The federal government on Tuesday lost its second court challenge to AT&T’s $85.4 billion merger with Time Warner, a blockbuster deal that has already begun to reshape much of the media industry.
A three-judge panel of the United States Court of Appeals for the District of Columbia rejected the government’s claim that a lower court had applied antitrust laws incorrectly in allowing the merger to proceed. Justice Department lawyers have argued that the combination of the two companies would reduce competition and hurt consumers.
“The government’s objections that the district court misunderstood and misapplied economic principles and clearly erred in rejecting the quantitative model are unpersuasive,” Judge Judith W. Rogers wrote on behalf of the panel.
The decision cements one of the biggest losses for the Justice Department’s antitrust division in a generation. The DOJ lawsuit, filed in November 2017, was the first major antitrust action under the Trump administration, and the case marked the first time in 40 years the government fully litigated a case challenging a “vertical” merger that combined two companies that didn’t compete head-to-head.
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