WASHINGTON--The Justice Department asked a federal judge to postpone proceedings Tuesday in the government's challenge to the merger of US Airways Group Inc. (LCC) and American Airlines' AMR Corp. (AAMRQ), citing a lack of funding because of the shutdown of the federal government.

The department, in a brief two-page filing, asked U.S. District Judge Colleen Kollar-Kotelly to stay all court proceedings "until Congress has restored appropriations."

The department noted that under the shutdown its employees were generally prohibited from working, even on a voluntary basis, except in limited circumstances, including "emergencies involving the safety of human life or the protection of property."

Department lawyers said that if the judge denies the stay request, they will continue to work on the case because her action would "constitute express legal authorization" for them to stay on the job.

The government's filing indicated the airlines objected to the request for postponement.

A status hearing in the case was scheduled for later Tuesday morning. The trial is set to begin Nov. 25.

The Justice Department argues the merger would harm industry competition and result in higher airfares, higher fees and fewer choices for consumers. The airlines say their merger will allow them to offer more flights to more destinations, reduce costs and offer lower prices and better service.

Write to Brent Kendall at brent.kendall@dowjones.com

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