Alaska Airlines Faces Consumer Lawsuit Over Hawaiian Airlines Merger
Eight airline passengers claim the $1.9 billion deal would lead to higher ticket prices and fewer flights
Photo: Alaska Airlines, Boeing 737-800. Courtesy of Cody Fitzgerald / Unsplash
Airline passengers have filed a consumer lawsuit against Alaska Airlines, claiming that its proposed $1.9 billion acquisition of Hawaiian Airlines will decrease competition in the sector at the expense of travelers.
Eight plaintiffs, described as airline passengers from Hawaii, California, and other states, filed the lawsuit in federal court in Hawaii on Monday. The plaintiffs, some of whom are former travel agents, say that the merger would violate U.S. anti-trust law and lead to higher ticket prices, fewer flights, and job scratches.
Photo: Alaska Airlines, Boeing 737 MAX 9. Courtesy of Boeing
“The current trend toward concentration, the lessening of competition, and the tendency to create a monopoly in the airline industry is unmatched, unparalleled, and dangerous,” the lawsuit states.
Attorney Joseph Alioto, representing the plaintiffs, warned that the deal would lead to a “shutdown of competition.”
“Every one of these mega-mergers is a blow to the free enterprise system,” he said.
Alaska Airlines, the only defendant, dismissed the lawsuit as “a normal occurrence in public company mergers” and didn’t comment further.
The Seattle-based carrier had previously said that the merger “will unlock more destinations for consumers and expand choice of critical air service options and access throughout the Pacific region.”
Hawaiian Airlines, which wasn’t named in the lawsuit, didn’t comment.
Photo: Courtesy of Christian Brinkmann / Airbus
The merger has already gained the approval of shareholders of both airlines. However, it’s subject to review by the Department of Justice, which has been an aggressive enforcer of anti-trust laws under President Biden, especially in the aviation sector.
In January, the DOJ successfully sued to block JetBlue’s planned merger with Spirit Airlines, which would have created the fifth largest carrier in the country, on competition grounds. The airlines later walked away from the deal.
The DOJ also sued to disband the Northeast Alliance between American Airlines and JetBlue, which saw the carriers coordinating schedules and trading landing slots in the busy northeast corridor.
Photo: Alaska Airlines Boeing 737 MAX 9. Courtesy of Alaska Airlines
While American Airlines and JetBlue said the deal allowed them to compete against entrenched rivals United and Delta in the region and offer more flights and seats, the DOJ said the alliance cost passengers hundreds of millions of dollars each year in higher ticket prices. American Airlines has since appealed against the decision, threatening other joint ventures.
Last month, Alaska and Hawaiian reported that they “have been working cooperatively with the DOJ and expect to continue to do so.” The Department of Justice didn’t comment.
