UPDATE 1-U.S. asks for March trial in airline merger challenge
WASHINGTON, Aug 27 (Reuters) - The U.S. Justice Department asked a federal court on Tuesday to set a March 3 trial date to hear arguments over whether it should stop a planned merger between US Airways and American Airlines.
The companies had requested a 10-day trial that would begin on Nov. 12.
The Justice Department filed a lawsuit on Aug. 13, asking a federal court to order the companies to abandon plans for a deal to create the world's largest carrier.
The department has argued that the deal would reduce competition and lead to higher air fares.
The companies have said that the deal was critical for American Airlines, which has been operating under Chapter 11 protection since late 2011. They also argue that consumers would benefit because the new airline would give Delta Air Lines Inc and United Continental stiffer competition.
Companies generally push for an expedited trials in merger challenges. Holding a deal together for months puts a strain on the parties because they are essentially in limbo, unable to merge and hampered in making independent long-range plans.
US Airways, based in Tempe, Arizona, and American, based in Fort Worth, Texas, have vowed a vigorous defense of the merger, which would cap recent industry consolidation that has help put U.S. airlines on a more solid financial footing.
The companies had argued in their filing that they faced "unusual and pronounced burdens while they await their day in court," with American particularly vulnerable since it is in the process of emerging from bankruptcy.
They also noted that the merger agreement included a termination clause that would allow either carrier to scrap the deal as of Dec. 13.
The Justice Department, for its part, argued that American Airlines' restructuring effort had been "extraordinarily successful and had positioned the company to compete as a strong and vibrant standalone firm."
And it dismissed the importance of the Dec. 13 date. "They (the companies) can change this self-imposed deadline with the stroke of a pen," the Justice Department said in its filing.
Spokespeople from American Airlines and US Airways were not immediately available for comment.
The case at the U.S. District Court for the District of Columbia is No. 1:13-cv-012346-CKK.