AT&T, Time Warner combo anti-competitive, DOJ says
In June, U.S. District Judge Richard Leon ruled that AT&T’s $85 billion acquisition of Time Warner could proceed with no concession or restrictions. In his opinion, Leon wrote, “If there ever were an antitrust case where the parties had a dramatically different assessment of the state of the relevant market and a fundamentally different vision of its future development, this is the one.”
Following on its announcement it would appeal the decision, U.S. Department of Justice lawyers on Aug. 6 filed a brief spelling out the grounds for the appeal and charing that Leon ignored “fundamental principles of economics and common sense. These errors distorted its view of the evidence and rendered its factual findings clearly erroneous…”
Essentially, the federal government says the acquisition, which gives AT&T ownership of high-value video content, including HBO, the Turner networks, CNN and Warner Bros., will create a market dynamic that hurts consumers.
According to the brief, “The merger will empower AT&T to use Time Warner’s valuable programming to raise its rival distributors’ costs for obtaining programming, while also enabling AT&T to protect its high-margin satellite television business [DirecTV] from competition by upstart rivals—all to the detriment of American consumers.”
DOJ lawyers said the result of the appeal “will shape the future of the media and telecommunications industries for years to come.”
In a statement, AT&T General Counsel David McAtee said, “Appeals aren’t ‘do-overs.’ After a long trial, Judge Leon weighed the evidence and rendered a comprehensive 172-page decision that systematically exposed each of the many holes in the Government’s case. There is nothing in DOJ’s brief today that should disturb that decision.”
Here’s a look back at Leon’s original ruling in favor of the AT&T, Time Warner deal.
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