New York JFK) have escaped five years of regulatory monitoring and a ban on future partnerships following the end of their Northeast Alliance (NEA), which formally ends on July 28, 2023.

According to the court order seen by ch-aviation, the Massachusetts District Court in Boston on July 26 rejected the United States Department of Justice's (DOJ) request for five years of monitoring and a ban on other commercial partnerships after they disband their alliance, outlawed on antitrust grounds.

US District Judge Leo Sorokin in Boston rejected the DOJ's request for an independent trustee to oversee the dismantling of the NEA for the next five years. The DOJ argued that "relief in an antitrust case must also serve the important functions of avoiding a recurrence of the violation and eliminating its consequences”. But Sorokin said the court was not licensed to implement "harsh measures when less severe ones will do". Neither could it implement "overly regulatory requirements which involve the judiciary in the intricacies of business management or vague prohibitions on all future violations of the antitrust laws".

In fact, Sorokin found the appointment of a monitor unnecessary. "The defendants entered the NEA openly, disclosed it to regulators at the outset, cooperated with the resulting investigations, and have now terminated the relationship without waiting for the court’s final judgment," he said.

Further, the judge denied the DOJ's request to ban the airlines from entering any new agreements that are substantially similar to the NEA. "The court finds such a prohibition is not necessary to achieve the appropriate aims of antitrust relief, which depend considerably on the particular circumstances of the case. Here, those circumstances include the nature of the defendants’ business models, the characteristics of the NEA agreements, and the specific geographic region and markets for air travel that were impacted by the defendants’ conduct."

For the same reasons, he denied a DOJ request that the airlines must notify the department and the Attorneys General of their respective states before entering any new agreements with other domestic carriers.

He asked the DOJ and the airlines to submit a revised version of the final judgment and permanent injunction on July 28. The injunction will formally end the NEA created by American Airlines and JetBlue Airways to compete more effectively in the New York City and Boston areas with Delta Air Lines (DL, Atlanta Hartsfield Jackson) and United Airlines (UA, Chicago O'Hare).

The new order follows requested changes to the final judgement, filed by American Airlines and JetBlue Airways earlier this week.

Asked for comment, an American Airlines spokesman said the airline would continue to fight the repeal of the NEA. "We are pleased the judge has rejected DOJ’s arguments for unwarranted and unnecessary relief in his final order. Once the final order is in place, we will proceed with appealing a decision that we continue to believe misapplied the law and led to the dissolution of an alliance that delivered significant, quantifiable and durable consumer benefits,” he said.

JetBlue Airways was not immediately available for comment.