American Airlines Drops JetBlue Deal, Sues Over Northeast Alliance Fallout

American Airlines is officially ending its efforts to form a new partnership with JetBlue and has filed a lawsuit to recover money it says is owed from the wind-down of their Northeast Alliance (NEA).

In a letter to employees on Monday, Steve Johnson, American’s vice chair and chief strategy officer, said the airline is no longer pursuing a partnership with JetBlue, which he said “was focused on different business priorities.”

The two carriers had been operating under their Northeast Alliance until a U.S. District Court struck it down in 2024 over concerns about reduced competition. Shortly after the ruling, JetBlue terminated the alliance but said it was open to pursuing a different form of partnership.

Johnson’s letter ends those hopes.

“Ultimately, we were unable to agree on a construct that preserved the benefits of the partnership we envisioned, made sense operationally or financially, or was consistent with the travel rewards and co-branded card business objectives that are so important to our strategy and our customers,” Johnson wrote.

He added that American remains committed to “competing aggressively” in New York and Boston—two cities central to the now-defunct alliance. The airline plans to add routes at both LaGuardia (LGA) and John F. Kennedy International Airport (JFK), and to strengthen ties with international partners such as British Airways, Iberia, Qatar Airways, Alaska Airlines, and Hawaiian Airlines.

Johnson also revealed that American has filed a lawsuit against JetBlue to recoup funds allegedly owed from the dissolution 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,” he wrote.