The Brazilian Federal Court of Appeals has for the second time overturned a ruling by the 24th Federal Civil Court of São Paulo.

A judge in the 24th Federal Civil Court granted an injunction on Thursday, blocking the proposed tie-up between Embraer and U.S.-based Boeing, a deal the Brazilian company says is crucial to its survival. 

The Court of Appeals has since overturned the injunction, allowing the deal to continue.

The Court of Appeals overturned a similar decision by the same judge earlier this month.

Brazilian labor unions originally argued that the transaction would transfer Embraer’s control out of the country to Boeing and cut jobs in Brazil. The lawsuit was brought by four Members of Congress with Brazil’s left-wing Workers Party.

“The company will take all applicable judicial measures to revert this decision and will keep its shareholders and the market informed on any material developments related to the public civil action,” Embraer said in a statement.

The original deal, wirth USD$4.75 billion, would give Boeing 80% of Embraer’s Commercial Aircraft Services Operations.

Embraer’s military component will remain under the control of existing shareholders, with the government in Brasilia holding a majority stake.

Boeing and Embraer signed the partnership to compete with the Airbus-Bombardier partnership, which was finalized airliner this year.

Featured image by Boeing

Categories: Industry Talk