Update on DOJ case, they are being very vocal
 

as pessimistic I am about this, I can't but feel like maybe this is gonna happen after all. I just have this bad feeling in 2 weeks we get the article "talks between aa/us and doj break down"

But this seems like a pretty significant about face for the doj.

I think the DOJ realized they're in over their heads on this one, with nothing to back up their big talking earlier.

They screwed up bad and know they're going to get taken to the cleaners in the court room. They wish this whole thing would've never happened and are trying to figure out how to get out of it without looking like idiots.

They will. The merger will go through. The only thing that will have been accomplished is that they cost the companies and employees millions and millions in the process. But who cares, right?

I think the initial hopes of the DOJ were that one or both airlines would say screw it and not fight it, hence the attempts at a delayed trial date, attempts to delay things during the shutdown, statements by Baer that there was it was nearly impossible to settle, etc. The government was hoping that it would drive both airlines away. They failed to realize that we were coming at this thing with both barrels and that the outside support was overwhelming. At this point, I think they're just trying to get out of this thing with a slight bit of dignity still intact (is there such a thing in government?).

This is just Chicago politics on a national scale, but with one problem. Light. Cockroaches have learned how to avoid it in Chicago. They are use to getting their way. They have not perfected it nationally. Look at the players. A message was sent. Who knows the reasons behind it. But it is for a political reason. A larger judicial branch cannot all be corrupted like in Chicago. Light. So they try to achieve a political goal and back away in the light of independence judicial review. Anyone who thinks otherwise does not know what is going on in the US.

This is exactly what the DOJ had hoped for, delay delay delay until the expiration of the merger completion clock. Now with all the political pressure and the expedited trial date the government has to go to court with "ticket prices" as the basis of their case. That would be a loser and a waste of the tax payers money.

WD at AWA

Which I don't think would be a negative turn of events big picture. A big IF the talks break down (I don't see happening), that probably means the airlines won't give in to the DOJ's unrealistic concessions and are VERY confident they will win in court. The airlines won't be giving up so much that they lose their competitive advantage and synergies of the merger.

Or if they do break down they might think it's better to lose the court case and scuttle the merger than give in too many concessions and make it not worth it. DP isn't the final authority on all this, the ucc will decided how much is too much even if DP begs them to reconsider.

Actually their case is based on section 7 of the clayton act. All they need to prove is that this merger is anti-competitive. They have the 1000 1 stop connects via the hhi and dougs e-mails. I think if it goes to trial it's a 50/50 shot at best. Its not a slam dunk case for the doj but it's not pathetic and weak like everyone makes it out to be either.

You're pessimistic about everything. I just hope i never have to meet or work with you in real life. It seems it's always raining and cloudy where you are. It would really suck to get rained on indoors! Suns shining where I am and merger or no merger, I'll survive...

I take a realist approach to this and don't subscribe to the echo chamber here..

"All they need to prove is that this merger is anti-competitive. They have the 1000 1 stop connects via the hhi and dougs e-mails."
The government numbers are skewed and smells of funny math.
Independent research has found these numbers to be much lower and government took advantage of a lot of gray area to get where they did.
Your wanting of this merger to die is oozing everywhere.

Everyone keeps saying the math is fuzzy but they never say how.

And I don't want it to die, I just dont feel like lying to myself to make me feel better.

I understand the "expect the worst" - Usairways is the only company that could manage to get rained on inside a building. That said, you do still have to,"Hope for the best." As bad as things are, we have seen worse days and lived through them. I hope that you never experience another 9/11 or even one bankruptcy, let alone two. I mean this in all sincerity, your health will suffer if you don't let just a little ray of sunshine in. So very sorry for the lecture- just wishing you the best, most successful, healthy career as a pilot. (also as far as the math you don't need to see numbers to know that the DOJ is off when they leave out Southwest and JetBlue.)

The math is fuzzy in several ways. First, the government chose to use one-stop routes. Never been done that way before. Past consistency would have to been to compare non-stop routes only. "Okay" you say. "Times they are a changin'..." The government is changing how they look at these things. Well then, the DoJ failed to use all possible one-stop combinations when using our one-stops. They compared our one-stop monopolies against the rest of the industry's non-stops. Hardly seems fair to me...

