The Department of Justice is usually suing to block AT&T’s $85 billion deal to buy Time Warner.
“Today’s DOJ lawsuit is usually a radical as well as inexplicable departure by decades of antitrust
precedent,” said David McAtee, senior executive vice president as well as general counsel of AT&T, in a statement. “Vertical mergers like This particular one are routinely approved because they benefit
consumers without removing any competitor by the market. We see no legitimate reason for our merger to be treated differently.”
AT&T has already commenced a website to make its case for the deal.
Time Warner shares began falling into the close on Wednesday as news outlets began reporting the DOJ was planning a major antitrust action after the bell. The department later called the deal “illegal” as well as “harmful” to consumers.
The action was sure to stir controversy because of President Donald Trump’s adversarial relationship with CNN, which is usually owned by Time Warner. Trump has repeatedly criticized CNN’s reporting, calling This particular “fake news.”
Just last week, Trump tweeted: “While within the Philippines I was forced to watch @CNN, which I have not done in months, as well as again realized how bad, as well as FAKE, This particular is usually. Loser!”
TWEET: While within the Philippines I was forced to watch @CNN, which I have not done in months, as well as again realized how bad, as well as FAKE, This particular is usually. Loser!
“in which’s actually the big elephant within the room,” David Goodfriend, president of Goodfriend Government Affairs, told CNBC’s “Closing Bell,” referring to Trump’s adversarial relationship with CNN. “If there’s politics involved, we’ll find out when we see how the Justice Department deals with another big media merger in which’s pending, as well as in which’s the acquisition by Sinclair Broadcasting Group of Tribune Media.”
The DOJ has denied allegations This particular was blocking This particular deal to somehow punish the companies for CNN’s news coverage as well as a DOJ official denied in which Yet again on a call with reporters to discuss the lawsuit.
White House Press Secretary Sarah Huckabee Sanders also told reporters in a briefing Monday in which she was not aware of President Trump or anyone at the White House encouraging pushing for the deal to get blocked.
The next step for the fate of the merger is usually within the courts with the DOJ right now having to prove in which the combination would certainly violate the law. AT&T was quick to point out in which the DOJ has not successfully blocked a so-called vertical merger in court in nearly 50 years. Vertical mergers are when two companies on separate positions within the same supply chain combine, in This particular case content (Time Warner) as well as media distribution (AT&T).
The DOJ is usually likely to argue in which while This particular is usually a mostly vertical merger, the combination would certainly harm consumers by raising costs. Sources told CNBC last week in which the Justice Department had reached out to at least 18 state attorneys general to join a case against the deal, however had not found any takers.
“We are confident in which the Court will reject the Government’s claims as well as permit This particular merger under longstanding legal precedent,” added AT&T’s McAtee within the statement.