United States v. American Airlines, Inc.

United States v. American Airlines, Inc.

Opinion

 [*656]  Order

 HILL, D.J.:

Came on for consideration before the Court the motion of defendants Robert Crandall (Crandall) and American Airlines, Inc. (American) to dismiss the action for failing to state a claim upon which relief can be granted. Having considered the pleadings and briefs, and the relevant case law, this Court is of the opinion that the motion should be granted.

I. Preparation for Takeoff -- The Flight Plan

The Government filed this action under Section 4 of the Sherman Act, 15 U.S.C. § 4, to enjoin and restrain American and Crandall from further violations of Section 2 of the Sherman Act, 15 U.S.C. § 2. The complaint alleges Crandall, acting as Chief Executive Officer of American, unlawfully attempted to monopolize airline passenger service to a number of cities served from the Dallas/Fort Worth Regional Airport by requesting that Howard Putnam (Putnam), Chief Executive Officer of Braniff Airways, Inc. (Braniff), raise Braniff's prices, while assuring Putnam that American would follow suit. The Government seeks as relief to enjoin American from employing Crandall for a period of twenty-four months and to enjoin American from [**2]  communicating any price information with a competitor for a period of ten years.

The Government's case is based on a telephone conversation between Crandall and Putnam that took place February 1, 1982. In that conversation, which Putnam taped, the following exchange took place:

Crandall: I have a suggestion for you. Raise your * * * fares twenty percent. I'll raise mine the next morning.

Putnam: We can't talk about pricing.

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