In 1990, Spirit Airlines began as a small, low-fare passenger airline. By 1996 it had experienced modest
Question:
In 1990, Spirit Airlines began as a small, low-fare passenger airline. By 1996 it had experienced modest success and had grown to include 11 planes and about 455 employees. In 1995 and 1996, it expanded its routes to include the Detroit- Philadelphia market, which was also served by Northwest Airlines. Northwest was the fourth largest air passenger carrier in the United States, and held 72 percent of the Detroit-Philadelphia market. About six months after Spirit began the new route, Northwest dropped its lowest fares on that route from \($189\) to \($49,\) the same price as Spirit, and three months later Spirit abandoned the route. Following Spirit’s exit, Northwest raised the lowest fair to \($271\) and later to \($461.\) Of what anticompetitive practice might Northwest be accused? Under which section(s) of which act(s) do you think Spirit might have brought suit?
Step by Step Answer:
The Legal And Ethical Environment Of Business
ISBN: 9781454893028
2nd Edition
Authors: Gerald R. Ferrera, Mystica M. Alexander, William P. Wiggins, Cheryl Kirschner, Jonathan J. Darrow