updated 6/18/2008 7:12:37 PM ET 2008-06-18T23:12:37

A group of airline passengers sought to scuttle Delta Airlines Inc.'s proposed takeover of Northwest Airlines Corp., alleging in a federal lawsuit filed Wednesday that the deal would result in an illegal monopoly.

The passengers allege in the lawsuit filed in San Francisco that "higher ticket prices and diminished service" will result if federal regulators approve the deal.

The two airlines announced April 14 that their combined "enterprise value" would be $17.7 billion, including both companies' market values and their debt. The combined company, to be called Delta, would have the most flights worldwide, with 390 destinations in 67 countries.

The lawsuit, filed by 28 passengers, alleges that after the deal Delta would have a monopolistic grip on the industry, controlling 24 percent of domestic flights — and that would reduce competition.

"The potential for increased price-fixing, division of markets and other anticompetitive acts among the remaining airlines is significant," the lawsuit alleges.

Delta spokeswoman Betsy Talton said the company hasn't seen the lawsuit and doesn't comment on pending litigation. She called the proposed takeover of Northwest "pro-consumer" and said it "is the most compelling way to build a strong, long-term airline."

Northwest spokeswoman Tammy Lee called the lawsuit "frivolous" and said that since the routes the two carriers' flights overlap very little, few will be lost.

"This actually promotes consumer choice, it doesn't diminish it," Lee said.

Some lawmakers are concerned the combination and others that may follow will result in job cuts and higher ticket prices.

Minnesota Congressman James Oberstar, a Democrat and chairman of the House Transportation committee, called this month on the Justice Department to reject the deal.

Antitrust concerns have sunk such deals before. In 2001, an attempt to merge United Airlines and US Airways fell apart amid concerns that the combined carrier would control too much of the Washington market and dominate several other key routes.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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