JetBlue Airways (B6, New York JFK) and Spirit Airlines (NK, Fort Lauderdale International) are challenging a request by law firms for up to USD34 million in fees for having sued to block the airlines' USD3.8 billion merger, which was ultimately abandoned in March, according to documents in the case filed with the US District Court of Massachusetts.
The eight law firms had represented a group of 25 passengers and travel agents in an antitrust lawsuit, initially filed in November 2022 in the Northern District of California and later transferred to Massachusetts, against the now-failed merger between JetBlue Airways and Spirit Airlines. The lawsuit was filed when the Department of Justice (DOJ) was still reviewing the transaction. The Massachusetts court dismissed all complaints except two for lack of legal standing. The dismissed plaintiffs appealed. However, in the meantime, the court stopped the proposed merger in January 2024 when it agreed with the DOJ that the merger would reduce competition and increase fares. The airlines initially appealed but voluntarily abandoned the merger in March after concluding they would not receive the required legal and regulatory approvals. The US First Circuit court subsequently dismissed the 22 plaintiffs' appeal as moot.
In their motion for fees, costs and expenses based on more than 6,700 hours of legal work, the attorneys contend the lawsuit was crucial in prompting the airlines to drop their appeal, thus contributing to the merger's collapse.
However, the airlines argue their case (1:23-cv-10678-WGY) was ineffective and essentially duplicated the DOJ's lawsuit. "They did not try this case. They did not win at summary judgment; indeed, 22 of the original 25 plaintiffs were dismissed at summary judgment for lack of standing. One plaintiff was voluntarily dismissed as a result of her death," the airlines said. The pendency of the DOJ injunction drove their decision to terminate the merger, it said.
They also argue that the fees claimed are "excessive and insufficiently supported", alleging they include claims for plaintiffs whom the court had dismissed for lack of standing and for work done after the DOJ had already sued the airlines.