Appeals Court Approves AT&T-Time Warner Merger
A three-judge panel on a federal appeals court has ruled in approval of AT&T’s (NYSE: T) merger with Time Warner. The decision from the U.S. Court of Appeals for the DC Circuit ends a long legal battle between AT&T and the U.S. Department of Justice over the merger. An agency spokesperson released a statement saying that the Justice Department will not pursue further litigation in the case.
AT&T announced its intention to purchase Time Warner in October of 2016. The companies claimed that the merger would bring cost savings and new innovations to their customers. The Justice Department sued to stop the deal on antitrust grounds roughly a year after the merger was announced. The government claimed that the merger would reduce competition in the pay-TV industry and spur higher prices for consumers.
U.S. District Court Judge Richard Leon ruled in June that the merger could go forward with no conditions imposed, issuing a 172-page opinion on the matter. The Justice Department appealed the ruling on the grounds that Leon committed “fundamental errors of economic logic and reasoning” in his decision. The three judges rejected the appeal in a unanimous decision.
In the decision, the judges wrote that the government failed to take into account an arbitration agreement that the company had offered carriers in the event of a pricing or contract dispute. AT&T General Counsel David McAtee said in a statement, “The merger of these innovative companies has already yielded significant consumer benefits, and it will continue to do so for years to come. While we respect the important role that the U.S. Department of Justice plays in the merger review process, we trust that today’s unanimous decision from the D.C. Circuit will end this litigation.”