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Seven States Join Lawsuit Blocking AT&T, T-Mobile Merger

September 18, 2011

Seven states have joined the U.S. Justice Department in their antitrust lawsuit seeking to block AT&T’s attempted $39 billion takeover of T-Mobile, the AFP reported on Friday.

The attorney generals of California, Illinois, Massachusetts, New York, Ohio, Pennsylvania and Washington have been added to the legal action, filed in U.S. District Court in Washington in August.

“The participation of the states adds another dose of uncertainty to a deal that is already teetering on the edge of collapse,” CNET Reporter Roger Cheng wrote on Friday. “The Justice Department’s decision to oppose the merger has thrown AT&T for a loop, leaving the telecommunications giant scrambling to save the deal and rally supporters to its cause.”

Earlier this month, AT&T filed a response to the lawsuit, arguing that the acquisition of T-Mobile would allow them to gain more spectrum and provide wireless broadband access to a greater number of people in the U.S. They also accused the Justice Department of, in Cheng’s words, “painting an inaccurate picture of the deal” and denying that it would harm competition in the industry.

In a statement, cited by AFP, the Justice Department said, “We have had an excellent working relationship with a number of state attorneys general and they have provided invaluable assistance throughout our investigation.”

“We are pleased that these states have joined the department in its lawsuit,” it added. “Together, we will seek to protect consumers from the anti-competitive harm that would result from this proposed transaction.”

U.S. District Court Judge Ellen Huvelle has ordered lawyers from both telecom companies and the Justice Department to attend a meeting this Wednesday, where they will discuss a possible settlement. Should the case go to trial, the AFP reports the Justice Department has requested a March 19, 2012, start date, while AT&T has proposed a January 16, 2012 trial date.

“It is not unusual for state attorneys general to participate in DOJ merger review proceedings or court filings,” an AT&T representative told CNET. “We have been and remain interested in a solution that addresses the DOJ’s issues with the T-Mobile merger.”

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Source: RedOrbit Staff & Wire Reports



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