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DOJ Appealing AT&T-TW Court Ruling

The Justice Department has decided to appeal the court decision allowing the AT&T-Time Warner merger.

The deal closed soon after the judge rendered his decision June 12, and Justice chose not to seek a stay after the judge signaled it would not get one.

The judge concluded in a 172-page decision that DOJ "failed to meet its burden to establish that the proposed transaction is likely to lessen competition substantially," and thus declined to enjoin the merger.He found the government’s evidence unpersuasive and itswitness testimony unsupported, or even contradicted, by evidence.

The DOJ had said the deal should not be allowed because the combined company would be able to raise prices or restrict access to that high-value programming, including online. Antitrust Chief Makan Delrahim had signaled following the decision that DOJ had a commitment to preserving competition, something he felt the deal did not do.'

“The Court’s decision could hardly have been more thorough, fact-based, and well-reasoned," said David McAtee, AT&T General Counsel. "While the losing party in litigation always has the right to appeal if it wishes, we are surprised that the DOJ has chosen to do so under these circumstances. We are ready to defend the Court’s decision at the D.C. Circuit Court of Appeals.”

The Open Markets Institute, which called for the appeal, has said that it "is critical not only for maintaining the existing level of competition in video distribution, but also for ensuring that antitrust remains a strong tool against anticompetitive vertical mergers.”

“The AT&T-Time Warner transaction is a bad deal for consumers and competition," said Public Knowledge senior counsel John Bergmayer. "Since it has gone forward, AT&T has already raised prices for its DirectTV Now video service, more than doubled the mysterious ‘administrative fee’ it tacks on to most of its wireless bills, and raised the price of some of its wireless plans while removing the HBO subscription that it had previously included. Judge Leon’s decision contained numerous errors, and we believe the DOJ’s position should be vindicated.”

“U.S. District Court Judge Leon made clear errors in judgment when approving the AT&T-Time Warner merger," said Michael Copps, former FCC chairman and currently a special adviser to Common Cause. "His decision has already led to competitive harms in the marketplace, forcing consumers to pay higher prices. The DOJ’s appeal is positive news, and grounds for at least some hope, but there are miles to go to undo the damage Judge Leon’s decision inflicted. We support the DOJ’s appeal of this erroneous decision and urge the DC Circuit to quickly take up and reverse this transaction.”

John Eggerton
John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.