The second way is their use of the term "markets." In previous mergers, the DoJ looked at nearby airports when comparing markets. For example, the New York market encompasses EWR, JFK, LGA, and even HPN. Or the MIA market includes FLL. Not this time. They are airport specific, for the first time. So, all of Spirit and JetBlue's FLL-Caribbean flying does not offset the HHI score for AA in MIA. That is idiotic, as they are direct, head-to-head competitors in those markets.

Finally, they are using the 1000 monopolistic markets (based on an HHI score) to demonstrate the need to block the merger. However, they excluded (by their own admission) certain competitors (Spirit, Allegient) from the analysis. Thus, their score is meaningless. They are basing decisions on a flawed score. I would say that is strike three...

Now, you keep saying that you're looking at this from a "realist"perspective. I question that. A realist would say that we have a rock-solid case, the government's actions are incompetent at best (criminal, at worst), and the math the DoJ used to justify their position is flawed. That is the reality of where we are. Does that mean we'll win? Who knows... It certainly appears that often the more convincing lawyer wins, not necessarily the party with the strongest case. Common sense says we will win. But, as we all know, common sense does not always prevail, particularly when dealing with the government. If I "knew" how it would go, I would either buy a ton of the stock, or short it -- and get rich. However, no one knows how it will go until the morning the verdict (decision) is read... I prefer to look at it as "not getting my hopes up again" until the cash is in the bank. But, the evidence certainly does seem to be pointin more towards the gov't bowing out...

Good post Andy.I don't know Canoe, but maybe he is a little like me. I straddle the fence between realist and pessimist, never accused of being an optimist.

Interesting that every person I have met that describes themself as a "realist" appear to be the most miserable people I have ever known.
I can't think of any situation where optimism hurts. What's the worst that can happen? You end up disappointed. So what.
The late John Wooden (Basketball Coach) said:
Things work out the best for those who make the best of the way things work out.
CG

I was pretty optimistic before August 13th.

Spend a few decades at US Air and get back to me! ;)

My post was meant to be slightly light hearted, maybe I should have added a smiley.

We are all geared a certain way, with some room for change. Is the person miserable and that makes then realistic, or are they realistic and that makes them miserable? I hope for the best, plan for something less than the worst. Don't have massive weapons and food stores in the basement.

I hope the merger works out, but if any big or long term plans are affected by it I have to assume it won't. I'm about 60-40 that it will, today.

I've seen a lot of mergers come and go so I didn't spend any money on it.

I just don't think the DOJ suit passes the stink test. Of course it's the government, so we know how that goes, but Holder seemed to be changing the tune a little.

Canoe, you nailed it. THEY (not AA), THEY, the DOJ, needs, as in have an obligation, to PROVE (not speculate, opine, but PROVE to the court) that this is ANTI-COMPETITIVE.

Yes, you nailed it. That is "all" they have to do.

Merger approval is very likely to occur.

In my 49 years, EVERY Debbie Downer I've encountered - every one - has used this EXACT type of comeback: "I'm not negative. I'm just a realist."

Right. Says every Debbie Downer, glass is half empty person.

Most optimists (including myself) will freely admit to being optimists. Most pessimists will not admit to being pessimists, and will claim to be "realists" ... thus proving the only thing they aren't pessimistic about is their pessimism!

Life is too short to go around expecting the worst all the time. I'm quite optimistic the merger will happen, but if it doesn't, I still have a job I enjoy at a profitable airline, and more importantly, my wife and kids are still waiting when I walk in the door after every trip. I'll drink to that ...

I don't think the DOJ has a rock solid case otherwise I would give this merge a 0% chance. The amended filing of the HHI does include SWA in their analysis but I still think it's 50/50 if it goes to trial.

We don't know what the DOJ found out in their discovery. Discovery generally doesn't help the defendant is these cases.

Having spoken to a few Anti-trust attorneys I tend to try and look at both sides of this case. Some on here choose to post every article that is sent out by any journalist as proof that the doj will lose this case. I think some people aren't clear about how anti-trust law works. There is no "reasonable doubt" or "past precedents" in mergers. They let ua/cal, dal/nw and airtran/swa merge. But that has no bearing what so ever on this case. Yet people still bring that up as their solid proof that the doj doesn't have a case.

You've made some good points but the amended suit did include SWA in the analysis.

