Justice Department Files Lawsuit to Block JetBlue’s Acquisition of Spirit Airlines

The United States Department of Justice has filed a lawsuit to halt JetBlue’s $3.8 billion bid to acquire Spirit Airlines. It has been over 20 years since the government last intervened to prevent a merger between US airlines.

Attorney General Merrick Garland announced the lawsuit on Tuesday. President Joe Biden’s administration has long advocated for increased competition among businesses, particularly in the airline industry, to protect consumers and reduce prices

Spirit Airlines is well-known for providing customers with affordable flight options and is the country’s largest ultra-low-cost competitor to major carriers. Garland is concerned that the merger will negatively impact customers who rely on the company’s affordable fares.

“If not blocked, the merger of JetBlue and Spirit would result in higher fares and fewer choices for tens of millions of travelers across the country. The Justice Department is suing to prevent that from happening. Companies in every industry should understand by now that this Justice Department will not hesitate to enforce antitrust laws and protect American consumers.”

Within the last 22 years, five airline mergers have been allowed by the Justice Department, resulting in the consolidation of nine major airlines into four national carriers in the United States (American Airlines, Delta Airlines, United Airlines and Southwest Airlines). Currently, around 80% of all domestic flights in the U.S. are serviced by just four airlines.

JetBlue argues that the new merger would create a stronger competitor to those four major airlines, causing fares to fall rather than rise. According to JetBlue, due to the four airlines dominating the U.S. market, JetBlue and Spirit can only compete with each other rather than larger carriers.

However, according to the lawsuit, average fares on routes have fallen by 17% once Spirit began to serve them.

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To foster healthy competition, the company has proposed forfeiting landing and takeoff slots and gates at overcrowded airports to other low-cost airlines.

“The combination of JetBlue and Spirit plus the rapid growth of ultra-low-cost carriers will assure increased competition and low fares,” JetBlue said in a statement.

“JetBlue’s combination with Spirit allows it to create a compelling national challenger to these dominant airlines while also ensuring ultra-low-cost carrier options remain available in overlap markets. While JetBlue, with its highly unique combination of low fares and great service, will be able to expand with new national breadth as a result of the transaction, it will remain a significantly smaller player than each of the Big Four airlines. According to the data, a combined JetBlue and Spirit will have only about 9% market share, compared to about 16-24% for each of the four largest airlines, but the added scale and ability to further grow will result in meaningful competition on more routes to more destinations and greater opportunities for Crewmembers and Team Members of both airlines.”

JetBlue plans to close its deal with Spirit by the year’s end and hopes to get the lawsuit dismissed by then. The merger would form the fifth-largest airline in the U.S.. JetBlue has also spent the past 18 months defending itself against a separate lawsuit brought forward by the Justice Department alleging its Northeast alliance with American Airlines is predatory.

The Justice Department claims that the two airlines conspired to increase prices and limit options for travelers flying to and from major Northeastern cities in the United States. The companies traded information on flight schedules, pilot rosters, and aircraft sizes to use for each flight. They also shared revenues earned at these airports and pooled their gates and takeoff/landing authorizations.

“Approximately 75% of JetBlue’s total capacity is tied up in the Northeast Alliance,” the Justice Department stated in the recent lawsuit.

“That means JetBlue today coordinates its capacity decisions and shares its revenues with American Airlines on the vast majority of its flights. In other words, JetBlue no longer competes with American Airlines on those flights — and if this acquisition happens, Spirit won’t either.”

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Initially, Spirit Airlines was opposed to the merger with JetBlue on the grounds that it would increase fares and therefore present too many obstacles for regulatory approval. Instead, it planned to merge with Frontier Airlines—another ultra-low-cost airline carrier. However, it has now abandoned that plan since JetBlue outbid Frontier Airlines.

In his statement, Garland referenced the Spirit Airlines board’s statement back when they opposed the merger with JetBlue.

“A court will be very concerned that a JetBlue-Spirit combination will result in a higher cost, higher fare airline that would eliminate a lower cost, lower fare airline and eliminate about half of lower cost capacity in the United States.”

“We agree,” Garland added after reading the quote.

Principal Deputy Assistant Attorney General Doha Mekki of the Justice Department’s Antitrust Division stated, “This transaction occurs against the backdrop of years of airline consolidation in the United States.”

