AT&T backs off political argument in antitrust case

Politics have been at the centre of the public debate about the Justice Department’s lawsuit to block AT&T’s $85 billion purchase of Time Warner. But the trial itself, starting later this month, is shaping up to be a fight focused on classic issues in antitrust law.

In court filings on Friday, the Justice Department and AT&T laid out the arguments that they plan to make in the trial. Regulators will argue that the deal will hurt competition and lead to higher prices. AT&T and Time Warner will counter those arguments by saying that even with a merger, it is an underdog against online giants like Facebook and Google.

“If TV-programme distributor AT&T acquires TV-programme producer Time Warner, American consumers will end up paying hundreds of millions of dollars more than they do now to watch their favorite programs on TV,” the Justice Department said in its brief submitted on Friday evening.

In its brief, AT&T countered by saying, “This merger has never been about making Time Warner programmes less accessible or more expensive. Just the opposite: It is about making Time Warner and AT&T more competitive during a revolutionary transformation that is occurring in the video programming marketplace.”

The trial, one of the biggest antitrust showdowns in decades, will begin March 19 in the United States District Court for the District of Columbia.

It is expected to last about three weeks.

Noticeably absent in AT&T’s filing was an earlier argument it had made: that the government singled out the company’s deal because of presidential politics. President Trump was a vocal critic of the deal during his presidential campaign, and while in office, he has consistently blamed CNN, a channel owned by Turner and part of Time Warner’s television business, for unfair coverage of his administration.

AT&T originally argued to the court that the Justice Department’s suit was a case of “selective enforcement” — that the government was essentially blocking the deal because the president was against it.

But late last month, Judge Richard J Leon, who is overseeing the trial, rejected demands by AT&T for detailed email and phone logs between the White House and the Justice Department related to the deal. AT&T and Time Warner has dropped “selective enforcement” as a defense, according to the new filings.

Even absent the question of presidential interference in the deal, the trial is pivotal for the telecom and media industries, providing a clue about the chances of other industry deals, like Disney’s bid for 21st Century Fox. AT&T’s chief executive, Randall Stephenson, and Time Warner’s chief executive, Jeffrey Bewkes, are expected to take the stand.

AT&T originally argued in court that the Justice Department’s suit was a case of ‘selective enforcement’