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Post date: July 27 2001

New York Joins Suit To Stop United/us Air Merger

Attorney General Spitzer said today that New York will join the U.S. Justice Department and a number of other states in a lawsuit to stop the proposed merger of United Airlines and US Airways.

Earlier this month, it appeared that the merger had been called off, but on July 12, the airlines told state and federal regulators of their intent to close the deal by as early as August 1.

Spitzer has long opposed the merger, saying that as proposed, it would result in less competition and higher airfares for upstate businesses and consumers. Spitzer's Antitrust Bureau has led a year-long multi-state investigation into the matter.

"Hopefully, this action by the Justice Department and the states will be the final nail in the coffin to a proposal that I believe would have been very harmful to the fragile upstate economy," said Spitzer.

"We need more competition, not less in the airline industry. We've seen the significant impact that airlines like JetBlue and Southwest have had on upstate airline prices, and we can't afford to take a step back now."

According to a study by Spitzer's office, the proposed merger would have a significant anti-competitive impact on air service from Buffalo, Rochester, Syracuse and Albany to a number of key destinations, including the New York City area and Washington, D.C.

The lawsuit will be filed early next week. The case is being handled by Assistant Attorneys General Richard Grimm and John Ioannou, and Director of Economics Hampton Finer, under the direction of Bureau Chief Jay Himes.