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posted: 6/13/2018 7:00 AM

AT&T antitrust win may herald a new wave of media mergers

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  • FILE- In this March 22, 2018, file photo, AT&T CEO Randall Stephenson leaves the federal courthouse in Washington. The judge presiding over the government's legal effort to block AT&T's purchase of Time Warner will likely deliver his verdict on Tuesday, June 12.

    FILE- In this March 22, 2018, file photo, AT&T CEO Randall Stephenson leaves the federal courthouse in Washington. The judge presiding over the government's legal effort to block AT&T's purchase of Time Warner will likely deliver his verdict on Tuesday, June 12.
    Associated Press

  • FILE - In this Monday, Oct. 24, 2016, file photo, the AT&T logo is positioned above one of its retail stores, in New York.  The fate of the AT&T-Time Warner merger, a massive media deal opposed by the government that could shape how much consumers pay for streaming TV and movies, rests in the hands of a federal judge.  U.S. District Judge Richard Leon is expected to announce in court Tuesday, June 12, 2018  his decision in the biggest antitrust trial in years.

    FILE - In this Monday, Oct. 24, 2016, file photo, the AT&T logo is positioned above one of its retail stores, in New York. The fate of the AT&T-Time Warner merger, a massive media deal opposed by the government that could shape how much consumers pay for streaming TV and movies, rests in the hands of a federal judge. U.S. District Judge Richard Leon is expected to announce in court Tuesday, June 12, 2018 his decision in the biggest antitrust trial in years.
    Associated Press

  • FILE - In this Oct. 24, 2016, file photo, clouds are reflected in the glass facade of the Time Warner building in New York. The judge presiding over the government's legal effort to block AT&T's purchase of Time Warner will likely deliver his verdict on Tuesday, June 12, 2018.

    FILE - In this Oct. 24, 2016, file photo, clouds are reflected in the glass facade of the Time Warner building in New York. The judge presiding over the government's legal effort to block AT&T's purchase of Time Warner will likely deliver his verdict on Tuesday, June 12, 2018.
    Associated Press

 
 

WASHINGTON -- Leon said the government failed to prove that the merger would lead to higher prices and other harm to consumers. Despite Justice Department lawyers taking their "best shot," he said, their evidence was "too thin a reed for this court to rely on."

The judge added that he wouldn't temporarily block the merger for a possible appeal by the government. The "drop dead" deadline for completing the merger is June 21. If it's not wrapped up by then, either company could walk away, and AT&T would have to pay a $500 million breakup fee.

The ruling was a stinging defeat for the Justice Department. Opposing the merger forced federal antitrust lawyers to argue against standing legal doctrine that favors mergers among companies that don't compete directly with each other.

Another wild card: When first announced in October 2016 , the deal drew fire from then-candidate Donald Trump, who promised to kill it "because it's too much concentration of power in the hands of too few." Trump has also publicly feuded with Time Warner's CNN, calling it "failing" and a purveyor of "fake news." The president's statements didn't come up during the trial.

John Bergmayer, senior counsel at the consumer group Public Knowledge, said the decision could have long-lasting negative effects thanks to "the many other mergers it will encourage." In a statement, Bergmayer called for "reinvigorated regulatory oversight of the video marketplace."

Dallas-based AT&T is a wireless, broadband and satellite behemoth that became the country's biggest pay-TV provider with its 2014 purchase of DirecTV. It claims about 25 million of the 90 million or so U.S. households that are pay-TV customers.

AT&T general counsel David McAtee said the company plans to close the deal on or before June 20.

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