April 29 (UPI) — American Airlines on Monday sued JetBlue Airways in the Business Court of Texas to recover funds that JetBlue allegedly owes from the failed Northeast Alliance partnership effort.
American Airlines and JetBlue initially announced the proposed partnership in July 2020, which the Department of Transportation approved shortly before President Donald Trump ended his first term in the White House.
The Biden administration blocked the proposed Northeast Alliance between the two airlines when a federal court in 2023 ruled the partnership would create a monopoly and cause air fares to rise while reducing travelers’ choices for airlines.
American Airlines sought to offer its travel benefits to JetBlue customers while expanding its potential customer base by partnering with the low-cost airline.
“The objective was to advance our business strategy and enhance our customer proposition by building on American’s network position and giving a partner’s customers access to our global network and the world’s best loyalty program in AAdvantage,” said Steve Johnson, American Airlines vice chair and chief strategy officer, in a prepared statement on Monday.
“Although we proposed a very attractive proposition to JetBlue and its customers and team, it became clear over time that JetBlue was focused on different business priorities,” Johnson said of the failed partnership negotiations.
“Ultimately, we were unable to agree on a construct that preserved the benefits of the partnership we envisioned, made sense operationally or financially, or was consistent with the travel rewards and co-branded card business objectives.”
JetBlue has announced it is seeking a partnership with another airline, and American Airlines officials want the budget air carrier to pay money they say is owed.
JetBlue officials did not respond to a UPI request for comment but earlier told Axios the airline’s legal team would review American Airlines’ lawsuit against the low-cost airline.
A JetBlue spokesperson also confirmed the airline continues to seek a partnership with another airline.
“We are talking to multiple airlines about a new partnership,” the spokesperson told Axios. “We have been making good progress and expect to announce a partnership agreement in the second quarter.”
Spirit Airlines was among the airlines with whom JetBlue sought a potential partnership, but that effort failed and led to JetBlue reducing its routes in the United States, Mexico and South America.
The Transportation Department also recently levied a $2 million fine on JetBlue due to “chronic flight delays.”
The DOT accused JetBlue of using a “prohibited unrealistic flight scheduling practice which can harm both passengers and fair competition across the airline industry.”
Half of the $2 million fine is to be paid to affected JetBlue customers.