Discovery is FOR the benefit of the DEFENDANT so they can learn what evidence the big bad prosecutor (DOJ) has against them, and formulate a defense strategy. DOJ does not "find out" about discovery. The prosecutor/DOJ has collected evidence against the defendant (AMR or John Wayne Gacy or whoever) and while technically "both sides participate in discovery", the primary bennifiter (spelling yes I know but I am tired) is the defendant.

No past precedents ? You might tell that to Apple's legal team and take a look at Shell Oil case, both involved antitrust issues. The entire theme of the DOJ case (take a look at the complaint) is MONOPOLY and ANTI-COMPETITIVENESS. The merger is just the event triggering the alleged monopoly and anti-competitive behavior. The merger is not the legal question here per-se, the legal question, the proof to the court, is if a monopoly will exist and/or anti-competitiveness. DOJ as to prove this to the court.

Put another way, the DOJ said Tom and Mary should not be married because DOJ thinks Tom is already married somewhere else. The perception is that DOJ is "against the marriage" which they are, BUT, the proof element, to the marriage court, the "because", needs to be proven by DOJ, to the court's satisfaction. DOJ needs to cough up a prior marriage certificate between Tom and another person, or bring some live bodies to the court who can say, gee, ole Tom is married to another woman. Absent DOJ proving this, Tom is getting married to Mary.

Apple Warns of 'Dangerous Precedent' If U.S. Wins Antitrust Case Over E-Books

Antitrust

Everyone has their own perspective on this but I feel the merger will be approved.

Next major event is Thursday Nov 21 which is "pre-trial conference". This is typically the last chance for all parties to hug and be friends and agree on whatever issues before trial. Friday Nov 22 is admin matters etc. After that, it is game day on Monday Nov 25.

Deleted.......

Again, they only included them on the direct head-to-head routes. Even the amended suit failed to consider outlying/alternative airports -- including SWA (for example MDW against ORD, FLL against MIA, BWI against DCA, OAK with SFO, etc...). Anyone with half a brain sees that these are competitive routes. Yet the DoJ denies that..... That was my point. And, they still only used the pre-merger SWA in their HHI calculations. How does that work?????

Anyways, I'm not saying that I think it's a done deal. Far from it. I have been sending out apps and resumes in the last month or so. I'm hopeful that it will happen (and am generally optimistic that it will), but that doesn't mean I'm not setting up a back-up plan in case it tanks... If the merger fails, my guess is that some people will stay and be quite happy at US and others will start to look elsewhere. One thing I do think is that if the merger fails, we will have trouble filling classes once Delta really picks up hiring, FedEx starts hiring again, and our contract stays so crappy with the internal squabbling going on... Maybe the company will have no choice but to intervene and settle this thing once and for all.

Or not. Let's just hope the merger happens soon.....

True it isn't all that attractive to be negative all the time, but let's be realistic. You are a new hire in 2013, I am a new hire of 1984. Generally we all start out fairly optimistic about our new employer, but much has happened in the last 30 years. I sincerely hope my next 10 will get me more positive about the airline, but until then,
Don't expect too many folks on the line with your attitude. I have been one of the lucky ones. Many have not faired as well. Just have a little bit of understanding for the less then enthusiastic. They deserve at least that much, IMO.

THANKS.

I understand what you are saying, but were you THAT negative in 1984? I can sympathize that things didn't turn out as expected for you guys. BUT, for someone brand new to be as negative as someone that's been put through the ringer for 30 years is what I don't understand. What is someone like that gonna be like in 2043? This job is not my entire life. I plan for the worst and try to enjoy going to work. If it gets that unbearably bad for me, I'll find something else to do. In the meantime I refuse to spend a large part of my existence miserable and refuse to spread misery on other people that would rather enjoy themselves. I knew what I was signing up for when I applied and accepted the position and it was as expected.

My post was directed at someone has was not here for any bankruptcy, is brand new, and is currently working under the exact contract he signed up for. I can completely understand that attitude among 88-89 hires an 99 hires, but to be brand new, never furloughed, not through any of the bankruptcies and that negative, I don't get.

I'm a realist too and the reality is that life is actually kind of fun. When it's no longer fun, it's time to change something.

If you can keep that attitude you will be just fine. It's worked for me since 1978.

You must have been an infant of 25 or 26 when you were hired.