Supreme Court Won't Hear Southwest CEO Subpoena Appeal

Supreme Court Won't Hear Southwest CEO Subpoena Appeal

Law360, New York (November 28, 2016, 4:44 PM EST) -- The U.S. Supreme Court declined Monday to hear an attempt by travel agents and consumers contesting American Airlines' acquisition of US Airways to force a former Southwest Airlines CEO to give a deposition in the case. 

The merger opponents argued in their Sept. 8 certiorari petition that the Fifth Circuit had erred in affirming a lower court’s decision to quash the subpoena for Herbert Kelleher because it would be an “undue burden” for him to have to give the deposition. The petitioners argued that the courts wrongfully based their determinations on the presumption that the information sought from his testimony could be obtained from “less burdensome” sources. 

The petitioners sought to question Kelleher on conversations, meetings and email exchanges he allegedly had with American and USAir officials over the merger and its potential impact on Southwest. They sought to question Kelleher about any promises or assurances that may have arisen from the interactions, and whether his testimony would corroborate or counter statements made by American and USAir officials in their own
depositions.

In August 2014, a federal magistrate judge in Texas — where the petitioners sought to conduct the deposition as a convenience to Kelleher — denied the request, saying the information sought could be obtained from other people and that Kelleher submitted an affidavit to the court in which he swore that he did not have conversations with the CEOs of American and USAir over the merger.

As is customary, the high court justices did not provide a reason for declining to take the case. 

“We’re happy this has come to a close,” Kelleher counsel Eric Pinker said in a phone interview Monday.

An attorney for the petitioners, Joseph Alioto, said in a phone interview Monday he was disappointed by the decision. He said the deposition would have taken two to three hours in a location of Kelleher’s choosing and would not have been a burden, and that the testimony would have provided the corroboration of the other CEO’s statements needed to legally establish conspiracy claims involving the merger. 

“The lower courts have ruled only one side of the conversation is sufficient,” he said. “We don’t believe this is the rule.” 

Alioto said even without Kelleher’s testimony the petitioners still had “substantial evidence” for their claims in the underlying case and that they anticipated going to trial in February. 

The petitioners argued in the underlying case, which they filed in August 2013 in the U.S. Bankruptcy Court for the Southern District of New York, that the merger violated Section 7 of the Clayton Antitrust Act because the deal would curb competition within the airline industry. 

The petitioners are represented by Joseph M. Alioto and Jamie L. Miller of the Alioto Law Firm. 

Kelleher was represented in the Fifth Circuit by Eric Wolf Pinker and Kent Davis Krabill of Lynn Pinker Cox & Hurst LLP. 

The case is Carolyn Fjord et al. v. Herbert Kelleher, case number 16-465, in the Supreme Court of the United States. 

The underlying case is Carolyn Fjord et al. v. AMR Corp. et al., case number 1:13-ap-01392, in the U.S. Bankruptcy Court for the Southern District of New York. --Additional reporting by Kevin Penton. Editing by Jill Coffey.