Published: Sat, July 14, 2018
Economy | By

US Justice Dept. restarts AT&T-Time Warner antitrust fight

US Justice Dept. restarts AT&T-Time Warner antitrust fight

The U.S. Justice Department said on Thursday it would appeal a federal judge's approval of AT&T Inc's $85.4 billion United States acquisition of Time Warner, raising the prospect that the deal could be undone. The appeal is being led by District Court Judge Richard Leon.

"The court's decision could hardly have been more thorough, fact-based, and well-reasoned", AT&T General Counsel David McAtee said in a statement responding to the Justice Department's move. "While the losing party in litigation always has the right to appeal if it wishes, we are surprised that the (Justice Department) has chosen to do so under these circumstances".

Leon also wrote that if the DOJ appealed and won, the Circuit Court would have no qualms about unwinding the merger. Some analysts said it could reflect negatively on Leon's analysis of the case and possibly benefit the Justice Department. It's a very interesting and unexpected outcome but one to keep a watchful eye on going forward.

A Justice Department win at the appeals level would undo a stinging rebuke for the government and vindicate the decision by the head of the antitrust division, Makan Delrahim, to challenge the Time Warner takeover.

However, a court document filed today indicates that the Justice Department will appeal the decision. The transition to streaming services, away from traditional cable, is one that's costing pay TV companies millions of subscribers and billions in revenue every year. Trump has publicly feuded with Time Warner's CNN, calling it "failing" and a purveyor of "fake news". AT&T said it was prepared to defend the case on appeal. That apparently wasn't enough, however, to satisfy the Justice Department. President Donald Trump, on the campaign trail, repeatedly expressed reservations about the deal, which includes ownership of CNN, the news network that frequently draws Trump's ire. Just a day after Leon ruled, Comcast launched a $65 billion cash bid for the bulk of 21st Century Fox - topping Disney's all-stock $52.5 billion offer in December.

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