The Biden administration filed a lawsuit Tuesday to block JetBlue Airways’ purchase of Spirit Airlines for $3.8 billion, alleging the deal would reduce competition and drive up air fares for consumers.

The Justice Department said the collaboration would especially harm cost-conscious travelers who rely on Spirit to find cheaper options than they can find on JetBlue and other airlines.

Attorney General Att. Gene.

Merrick Garland was scheduled to hold a press conference announcing the lawsuit, a sign of the importance the government places on halting further consolidation in the airline industry.

JetBlue and Spirit have been anticipating the government’s challenge for weeks. The government had previously requested additional documents and statements about JetBlue’s proposal to buy Spirit, the country’s largest low-cost airline. Negotiations for a possible settlement failed.

The Justice Department said in the lawsuit, filed in federal district court in Boston, that the deal would end direct competition between JetBlue and Spirit and eliminate Spirit, the nation’s largest ultra-low-cost carrier.

If the acquisition is approved, JetBlue plans to abandon Spirits’ business model, remove seats from Spirits aircraft and charge Spirits customers higher prices, the department’s lawyers wrote. “JetBlue’s plan would eliminate Spirit’s unique competition and approximately half of all ultra-low-cost airline seats in the industry and cause tens of millions of travelers to face higher fares and fewer options.”

As signs mounted that the government would challenge the partnership, JetBlue CEO Robin Hayes and other company executives launched a pre-emptive campaign to argue that the deal would help consumers by creating a stronger competitor for the four airlines that operate about 80% of the domestic aviation market.

Hayes said Tuesday he was disappointed but not surprised by the lawsuit.

When we got the offer that was approved by Spirit shareholders last year, we said we didn’t think we would close until the first half of 2024, pending a trial, he said on CBS Mornings.

The Justice Department was under pressure from Democratic lawmakers and consumer advocates who complained about a spate of previous mergers that regulators approved and allowed fewer airlines to control a larger share of the market. Government concerns about airline industry consolidation were reflected in 2021 when the Justice Department filed a lawsuit to end a limited partnership between JetBlue and American Airlines in the Northeast.

JetBlue continued to hope that the administration would backtrack on its argument that the combination with Spirit would be much smaller than other deals and help consumers by putting pressure on the larger airlines.

Together, JetBlue and Spirit would control just over 9% of the domestic aviation market, much smaller than American, Delta, United and Southwest. JetBlue executives repeatedly said their deal wasn’t like Pepsi was buying Coca-Cola, a phrase Hayes repeated on Tuesday.

They said the Justice Department had created the environment of four airlines dominating the market, and JetBlue just wanted a better chance to compete with the giants that all grew through mergers and acquisitions between 2008 and 2013.

The Justice Department filed a lawsuit to block the latest mega deal, the US merger with US Airways, and subsequently reached a settlement that required the airlines to give up some gates and takeoff and landing slots at several major airports. Before that, the government allowed Delta to buy Northwest

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United merged with Continental and later let Southwest buy AirTran.

Last year, JetBlue won a bidding war for Spirit against Frontier Airlines. Frontier Chief Executive Barry Biffle argued that regulators would block a JetBlue-Spirit deal, but not a partnership with fellow discount airline Frontier.

American and JetBlue are still awaiting the fate of a partnership that would allow them to work together on scheduling and revenue sharing in Boston and New York. A federal judge in Boston is expected to rule soon after a no-jury trial last fall.

Shares of all major U.S. carriers rose Tuesday after the lawsuit was filed, except for JetBlue, which fell slightly in late morning trading.