Delta Air Lines Lawsuit Over Mexico Routes: DOT Order and Appeals Stay

The Delta-Aeromexico joint venture lawsuit is a federal appeals challenge in which Delta Air Lines and Aeromexico are asking the U.S. Court of Appeals for the Eleventh Circuit to overturn a September 15, 2025 order from the U.S. Department of Transportation that revoked the antitrust immunity underpinning their cross-border partnership. The airlines filed their petition on October 9, 2025, won an emergency stay on November 12, 2025 that keeps the joint venture running, and are set for oral arguments on June 23, 2026 in Jacksonville, Florida.¹

What the DOT Ordered

The DOT’s September 2025 order terminated the antitrust immunity the agency granted the two carriers in December 2016. That immunity had let Delta and Aeromexico operate as a single commercial entity on U.S.-Mexico routes, coordinating fares, sharing revenue, jointly managing capacity, and aligning their frequent flyer programs.²

The order set a wind-down deadline of January 1, 2026, by which the carriers had to stop all “competitively sensitive activities”: joint pricing, capacity management, and revenue sharing.³ The order stopped short of forcing a full breakup. Delta could keep its 20% equity stake in Aeromexico, both carriers could continue flying their existing U.S.-Mexico schedules, and arm’s-length cooperation such as codesharing, marketing agreements, and frequent flyer reciprocity was permitted to continue.⁴

Why the DOT Pulled Immunity

The DOT’s stated reason was that the Mexican government had been violating the 2015 U.S.-Mexico Air Transport Agreement since 2022, and that those violations had distorted the market in ways that gave the immunized joint venture an unfair edge. Two Mexican actions at Benito Juárez International Airport in Mexico City drove the DOT’s analysis.

The first was Mexico’s February 2023 eviction of all-cargo freighter operators from the airport, forcing them to relocate to the newer Felipe Ángeles International Airport. The DOT called the move a “carve-out” that benefited Mexican carriers because belly cargo on passenger flights was exempted from the ban.⁵ After the ban took effect, the DOT said the joint venture’s share of U.S.-Mexico City cargo rose to 73%.⁶

The second was a series of slot reductions at the same airport, cutting allowable aircraft movements from 61 per hour to 52 and then to 43. The DOT called these cuts “arbitrary” and “State-directed market intervention” aimed at pushing traffic toward the underused Felipe Ángeles facility.⁵ Mexico justified both actions on congestion and safety grounds, but the DOT rejected that explanation, saying Mexico had produced no analysis showing the airport was oversaturated and no assurance that U.S. carriers would eventually recover their slots.⁷

Because the joint venture controlled roughly 60% of passenger flights between Mexico City and the United States, the DOT found the partners were uniquely positioned to benefit from a market that had been artificially restricted for everyone else. The agency concluded that “higher fares, reduced capacity and impediments to new entrants were not just possible, but likely.”⁴ Transportation Secretary Sean Duffy called antitrust immunity “an extraordinary authority — not a right” and said, “After years of taking advantage of the U.S. and our carriers, we need to see definitive action by Mexico that levels the playing field and restores fairness.”³

What Delta and Aeromexico Are Arguing

The airlines filed their petition for review in the Eleventh Circuit on October 9, 2025, as case number 25-13546, alleging that the DOT violated the Administrative Procedure Act.⁸ They told the court they would suffer “severe irreparable harm” if forced to unwind operations by the January deadline, describing themselves in court filings as “inextricably a single entity in the cross-border market.”⁹

Delta backed the harm claim with specific numbers. The airline said dissolving the joint venture would cost nearly 4,000 U.S. jobs, erase more than $310 million from U.S. gross domestic product, and eliminate up to $800 million in annual consumer benefits. Delta also warned the court that as many as two dozen routes would be canceled and that smaller aircraft would replace larger ones on routes that survived.¹⁰

The DOT’s Response

In a November 3, 2025 filing, the DOT defended its authority as “broad” under 49 U.S.C. §§ 41308 and 41309 and argued that the competitive conditions justifying the 2016 approval no longer existed. The agency called the airlines’ harm claims “overblown” and “speculative,” pointing out that Delta’s 20% equity stake in Aeromexico and both carriers’ continued membership in the SkyTeam alliance meant they could still cooperate through standard arm’s-length arrangements. The DOT also argued that the joint venture had failed to deliver the consumer benefits promised at the time of approval when measured against what non-immunized competitors had achieved.⁶

The Stay That Keeps the Partnership Running

Delta and Aeromexico filed emergency stay motions on October 24, 2025, asking the court to prevent the January 1 dissolution deadline from taking effect. On November 12, 2025, a three-judge panel of the Eleventh Circuit granted the stay, citing the Supreme Court’s standard from Nken v. Holder.¹ The order froze the DOT’s action. The airlines did not have to unwind anything, and the joint venture continues to operate exactly as it did before the DOT order.¹¹

The stay was more than a procedural pause. A Government Accountability Office report found that as of 2019, the DOT had granted antitrust immunity to airline joint ventures 31 times since 1993, but the report identified no instance in which the agency had previously revoked active immunity.¹² The Delta-Aeromexico revocation appears to be the first of its kind, and the court’s willingness to pause it suggests real uncertainty about whether the DOT stayed within its authority.

