Judge questions giving OK to AMR bankruptcy plan - 13 WTHR Indianapolis

Judge questions giving OK to AMR bankruptcy plan

Updated:
NEW YORK -

 

A judge has delayed a ruling on a plan by American Airlines to merge with US Airways and exit bankruptcy protection because of the federal government's lawsuit against the merger.

The hearing was supposed to be American's victory lap - the day that a judge would remove the last hurdle for a merger that would make American the world's biggest airline.

The U.S. Justice Department ruined American's plans - at least temporarily - on Tuesday by filing a lawsuit against the merger, which it said would hurt competition and increase prices for consumers by leaving four airlines controlling more than 80 percent of the U.S. air-travel market.

In court Thursday, lawyers for American parent AMR Corp. and its unsecured creditors said the Justice Department's case shouldn't stop the bankruptcy judge from approving AMR's reorganization plan.

But Judge Sean Lane wasn't so sure. He said he had "lingering doubts" about approving the turnaround plan and even considered postponing Thursday's hearing. Instead, he went ahead with the hearing but delayed a decision on AMR's plan until at least August 29.

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