“JetBlue’s proposed acquisition of Spirit eliminates a disruptive, low-cost option for millions of Americans. Whether they fly Spirit or not, travelers throughout the United States benefit from an independent Spirit because where Spirit competes, other airlines – including JetBlue – are forced to compete more vigorously by lowering fares, offering greater innovations and delivering more consumer choice.”

The Justice Department and two other federal agencies—the Department of Transportation and the Federal Communications Commission—will need to approve the deal before it can be finalized. However, the decision ultimately rests with the federal courts that will hear the case.


Texas Sues Google Over Facial Data Collection

The state of Texas is suing Google for illegally collecting Texans’ facial and voice recognition information without their consent, according to a statement issued by the state attorney general’s office on Thursday.

For over a decade, a Texas consumer protection law has barred companies from collecting data on Texans’ faces, voices or other biometric identifiers without receiving prior informed consent. Ken Paxton, the state’s attorney general, said Google violated this law by recording identifiers such as “a retina or iris scan, fingerprint, voiceprint, or record of hand or face geometry.

“In blatant defiance of that law, Google has, since at least 2015, collected biometric data from innumerable Texans and used their faces and their voices to serve Google’s commercial ends. Indeed, all across the state, everyday Texans have become unwitting cash cows being milked by Google for profits.”

The law imposes a $25,000 fine for every violation. According to reports, millions of users in Texas had their information stored. The complaint explicitly references the Google Photos app, Google’s Nest camera, and Google Assistant as means of collection.

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A spokesman for Google, José Castañeda, accused Paxton of “mischaracterizing” products in “another breathless lawsuit.”

“For example, Google Photos helps you organize pictures of people by grouping similar faces, so you can easily find old photos. Of course, this is only visible to you, and you can easily turn off this feature if you choose and we do not use photos or videos in Google Photos for advertising purposes. The same is true for Voice Match and Face Match on Nest Hub Max, which are off-by-default features that give users the option to let Google Assistant recognize their voice or face to show their information. We will set the record straight in court.”

This lawsuit is the latest in a string of major cases brought against the company. Earlier this month, Arizona settled a privacy suit against Google for $85 million. Indiana, Washington and the District of Columbia also sued Google in January over privacy invasions related to location tracking.

In a much larger antitrust case, 36 states filed a lawsuit against Google in July over its control of the Android app store.

Paxton has gone after large technology corporations in the past for their privacy and monopolizing practices. In 2020, his office joined nine other states in filing an antitrust lawsuit against Google, which accused it of “working with Facebook Inc. in an unlawful manner that violated antitrust law to boost its already-dominant online advertising business.”

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After the Jan. 6 insurrection, Paxton demanded Twitter, Amazon, Apple, Facebook and Google to be transparent about their content moderation procedures. This year, he also opened an investigation into Twitter over its reported percentage of fake accounts, saying that the company may be disingenuous about its numbers to inflate its value and raise its revenue.

In February, Paxton sued Meta for facial recognition software it provided users to help tag photos. The lawsuit is ongoing. However, Instagram is now required to ask for permission to analyze Texans’ facial features to properly use facial filters.

“Google’s indiscriminate collection of the personal information of Texans, including very sensitive information like biometric identifiers, will not be tolerated. I will continue to fight Big Tech to ensure the privacy and security of all Texans.”

In 2009, Texas revealed its privacy law, which covered biometric identifiers. Other states were implementing similar laws around the country during this same time. Texas was unique in that in the case of violations, the state of Texas would have to sue on behalf of the consumers.

Zillow Facing Antitrust Lawsuit After Accusations Of Favoring Certain Listings 

A real estate startup company is suing Zillow within a federal court over allegations that the website is violating antitrust laws by “deceptively steering customers to home listings from a subset of agents.” 

The suit was filed in a US federal court in Seattle in which the startup Rex alleges that Zillow and its affiliate Trulia are illegally favoring certain listings by brokers who belong to the National Association of Realtors (NAR); the most prominent US real estate trade association. The startup has claimed that non-NAR real estate agents are now located in a “hidden tab” on the website. 

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Rex’s general council Mike Toth was recently interviewed to discuss the suit regarding one of the nation’s most popular real estate listing websites. “The change by Zillow and Trulia forces all non-NAR listings to have permanent low visibility. This is the real estate web returning to this old vision of data segregation rather than data democratization for consumers.”

The suit could potentially shift the way in which certain online real estate platforms operate and allow more opportunities to arise for more buyers and sellers to negotiate the type of agent they want. Zillow and Trulia account for 75% of the online home search market in America, and when they made changes to their sites in the beginning of January, listings began being segregated to hidden areas of the site. 

