Alaska Airlines bought Hawaiian Airlines in 2024, which a group of customers alleged had raised flight costs and cut service in violation of antitrust laws.
(CN) – A federal judge on Friday dismissed an antitrust lawsuit by six people who want to undo the carriers’ 2024 merger because, they say, it has resulted in fewer flight choices, higher costs and reduced service.
U.S. District Judge Micah Smith agreed with Alaska Airlines, which paid $1.9 billion to Hawaiian Airlines, that the plaintiffs — who say they fly the airlines regularly — had not made a legally sufficient case why the extreme sales vehicle would be adequate compensation for their alleged harm.
Nominee Joe Biden also concluded that the plaintiffs had not met their burden, as required by US antitrust law, to establish a relevant geographic market that has been affected by the combination of the two airlines and how the merger has resulted in fewer flight choices, higher costs and reduced service.
“For example, plaintiffs’ anecdotal suggestion that they experienced price increases on a small portion of routes, or less favorable route options, does not conclusively support a conclusion that Alaska has increased prices or decreased routes because of the merger,” Smith wrote.
Also, the judge was not convinced that the lawsuit could proceed based on the claim that the merger has harmed Hawaii’s economy and the well-being of local residents. Citing the U.S. Supreme Court’s observation that any merger can create economic adjustments that adversely affect some people, Smith said such adjustments do not necessarily give rise to an antitrust claim.
The complaint “has not provided factual allegations that, admitted as true, plausibly show that the economic adjustments have anticompetitive effects — that is, that the effects are the result of greater Alaska market power or the elimination of a competitor,” he said.
In 2024, the judge previously presiding over the case dismissed the complaint because the plaintiffs had failed to argue that they had standing to file the case since none of them had alleged that they had ever flown to Hawaii or Alaska, or planned to do so in the future.
While that dismissal was without leave to amend the complaint, the Ninth Circuit sent the case back to federal court in Honolulu to give the plaintiffs an opportunity to correct deficiencies in their original filing.
Smith dismissed the prejudicial sale claim, meaning the plaintiffs cannot try to salvage that claim because, he said, they had abandoned it by not responding in their briefs to Alaska’s arguments that their complaint did not provide a basis for obtaining the sale.
As for their antitrust claims, the judge invited the plaintiffs to submit a letter explaining how they can remedy them before he decides whether they can file a second amended complaint.
He noted that the plaintiffs had already indicated in a separate proceeding before a magistrate judge that they might not be able to better articulate their claims without first receiving discovery from Alaska. The magistrate judge, however, denied their bid to require documentation from the airline before they survived Alaska’s motion to dismiss.
“Thus, the fact that plaintiffs appear not to believe they can adequately address the deficiencies in their complaint without discovery weighs against, not in favor of, granting leave to amend,” Smith said.
Attorneys for the plaintiffs did not respond to a request for comment on the ruling.
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