A US judge has dismissed a lawsuit against Alaska Airlines’ planned acquisition of Hawaiian Airlines due to the plaintiffs’ lack of standing.
A group of consumers had filed the lawsuit in the US District Court for the District of Hawaii in April. The goal was to block on anticompetitive grounds Alaska’s proposed $1.9 billion acquisition of rival West Coast carrier Hawaiian.
Plaintiffs represented by San Francisco-based Alioto Law Firm argued that Alaska’s deal to acquire Hawaiian violates US antitrust law by lessening competition in certain US airline markets – and potentially harming the island state’s $20 billion tourism economy.
“Having reviewed the complaint, the briefing on the motion to dismiss, and the record generally, the court agrees that plaintiffs lack Article III standing,” judge Derrick K Watson writes in his 12 August decision.
“In particular, although plaintiffs seek to enjoin the Alaska-Hawaiian merger, they… allege no personal connection to either airline that would plausibly establish a concrete or particularised harm. Rather, they assert only the type of generalised injury that is common to ‘the public at large.’”
Following a months-long courting process, Alaska signalled in December that it planned to acquire Hawaiian within 12-18 months, combining two “highly complementary networks” and assembling a combined fleet of an estimated 365 aircraft. Alaska chief executive Ben Minicucci was tapped to take the top role at the combined company, which would be headquartered in Seattle.
Hawaiian’s shareholders voted in February to approve the deal, which is currently under review by the US Department of Justice (DOJ). The federal government has yet to take any action against the tie-up, and the companies said last month they ”continue to work co-operatively with the DOJ”.
The plaintiffs had said in their suit that the deal would reduce competition when the two airlines’ networks are combined. A post-acquisition Alaska would control more than two-fifths of the share of capacity on routes between Hawaii and the mainland USA, allowing it to ”limit or eliminate flights, raise fares, add ancillary fees, lessen services and effectively control 40% of the seat capacity traffic between Hawaii and the US mainland”, they said.
A loss of airline capacity between Hawaii and the contiguous USA would be “disabling” for Hawaii, which heavily depends on air travel and tourism to sustain its economy, they add.
The lawsuit stated that 9.2 million air travellers visited Hawaii in 2022, of which 85% came from the US mainland.
On 14 August, the companies said they had extened the DOJ’s review period of the merger until 16 August 2024. Initially it had been set to expire on 5 August, and was then extended to 15 August.
However, that date has now been extended by another five days until 20 August.
This story was updated on 16 August to reflect the latest DOJ review deadline.
