A US federal judge said on Friday that the government’s lawsuit to block the proposed merger of American Airlines and US Airways will start on Nov. 25, a timetable favored by the airlines.
The US Department of Justice had wanted the trial to start in March next year, saying it needed more time to prepare for the complex case. The airlines said that such a long delay would threaten their merger.
US District Judge Colleen Kollar-Kotelly said in court on Friday that March was “too far off.”
The companies were close to completing a merger to create the world’s biggest airline, but the justice department and six states sued this month to block the deal. They said it would reduce competition and lead to higher prices for travelers. They said that the combined American-US Airways would be too dominant at Reagan National Airport outside Washington and on many routes around the country.
While the hearing before Kollar-Kotelly was mainly procedural, aimed at establishing timetables for reviewing documents and other preparations for trial, attorneys for the two sides did manage to preview their key arguments.
“This is a very dynamic industry,” said Richard Parker, an attorney representing US Airways.
The two airlines argue that their merger would increase competition by creating another big competitor to United Airlines and Delta Air Lines, which grew through recent mergers.
Parker also pointed to the presence of other competitors, including Southwest, which carries more passengers within the US than any airline.
“We will be talking to these airlines,” Parker said.
A review of other airlines’ documents and interviews of their executives will establish that competition in the industry is robust, he said.
However, the justice department’s lead attorney said that the proposed merger raised a number of competitive issues, including prices and the impact on some markets. The government will want to question airline executives about, for example, how fees are set for baggage and ticket changes, department attorney Mark Ryan said.
Ryan said it was impossible to accept the airlines’ assertion that a plan to cut costs would make the combined new carrier more efficient and save consumers money without the government being able to see details of the plan.
Parker cited the government’s previous approval of big-airline mergers, such as Northwest with Delta and United with Continental.
“By that standard, our merger passes muster by 10 miles,” he said.
Justice department lawyers have also pointed to recent record profits at both airlines — July’s profit was a one-month high at American parent AMR Corp, which has been cutting costs under bankruptcy protection — to argue that the companies do not need to merge to survive.
Both sides said in a court filing this week that they were open to a settlement that would avoid a trial, although each made comments suggesting that they were not close to agreement.
If the merger is blocked, AMR will have to rewrite its plan for emerging from bankruptcy protection. The merger is a key part of that plan.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to