USAir goes to court to break up BA plans
Ramon Lopez/WASHINGTON DC
USAIR HAS finally declared its position on the pending alliance between British Airways and American Airlines in dramatic fashion, by filing a lawsuit against its UK partner for breach of contract.
The legal challenge, which is filed in a federal district court in New York, alleges that BA's new alliance breaches its commitments to USAir under their three-year-old marketing pact. American is accused of conspiring to aid the violation. The filing also complains that the alliance would violate US anti-trust laws.
A central complaint appears to be that USAir gave up its own transatlantic ambitions as a condition for approval of its link with BA in 1993. The airline is seeking to reclaim routes to London from Charlotte, Pittsburgh and Baltimore. "Our action advances and underscores the absolute determination of USAir to become a viable competitor in key US-UK markets," says USAir chairman Stephen Wolf.
BA and American have given public reassurances that USAir will be included in their alliance, and although signs of a rift have been growing, the lawsuit appears to have come as a surprise.
American says that it is "-astonished and mystified", while BA says that it will continue to codeshare with USAir, adding that it is confident of winning any legal challenge.
BA confirms that it has been holding talks on expanding the USAir co-operation, but USAir describes the move as a "-a charade designed to freeze USAir by holding out the false promise that the USAir/BA relationship would improve". BA has invested $400 million in USAir for a 26% stake, but let the option for further investment lapse.
Meanwhile, a report from the UK cross-party parliamentary committee which has held hearings into the alliance has given its broad blessing to the tie-up. A decision over whether the alliance will be referred to the UK's competition watchdog, the Mergers and Monopolies Commission, is still pending, however.
Source: Flight International
