American, JetBlue to pay states' legal fees in antitrust lawsuit

By Mike Scarcella

Jan 22 (Reuters) - American Airlines and JetBlue have agreed to pay a group of U.S. states nearly $2 million in legal fees after the states won a trial challenging the airlines' now-blocked U.S. Northeast partnership.

American and JetBlue will split the tab evenly in payments to the District of Columbia and six states, including Massachusetts, California and Pennsylvania, according to a settlement agreement obtained by Reuters.

U.S. District Judge Leo Sorokin in Boston in an order on Tuesday approved the parties’ fee settlement.

American, JetBlue and the state officials that signed the fee deal either declined to comment or did not immediately respond to requests for one.

The states, which also included Florida, Virginia and Arizona, sued along with the U.S. Justice Department in 2021 to stop the Northeast partnership on antitrust grounds.

The airlines had agreed in 2020 to operate together for most flights in and out of the Boston and New York areas.

American is the largest U.S. airline by fleet size while low-cost carrier JetBlue is the sixth largest. The states said the alliance would cost consumers hundreds of millions of dollars through higher fares and reduced routes.

Sorokin presided over a trial and in 2023 blocked the alliance. An appeals court upheld the decision last year, and the airlines have since taken steps to unwind their alliance.

The airlines denied the states' antitrust claims, and they said in Tuesday's fee settlement that agreeing to pay the fees was not an admission of wrongdoing.

A provision of U.S. antitrust law allows the prevailing party to recover legal fees.

American and JetBlue are still fighting a related consumer lawsuit in federal court in Brooklyn.

The case is United States of America et al v. American Airlines Group and JetBlue Airways Corp, U.S. District Court for the District of Massachusetts, No. 1:21-cv-11558-LTS.

For Massachusetts: William Matlack of the attorney general’s office

For American: Alfred Pfeiffer and Christopher Yates of Latham & Watkins

For JetBlue: Matthew Craner and Richard Schwed of A&O Shearman

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(Reporting by Mike Scarcella)