American Airlines Appeals Court Ruling That Stopped Northeast Alliance with JetBlue

On Monday, American Airlines appealed the US ruling that ordered the end of its Northeast Alliance with JetBlue.

In May, US District Judge Leo Sorokin ordered the two airlines to wind down their partnership. According to the ruling, the Northeast Alliance violated antitrust laws.

Judge Sorokin stated “Until 2020, American and JetBlue were fierce and frequent head-to-head competitors. The NEA changes all of that.”

Northeast Alliance

The four-year collaboration between American and JetBlue allowed the two airlines to intertwine their operations. This partnership came with two main elements. First, there are the codeshared flights in four airports in New York and Boston. Also, loyalty members of the two airlines could get reciprocal loyalty benefits. This means TrueBlue members earn points flying on American Airlines while AAdvantage members earn miles flying JetBlue.

Booking codeshare flights stopped beginning July 21. In addition to this, customers were given an ultimatum until July 20 to book award tickets on the other airline.

As for existing reservations via Northeast Alliance, American Airlines assured that customers shouldn’t worry. It announced, “We will continue to work with the JetBlue team to ensure customers who have existing codeshare bookings can travel seamlessly without disruption to their travel plans.”

In a statement, JetBlue Vice President Dave Fintzen said “We are disappointed to be ending popular benefits like codesharing and reciprocal loyalty benefits.” On the other hand, American Airlines insisted that the Northeast Alliance was “pro-competitive, pro-consumer.”

JetBlue Won’t Appeal the Decision

Unlike American Airlines which appealed the ruling, JetBlue chose to accept the end of their alliance. JetBlue has announced that it wouldn’t appeal the ruling to protect its planned $3.8 billion acquisition of Spirit Airlines. However, JetBlue’s move to buy Spirit Airlines faces a separate legal challenge.

Is the Northeast Alliance good for consumers? Florian Ederer, an associate professor at Yale University who specializes in antitrust cases thinks that the end of the Northeast Alliance is good for consumers. He said, “I do think that disbanding this agreement will actually reinject a healthy dose of competition, lower prices and higher quality for consumers in the Northeast.” He also believes that the alliance was “a merger in everything but name.”