AT&T-Time Warner judge ‘got it wrong,’ DOJ official says

21 August 2018 8:35pm

20 August 2018. By Leah Nylen.

A district court judge who found that AT&T’s $85.4 billion** proposed merger with Time Warner wouldn’t harm competition “got it wrong,” a senior US Justice Department official said Monday in explaining why the agency launched a potentially risky appeal.

“We appealed it because we thought the judge got it wrong,” Deputy Assistant Attorney General Barry Nigro said at a conference* in Aspen, Colorado. “The foundation on which the decision is based has implications for how we do merger analysis. Do firms behave to maximize profits or don’t they? We assume they do. We believe some of the findings in the case were based on the assumption they don’t.”

US District Judge Richard Leon ruled in June that AT&T could move forward with its acquisition of Time Warner over the objections of US antitrust prosecutors. Last month, the Justice Department said it would appeal to the US Court of Appeals for the District of Columbia  Circuit. The decision was viewed as a risky one as a negative opinion by the DC Circuit would have wider implications for future merger challenges than Leon’s district court decision.

Nigro, whose remarks came in response to a question from MLex, acknowledged the potential risks of an appeal.

“Is there some risk that the DC Circuit may not find the way we would like them to find? There’s always that risk in litigation, but the principles are important enough and we feel strongly enough about them that we thought it was important to appeal the case,” he said.

Nigro also said that the US Federal Communications Commission weighed in for the first time last week, submitting an amicus brief that supports the Justice Department’s view.

“This case is important,” Nigro said. “There hasn’t been a vertical case litigated in 40 years. If nothing else, we’ll get some law and hopefully it will be good law.”

*2018 Aspen Forum: New Rules for the Digital Economy. Technology Policy Institute. Aspen, Colorado. Aug. 19-21, 2018.

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