American Airlines (AAL+0.66%) and JetBlue (JBLU+3.07%) had been partners. Now they’ll be seeing one another in court.
From 2020 through 2024, the two airlines partnered on flights in and out of New York and Boston. The partnership—dubbed the Northeast Alliance—allowed customers to book on either airline, and the two companies shared revenue and booking codes. Customers could also rack up reward points on either airline.
A federal court pulled the plug on the original partnership in November, ruling it anti-competitive. The two airlines then tried to craft a new alliance, but the talks failed to produce an agreement.
American vice chair and chief strategy officer Steve Johnson said in a statement this week that the airline tried to work with JetBlue.
“Although we proposed a very attractive proposition to JetBlue and its customers and team, it became clear over time that JetBlue was focused on different business priorities,” Johnson wrote, adding that they were unable to agree on any sort of partnership that was consistent with the travel rewards and co-branded card business objectives.
Johnson added one final note – “in case you see it in the news” – to his statement:
“We filed a lawsuit against JetBlue today to recover money owed to American following the unwinding of the Northeast Alliance. We understandably tabled this claim while we were in discussions with JetBlue, but now that those conversations have concluded, we need to address the accounting and reconciliation following the termination of the NEA,” Johnson said.
According to a court filing, American Airlines is seeking over $1 million in damages for the loss of the Northeast Alliance.
In the lawsuit, American argues that JetBlue had refused to pay its final invoice per a revenue sharing agreement between the two companies. American alleged in the filing that those payments were due in January 2024.
JetBlue demurred on commenting about the specifics of the suit.
A spokesperson for JetBlue told Axios late Monday that the airline had “continued to work collaboratively with American to wind down the NEA” since the court’s ruling.
In addition to facing the $1 million suit from American, JetBlue was fined $2 million earlier this year by the Department of Transportation for ‘operating multiple chronically delayed flights.
Still, JetBlue may not be done partnering with larger airlines.
On Tuesday, JetBlue’s president, Marty St. George, said a new partnership with a different airline would be announced in the coming weeks. The new partnership, he said, will—like the defunct alliance with American—offer travelers in the Northeast more options.
“If you are a customer in the Northeast and you love JetBlue for leisure, but twice a year you have to go to Omaha or Boise, these are places that you can’t earn TrueBlue points on now, and when this partnership goes forward, you will be able to,” St. George said on the call. There was no word on how the new partnership will avoid being flagged by regulators.
JetBlue shareholders cheered the news, sending stock up 3 percent during trading.
The post American Airlines is suing JetBlue after a partnership fell apart appeared first on Quartz.
