JetBlue-American Airlines ‘Alliance’ Has Caused Consumers to Pay Millions More for Plane Tickets, Class Action Claims

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JetBlue and American Airlines face a proposed class action that alleges the companies’ so-called “Northeastern Alliance” has eliminated head-to-head competition between the two at the four largest airports nationwide and caused prices to increase significantly for consumers. 

The 29-page complaint was filed nearly a month after Justice Department (DOJ) lawyers issued closing arguments in litigation challenging JetBlue and American Airlines’ July 2020 agreement to coordinate schedules and share revenue on a number of routes to and from New York and Boston. The proposed class action alleges the airlines have run afoul of the federal Sherman Antitrust Act by unlawfully manipulating the Northeastern air travel market, harming consumers to the tune of roughly $700 million annually. 

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“Combined, the two entities now represent and/or represented at least a 37% market share for flights to and from the northeastern United States,” the lawsuit says, alleging that materials shared publicly by the airlines about the partnership failed to divulge how the reduction in competition would harm consumers. 

According to the case, the agreement between JetBlue and American has eliminated head-to-head competition between the airlines at Boston Logan, LaGuardia, John F. Kennedy and Newark Liberty airports, the four largest in the United States. In September 2021, the suit relays, the Department of Justice, six states and the District of Columbia sued JetBlue and American under the Sherman Act, aiming to “prevent harm to consumers that will occur once the [alliance] is fully implemented[.]” 

A trial over the JetBlue-American Airlines alliance commenced in September and concluded on November 18 after an 18-day bench trial, the lawsuit states. According to Forbes, the result of the case will stem from the judge’s reading of antitrust law and decision as to whether the government showed enough evidence to squash the airlines’ partnership. 

According to the proposed class action, the DOJ testified at trial that for routes between Boston and 12 major airports, JetBlue and American have a combined revenue share of more than 49.8 percent for each route. Moreover, the DOJ added that for routes between JFK/LaGuardia or Newark Liberty and 18 major airports, the defendants have a combined revenue share of 31 percent for each route, the case says. 

These particular market shares allow JetBlue and American Airlines to dictate flight availability, fare pricing, and other variables, the suit stresses. The alliance between the companies harms not only consumer choice but increases the “likelihood” of anticompetitive coordination, the lawsuit contends. 

The case looks to represent all direct buyers of airline tickets going to or from Boston’s Logan Airport, New York’s LaGuardia or John F. Kennedy airports, and New Jersey’s Newark Liberty Airport from JetBlue and American Airlines at any time from July 16, 2020 through the present. 

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