U.S. Justice Department sues to block American - US Airways merger

The Justice Department and several states have filed a lawsuit to halt the proposed merger of American Airlines and US Airways. 

The Justice Department says the deal would result in the creation of the world's largest airline and that a combination of the two companies would reduce competition for commercial air travel in local markets and would result in passengers paying higher airfares and receiving less service.

The two airlines announced their plans in February and have been moving toward a merger while awaiting regulatory approval.

US Airways and American had argued the $14.3 billion merger posed no threat to competition at Reagan and that forcing them to surrender slots would result in fewer flights to mid-sized and small cities.

US Airways shareholders approved the merger July 12, and American’s creditors endorsed it in a vote announced on August 1