Bloomberg News

AT&T, Sprint Propose Antitrust Trial After Government’s Case

December 09, 2011

(Updates with details from filings in third paragraph.)

Dec. 6 (Bloomberg) -- AT&T Inc. and Sprint Nextel Corp. agreed their dispute over AT&T’s planned purchase of T-Mobile USA Inc. should be tried after the government’s case opposing the deal while they clashed on the proposed schedule.

AT&T and Sprint, in separate filings today in U.S. District Court in Washington, said their aim is to avoid interfering with trial of the U.S. Justice Department’s lawsuit scheduled for Feb. 13.

Sprint and Cellular South Inc., which also sued to block the $39 billion T-Mobile acquisition, proposed that Judge Ellen Segal Huvelle set a trial date “immediately” after all the evidence is presented in the U.S. case “so that they can be heard prior to the closing of the transaction.”

AT&T argued that no trial date should be set until Huvelle hands down a verdict in the Justice Department case. The lawsuits involve different claims and will require different evidence, the company said.

“The schedule for this litigation need not depend on the timing for the closing of this transaction,” AT&T’s lawyer, James Wade of Haynes & Boone LLP in Washington, wrote. Wade argued that Huvelle has authority to order the merged company to change its behavior after the deal has closed if she finds antitrust violations.

A hearing in all three antitrust cases is scheduled for Dec. 9.

Reduce Competition

The Justice Department sued Dallas-based AT&T and T-Mobile Aug. 31, saying a combination of the two companies would “substantially” reduce competition. Seven states and Puerto Rico joined the effort to block the deal, which would make AT&T the biggest U.S. wireless carrier.

Sprint, the third-biggest U.S. wireless carrier, filed its antitrust lawsuit on Sept. 6, saying the proposed merger would weaken its ability to compete with AT&T, the second-biggest, and Verizon Communications Inc., the market leader.

Cellular South, based in Ridgeland, Mississippi, sued on Sept. 19, claiming the merger threatened to “substantially” cut competition.

Huvelle last month dismissed several claims in the Sprint and Cellular South lawsuits. She limited the cases to Sprint’s allegations regarding access to mobile devices and Cellular South’s complaints involving roaming fees as well as devices.

The government’s case is U.S. v. AT&T Inc., 1:11-cv-01560; Sprint’s case is Sprint Nextel Corp. v. AT&T Inc., 11-cv-01600; and Cellular South’s case is Cellular South Inc. v. AT&T Inc., 1:11-cv-01690, U.S. District Court, District of Columbia (Washington).

--Editors: Fred Strasser, Andrew Dunn

To contact the reporters on this story: Tom Schoenberg in Washington at tschoenberg@bloomberg.net: Sara Forden in Washington at sforden@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.


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