Jessica M. Karmasek Nov. 7, 2013, 3:30pm

WASHINGTON (Legal Newsline) -- U.S. Attorney General Eric Holder said this week American Airlines and US Airways must make some significant concessions if they want to settle the government's lawsuit over the proposed airline merger.

Holder made the comments during a press conference Monday.

"We will not agree to something that does not fundamentally resolve the concerns that were expressed in the (lawsuit) and do not substantially bring relief to consumers," he said, according to The Associated Press.

Holder said if the airlines and the government can't reach a deal, his office is prepared to take the case to trial Nov. 25.

The attorney general's comments come after reports that the airlines are in "exploratory talks" with the Justice Department about setting the lawsuit.

In February, the boards of directors of both AMR Corporation, the parent company of American Airlines Inc., and US Airways Group Inc. unanimously approved a definitive merger agreement under which the companies will combine to a create a "premier global carrier" that will have an implied combined equity value of about $11 billion -- based on the price of US Airways' stock as of Feb. 13.

In August, a coalition of six states, the U.S. Department of Justice Antitrust Division and the District of Columbia filed a federal court complaint challenging the merger, which would make the combined airline the largest worldwide carrier.

The complaint alleges reducing the number of major airlines from five to four would make fare and fee increases easier, and would make airlines even more profitable than they already are.

The six states are: Arizona, Florida, Pennsylvania, Tennessee, Texas and Virginia.

Texas has since settled with the airlines. In recent months, Florida Attorney General Pam Bondi has been pressured by the state's federal lawmakers to back the merger.

American Airlines has said the combined airline -- which will be called American Airlines -- will offer more than 6,700 daily flights to 336 destinations in 56 countries and is expected to maintain all hubs currently served by both airlines, resulting in more travel options for customers.

The company will be headquartered in Dallas-Fort Worth, but will maintain a "significant corporate and operational presence" in Phoenix.

"The combined airline will have the scale, breadth and capabilities to compete more effectively and profitably in the global marketplace," Doug Parker, chairman and chief executive officer of US Airways, said in February.

"Our combined network will provide a significantly more attractive offering to customers, ensuring that we are always able to take them where they want to travel, when they want to go."

The merger was set to close in September, but still needs government regulatory approval.

Both companies have since agreed to extend the deadline for completing the $14 billion merger to at least Jan. 18.

From Legal Newsline: Reach Jessica Karmasek by email at

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