American Airlines Group Inc (AAL)

[KingDMC]

Even if St. Luke’s and the Airlines succeed in claiming that out-of-market benefits are fair game for assessing merger effect, current merger law may still doom each merger. As Commissioner Wright explained in his speech, a merger may violate Section 7 of the Clayton Act “despite the fact that it increases consumer welfare because current law precludes counting efficiencies outside the relevant market.” This is because “the merging parties cannot rely upon consumer gains outside of the narrowly defined product market to defend the merger, even if the increase in consumer welfare is huge and dominates any potential anticompetitive effects.”

This was the last paragraph which stood out to me the most. Of course there was a lot more reading before this. I was saying wow to the last paragraph. I still feel confident with the trial and truly hope they can reach a settlement outside of court. I'm not sure if this ties into the big drop today, but it definitely could have spooked a few weak hands.