Trump administration appeals court loss in AT&T/Time Warner case
The US Department of Justice will appeal the court ruling that allowed AT&T to purchase Time Warner Inc.
AT&T completed the merger after getting a favorable ruling from a judge at the US District Court for the District of Columbia last month. The Trump administration's Justice Department did not seek a stay of the ruling, so AT&T was able to take ownership of Time Warner. But the DOJ is appealing the judge's ruling to the United States Court of Appeals for the District of Columbia Circuit, the DOJ said in a court filing today.
A court could theoretically force AT&T and Time Warner to reverse the merger. AT&T said it would maintain some separation between its old and new business units in a post-verdict letter to the DOJ. That separation might make undoing the merger logistically easier if the DOJ wins its appeal.
The former Time Warner properties—HBO, Turner Broadcasting System, and Warner Bros.—are part of a new AT&T business unit called WarnerMedia.
"AT&T Communications will have no role in setting Turner's prices or other terms to unaffiliated distributors, and Turner will not consult with AT&T Communications in setting Turner prices or other terms for programming provided to unaffiliated video distributors," AT&T said upon closing the merger.
AT&T also said that it "will implement a firewall between Turner and AT&T Communications to prevent the transmission or exchange, either directly or indirectly, of competitively sensitive information of unaffiliated programmers or distributors."
The Department of Justice argued that the merger would raise prices on consumers—and AT&T increased prices of its DirecTV Now streaming service shortly after closing the deal. But the government failed to prove that the merger would substantially lessen competition or that AT&T would use its ownership of premium content to harm rival TV providers, US District Judge Richard Leon wrote in his decision last month.