AT&T Faces Potential Delay in DOJ Trial

AT&T’s acquisition of T-Mobile USA faces another problem that could contribute to unraveling the $39 billion deal.

The Department of Justice plans to ask a federal judge to postpone court proceedings in an antitrust lawsuit over whether the merger is anticompetitive, potentially further delaying resolution on the fate of the controversial merger between the nation’s second- and fourth-largest wireless providers.

Joseph Wayland, an attorney with the Justice Department, on Friday told U.S. District Court Judge Ellen S. Huvelle that expedited court proceedings in the case weren’t necessary any longer because the companies have withdrawn their application for merger approval at the Federal Communications Commission, Dow Jones Newswires reported. The Justice Department, the report said, plans to either ask the court to stay the proceedings, or alternatively, withdraw the case until the companies ask the FCC for approval once more.

AT&T and T-Mobile’s parent, Deutsche Telekom, last month withdrew their applications for FCC approval of the merger after AT&T learned that the agency would seek an administrative hearing on the deal. FCC staff blasted the merits of the deal in a report that AT&T sought to keep private.

The Justice Department lawsuit is scheduled to go to trial in February, but a ruling by Huvelle to delay the proceedings could hurt AT&T in its bid to win approval for the merger, an analyst said.  

“If the trial is put off, it would be a serious blow to AT&T/T-Mobile’s chances for turning things around in the face of opposition from the DOJ and resistance from the FCC, which in turn could put more pressure on T-Mobile to seek to walk away from the deal,” Stifel Nicolaus analyst Christopher King wrote today in a report.

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