Abbott drops Texas challenge to airline merger

AG drops Texas participation in federal-state challenge to American Airlines-US Airways merger

Associated Press

GRAPEVINE, Texas (AP) -- The Texas attorney general says the state has reached a settlement in its challenge to the proposed merger of American Airlines and US Airways.

Attorney General Greg Abbott had led Texas into the lawsuit with the U.S. Justice Department and five other states in August. He cited expectations that consolidation would lead to higher fares and fees.

At a news conference Tuesday at Dallas-Fort Worth International Airport, however, Abbott said the carriers have agreed to maintain present levels of service in Texas and to keep the Texas headquarters.

Fort Worth, Texas-based American Airlines is a major employer in the state, and Abbott is seeking the Republican nomination for governor.

The Justice Department's antitrust trial over the merger is still scheduled for Nov. 25.

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