“Zillow and Trulia started segregating listings, giving preferential treatment to the 1.3 million real estate agents who belong to NAR. Other listings, including those posted by brokers not affiliated with NAR, foreclosures and homes listed for sale by owners without agents, are now relegated to a separate tab. We are asking the court to block Zillow and Trulia from segregating listings,” Rex claimed. 

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NAR has their own real estate listing site,, which is the second-most viewed site for agents throughout the nation. That platform is known for only showing listings by NAR’s agents, and understandably so considering it’s their own website. So the issue now is that the changes Zillow and Trulia made means that three out of the four most popular real estate listing sites are favored for NAR’s agents and their listings exclusively. 

Those listings in particular tend to be more expensive because they require the seller to pay a commission, often 6% of the homes sale price, which is split between the agents of the buyer and seller. Rex has now raised these antitrust concerns with the Justice Department and 35 state attorney generals. 

Viet Shelton is a spokesperson for Zillow who claims the company “made the change in January after it became a participant in the Multiple Listing Services Internet Data Exchange feeds, which are operated by NAR. Zillow’s rules for the IDX feeds require participants to segregate listings. Zillow is committed to giving consumers the most up-to-date housing information on the most amount of listings possible on a single platform. We made changes to the way some listings appear on the site in order to be compliant with MLS rules.” The suit will likely begin unfolding within the next month or so.


Tech Companies Face Threat of Regulators

As time goes on, the cutting edge of technology has proven to become an essential part of our daily lives. As such, the massive corporations that produce this technology continue to grow even bigger and more influential. Amazon, for instance, plans to fill 30,000 open positions in the United States before the end of the year, and Google’s Android operating system powers roughly half of all smartphones. As these companies grow more powerful, so too do their potential to commit business practices that are anti-competitive or infringe upon the rights of consumers. Accordingly, some governmental bodies are initiating antitrust investigations against Amazon, Apple, Facebook, and Google in response to concerns about corruption and fraud.

Amazon dominates the online shopping market by offering a massive selection of products, lower prices than its competitors, and a Prime membership that includes free two-day shipping as well as unlimited access to streaming music and video content. In addition to its own products, the company sells products from Amazon warehouses as well as through third-parties. However, the company has recently come under fire due to claims that it unfairly promotes its own products over products by other manufacturers in search results and in its recommendation algorithm. More specifically, Italy’s antitrust authority is investigating whether or not the company gives preferential treatment to retailers that use Amazon’s fulfillment network, rather than outside shipping and handling services. Amazon claims that the reason these retailers do better on the site is that their consumers prefer their fulfillment network to others, but investigators are skeptical.

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Similarly, Apple has drawn controversy over the iron-clad grip the company maintains over its App Store, which requires developers to adhere to strict guidelines and which seems to highlight apps developed by Apple more prominently than apps developed by third parties. The company maintains that it has the right to curate content on its marketplace as stringently as it pleases, and does so to reduce the incidence of fraudulent or otherwise harmful applications. However, regulators worry that this practice unfairly mitigates the potential success of competing developers, and several software companies, such as Spotify, have issued formal complaints.

Facebook, on the other hand, is facing criticism for its history of acquiring smaller social networking services and integrating them into their platform, expanding their reach and influence. The Federal Trade Commission is looking into the company’s pattern of acquiring other businesses, including Instagram and WhatsApp, to determine whether these purchases constituted anticompetitive practices. Given the company’s dominance in the realm of social networks, it’s challenging for smaller start-ups to gain traction, and potentially even more so in the event of violations of antitrust laws.

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Google, too, has been accused of modifying its search result pages unfairly, giving the impression of presenting content objectively while actually giving prominence to results that benefit the company financially. As time has progressed and the company’s business model evolved, the search engine transitioned from mostly providing users with links to other websites towards responding to users’ search queries directly. While this approach serves consumers better and more quickly, it also raises questions about whether this monopolization of information in search results creates an opportunity for the company to shape public opinion for the company’s benefit. Both the FTC and the European Union have investigated Google; the company settled with the former organization, which did not conclude there was harm to customers, and the EU fined Google for favoring its shopping service over others. Additionally, given the near-total dominance of Android among smartphone manufacturers that are not Apple, there are concerns that the company is a monopoly in this field.

This article is based on information from the New York Times article, How Each Big Tech Company May Be Targeted by Regulators.