Tuesday, January 12, 2010

oneworld Replies to the DOJ

Yesterday, the oneworld Alliance issued its reply to last month's filing by the Justice Department which opposed any broad grant of antitrust immunity for the joint venture.  See Joint Applicants' Answer to the Department of Justice's Motion for Leave and Comments, Dkt. No. DOT-OST-0252 (Jan. 11, 2010) (available here).  In brief, the alliance partners reiterated their position that antitrust immunity is necessary for them to compete effectively in the transatlantic aviation market.  From the filing:

The Joint Application will generate significant public benefits, and will not harm competition. On the benefits side, oneworld is currently the smallest branded alliance, and absent meaningful integration it will become increasingly marginalized as a competitive alternative to the larger and stronger Star and SkyTeam alliances. As for potential competitive harm, the overlap routes are some of the most competitive across the Atlantic, and the most likely to attract new entry. DOJ has failed to meet its burden of proof regarding harm, or to rebut the comprehensive evidence of public benefits satisfying the Department’s SkyTeam II and Star II precedents. The proposed alliance should be approved and immunized without further delay. 

See id. at 55.

This is not the first time oneworld has attacked the DOJ's steadfast opposition to antitrust immunity for alliances.  Last September, the alliance filed an advance rebuttal based on the criticisms the Department had levied against the Star Alliance application.  See Joint Applicants' Motion to Leave to File and Supplemental Comments, Dkt. No. OST-2008-0252 (Sept. 8, 2009) (available here).  Despite the Department of Transportation's October 31, 2009 deadline for an end to the oneworld proceedings, the DOJ delayed filing their comments in the case until just four days before Christmas.  See Joint Application of American Airlines, Inc. et al., Comments of the Department of Justice, Dkt. No. OST-2008-0252 (Dec. 21, 2009) (available here).  Though the DOT has officially closed further comments, it's unclear when they will render a final decision in the matter. 


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