Delta Air Lines Acquisition of Northwest Airlines

Compass Lexecon was retained by both Delta Air Lines and Northwest Airlines in connection with their proposed merger to become the world’s largest airline. Bobby Willig, Dan Rubinfeld, Jon Orszag, Theresa Sullivan, Steve Peterson, and Bryan Keating, along with others in Chicago, Washington, DC, and Boston, were retained by Tim Muris and Christine Wilson of O’Melveny & Myers LLP and Hew Pate and Bruce Hoffman of Hunton & Williams LLP to assist Delta and Northwest in the merger review process. David Painter and Paul Anderson, working with counsel for both parties, helped evaluate the magnitude and merger specificity of the cost savings likely to result from the deal. The DOJ cleared the merger, concluding that “the merger likely will result in efficiencies such as cost savings in airport operations, information technology, supply chain economics, and fleet optimization that will benefit consumers.” Dennis Carlton, supported by Mark Israel, David Fenichel, Eugene Orlov, Kirupa Ramaiah, Dan Stone, and Wendy Petropoulos, was retained by Don Flexner and Jim Denvir of Boies, Schiller & Flexner LLP and Henry Thumann of O’Melveny & Myers LLP to assist in the private litigation seeking to block the Delta-Northwest merger. Dr. Carlton showed that the report of the plaintiffs’ expert had presented a theory of harm wholly inconsistent with the economics literature, as well as the facts of the industry and the proposed merger. Dr. Carlton also showed, using state-of-the-art econometrics, that the Delta-Northwest merger would produce significant benefits for consumers.