UPDATED 20:47 EDT / JULY 18 2018

APPS

Justice Department seeks expedited appeal on AT&T Time Warner acquisition

The U.S. Department of Justice is attempting to expedite its appeal against the court ruling that approved AT&T Inc.’s $85 billion acquisition of Time Warner Inc. as the opportunity to unscramble the merger becomes harder with each passing day.

In a filing lodged with Court of Appeals Wednesday, the Justice Department argued that the federal judge who ruled in favor of the deal June 12 “rejected fundamental principles of economics” and that an expedited appeal was required “in order to preserve competition and clarify the proper analysis of vertical mergers.”

Timing is of the essence, as the filing noted that although AT&T and Time Warner have already finished their merger, AT&T has committed to keep separate its Turner division, which includes CNN, Cartoon Network and other cable television properties, pending an appeal. But that promise is only until Feb. 28 next year.

“The government’s case is based on well-accepted and non-controversial economic principles of bargaining,” the filing added. “But the district court effectively discarded those principles and their logical implication that the merged firm will raise prices to its rivals.”

Competition has been a theme since Justice first opposed the acquisition in November. It argued that AT&T, with control of Time Warner’s various networks, would begin charging its rivals more money and use its power to slow the progress of smaller, innovative video distribution businesses.

AT&T has long argued that this wouldn’t be the case and that the Justice Department’s arguments “stretch the very reach of antitrust law beyond the breaking point.”

As reported when Justice indicated that it intended to appeal, opposition to the deal brings together some interesting bedfellows. The Trump administration has been against the deal from day one, ostensibly for political reasons, but a wide variety of civic groups, many on the left, also oppose it on grounds concerning diversity in media, competition and net neutrality.

The Justice Department is seeking to have final briefs lodged in the D.C. Circuit Court of Appeals case by Oct. 18 with oral arguments to follow. Notably, AT&T supports the proposal to expedite the hearing.

Image: cerillion/Flickr

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