Law likely on AT&T's side in Time Warner battle

Law likely on AT&T's side in Time Warner battle

The United States Justice Department's argument to block AT&T Inc's $85.4 billion acquisition of Time Warner Inc was "foolish" as the deal posed no threat to consumers, the wireless carrier's lawyer Dan Petrocelli told on Tuesday.

A day after his Justice Department sued to stop AT&T's purchase of Time Warner, President Donald Trump weighed in on the potential impact of the deal on the country. During his campaign, Trump said that reporters covered him unfairly and has continued to attack CNN as president, which he has labeled as "fake news".

The merger challenge is unusual since the two companies do not compete directly.

The White House has denied that Trump has discussed the merger with Attorney General Jeff Sessions, and the chief of the DOJ's antitrust division, Makan Delrahim, said that there was no interference by the White House in the decision to pursue a lawsuit.

AT&T is prepared to fight the suit in court.

Stephenson also fed speculation that the Justice Department may have been motivated by Trump's antipathy toward CNN. He has not commented on the AT&T deal since his inauguration in January.

The United States' second largest wireless carrier offered to buy Time Warner in October previous year to gain control of cable TV channels HBO and CNN, and film studio Warner Bros as well as a number of other coveted media assets.

Time Warner's shares were untraded.

The complaint's focus on raising the costs of DirecTV's rivals and hampering the move to online video is consistent with normal antitrust concerns, said Henry Su, a partner in the law firm Constantine Cannon. "They're espousing what we consider traditional theories of vertical harm", said Su.

Trump was also asked by reporters on Tuesday if Sen.

"The Department of Justice can anticipate a tough battle, but it deserves support for the goal of protecting against undue power", Blumenthal said in a statement.

The Justice Department has not successfully litigated to stop a vertical deal - where the merging companies are not direct competitors, as is the case with AT&T and Time Warner - since the 1970s, when it prevented Ford Motor Co from buying assets from spark-plug maker Autolite.

Delrahim, in a speech at the American Bar Association last week, said that he opposed those sorts of remedies because they smacked of regulation and were ineffective and a drain on government resources.

"People see the DoJ (the Justice Department) under Trump as less predictable (than) they thought", said a trader, who spoke on condition of anonymity to protect business relationships.



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