Uncle Sam Should Put Consumers First in Its AT&T Appeal

Posted by Bloomberg

Uncle Sam Should Put Consumers First in Its AT&T Appeal

By Tara Lachapelle

Antitrust officials from the US Justice Department say the judge that ruled in favor of AT&T Inc.’s takeover of Time Warner ignored economic theory and common sense. But what the judge needed from them was something more concrete.

On Monday, the government’s attorneys filed their opening brief to appeal US District Judge Richard Leon’s June decision, a last-ditch attempt to stop—or, rather, now undo—the US$102 billion transaction that has transformed AT&T into a powerful media conglomerate and inspired other corporate giants to test the bounds of antitrust law. 1 While the odds of overturning the ruling are widely considered slim, it’s interesting, if not disappointing, to see where Assistant Attorney General Makan Delrahim is taking the case.

Rather than present stronger evidence, his team is arguing that the court erroneously disregarded the economics around bargaining power and failed to fully grasp an expert witness’s analytical model that was core to the case, thus arriving at the decision based on “faulty logic.” I’m no lawyer, but I’m not sure this is the most promising tack.

The common thread in the judge’s opinion seemed to be that the government wasn’t specific enough in tracing the harm the deal would cause consumers and instead relied too much on speculation from AT&T’s competitors. Recall the cross-examination of the governmen