The Legal Question the Court Has to Answer

The DOT’s power over international airline joint ventures comes from 49 U.S.C. §§ 41308 and 41309. Under those statutes, the agency can grant antitrust immunity when it is “required by the public interest” and must disapprove agreements that “substantially reduce or eliminate competition” unless the agreement serves a serious transportation need that cannot be met through less anticompetitive means.¹³ DOT orders have always stated that immunity may be amended or revoked at any time.¹²

The closest precedent is the 2018 D.C. Circuit decision in ABC Aerolineas, S.A. de C.V. v. DOT, which upheld the DOT’s “broad discretion” to condition immunity grants in ways that promote competition when Interjet challenged the slot divestiture conditions attached to the original Delta-Aeromexico grant.¹⁴ That case involved conditions on a grant, not a revocation. Whether the DOT’s discretion reaches as far when yanking immunity away is one of the central questions the Eleventh Circuit will need to answer.

Where the Case Stands Now

Briefing has closed. Delta and Aeromexico filed their opening brief on December 29, 2025, the DOT filed its response on January 28, 2026, and the airlines filed their reply on February 18, 2026. In February 2026, the carriers asked the court to void the DOT’s dismantling order entirely.⁹ On April 1, 2026, Judge Embry Kidd granted a motion to expedite the appeal and agreed to schedule oral argument at the earliest available date.¹⁵ Those arguments are set for June 23, 2026 in Jacksonville, Florida.¹

A diplomatic development has complicated the picture. On May 5, 2026, the United States and Mexico reached a preliminary understanding through a Memorandum of Consultations. Mexico committed to running its Mexico City airport slot process in line with international best practices, giving U.S. carriers “fair and transparent access” to slots, and returning all rescinded historic slots to U.S. airlines.¹⁶

On June 4, 2026, Delta and Aeromexico filed supplemental authority with the court referencing that memorandum, and the DOT responded on June 15.¹ The airlines’ position is that Mexico’s commitments undercut the DOT’s rationale for revoking immunity in the first place. Secretary Duffy has signaled skepticism that promises alone are enough, saying the U.S. needed to see “promises turn into action” and that restrictions would stay in place until Mexico “operationalized the reforms.”¹⁶ How the Eleventh Circuit weighs that diplomatic development against the underlying legal questions about the DOT’s revocation authority will shape the outcome of a case with no direct precedent.

1
CourtListener. Delta Air Lines v. U.S. Department of Transportation, 25-13546
2
U.S. Department of Transportation. DOT Grants Antitrust Immunity to Delta-Aeromexico
3
U.S. Department of Transportation. Trump’s Transportation Secretary Sean P. Duffy Enforces America First Agenda
4
Aviation Week. DOT Ends Delta-Aeromexico Joint Venture Citing Market Distortions
5
Air Insight. US Halts 13 Mexican Routes, Cites Arbitrary Slot Reductions and Cargo Ban at Mexico City Airport
6
CCH. Delta v. DOT Filing
7
FreightWaves. US Cargo Airlines Welcome DOT Aviation Sanctions on Mexico
8
Eckert Seamans. Federal Circuit Court Stays DOT Order Terminating Delta-Aeromexico Antitrust Immunity
9
CH-Aviation. US Court Halts Unwinding of Aeromexico-Delta Joint Venture
10
Reuters. Trump Administration Orders Delta, Aeromexico End Joint Venture by January 1
11
Aerotime. Delta Aeromexico JV Court Stay DOT Order
12
U.S. Government Accountability Office. GAO-19-237
13
Regulations.gov. DOT-OST-2015-0070-0342 Attachment
14
U.S. Department of Transportation. DOT Litigation News
15
Flight Global. Judge Expedites Delta-Aeromexico Joint Venture Appeal, Agrees to Oral Hearing
16
U.S. Department of Transportation. Trump’s Transportation Secretary Sean P. Duffy Preliminary Aviation Understanding