UAL Corp.’s merger with Continental Airlines Inc. won’t create a monopoly and shouldn’t be blocked on antitrust grounds, a federal judge ruled.
U.S. District Judge Richard Seeborg in San Francisco yesterday said the plaintiffs failed to argue adequately the acquisition will substantially reduce competition in the airline industry, and declined to enjoin the pact.
The plaintiffs’ “failure to establish a viable relevant market dooms any effort to show this merger will substantially lessen competition, thereby negating their ability to raise even serious questions, let alone a likelihood of success on the merits,” which is required for granting a preliminary injunction, Seeborg wrote.
Joseph Alioto, an attorney representing consumers, filed the antitrust suit in June, claiming the merger would increase fares, reduce flights and eliminate jobs.
Alioto didn’t immediately return a call seeking comment today before San Francisco business hours.
Shareholders of Houston-based Continental and Chicago-based UAL on Sept. 17 approved the $3.22 billion all-stock merger that was announced in May.
The airlines received regulatory approval from the Justice Department in July to merge, creating an airline company surpassing Delta Air Lines Inc. as the world’s biggest.
“We are gratified by the court’s decision to deny the plaintiff’s motion,” Julie King, a Continental spokeswoman, said today in an e-mail. “We expect to close the merger on Oct. 1.”
© Copyright 2021 Bloomberg News. All rights reserved.