The Regulators may be the least of managements problems. AA management blithely entered into these discussions while completely ignoring the Scope clause in their own pilot union's collective bargaining agreement.
From the Allied Pilots Association (APA):
"APA’s current collective bargaining agreement precludes any joint business agreement between American Airlines and another carrier. The contract’s “Scope” clause explicitly states that “All flying performed by or on behalf of the Company or an Affiliate shall be performed by pilots on the American Airlines Pilots Seniority List.” The clause does contain a series of exceptions for code-sharing agreements, commuter affiliate operations and other situations, but does not include any exception for a joint business agreement.
“Thus far American Airlines management has not negotiated any agreement with APA that would permit the airline to enter into a joint venture with British Airways and Iberia."
Given the long-standing adversarial relationship between AA management and its unions a negotiated agreement isn't likely to happen quickly (vast understatement), if at all.