Sprint, C Spire Say They Should Be Allowed to Join Case Against AT&T/T-Mobile Deal
Sprint Nextel and C Spire asked the U.S. District Court in Washington to deny an AT&T motion to exclude them from the lawsuit the government filed against the AT&T/T-Mobile deal. Each previously filed an antitrust complaint against the merger. Judge Ellen Huvelle has indicated she will rule promptly on whether she will allow the two competitors to join the Department of Justice’s case following oral arguments later this month.
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"Today, relying on three decades of jurisprudence that establishes a competitor’s standing to sue under Section 7 of the Clayton Act, C Spire and Sprint asked the court to deny AT&T’s motion,” said Eric Graham, vice president of C Spire, formerly called Cellular South. “Because AT&T’s proposed takeover of T-Mobile will undeniably impair competition by limiting Sprint’s and C Spire’s ability to provide consumers the roaming access and devices they demand, AT&T’s motion should be denied.”
Susan Haller, Sprint vice president for litigation, said the Supreme Court established a principle in antitrust law which AT&T, Deutsche Telekom and T-Mobile refuse to acknowledge. “Their competitors have the right to bring an antitrust complaint to stop AT&T’s proposed takeover of T-Mobile if they allege that the proposed transaction is likely to harm their ability to compete,” Haller said. “Last month, Sprint and C Spire Wireless, in a manner fully consistent with this long-held principle of antitrust law, did exactly that and explained how the proposed takeover of T-Mobile would harm consumers and hurt competition across the wireless industry."
"Defendants do not even challenge the complaints’ allegations setting forth a structural violation of Section 7 of the Clayton Act, which, exactly like the DOJ’s complaint, raises a presumption that the merger unlawfully creates market power,” the companies said in a joint filing. “In turn, to have standing, Sprint and Cellular South need only allege that this resulting market power will likely impair their ability to compete in the future, thereby further enhancing AT&T’s ability to raise prices or reduce competition.” The deal would transform the wireless market, from one with four national carriers to an “AT&T and Verizon duopoly, where Sprint is marginalized and no longer able to constrain price,” the filing said. AT&T would have “greater ability and incentive to coerce handset manufacturers and others into not dealing with Plaintiffs,” Sprint would lose T-Mobile as an “important historical collaborative partner” and “AT&T would have greater ability and incentive to foreclose Plaintiffs’ access to necessary inputs like backhaul and roaming,” the filing asserts.
AT&T General Counsel Wayne Watts fired back. “The virtue of an open court process is that Sprint’s motives are now clear to everyone,” Watts said. “Despite their disingenuous rhetoric, Sprint is obviously afraid of competition. Their court complaint, and today’s response, demonstrate for all to see that they are not trying to protect consumers -- who would clearly benefit from our merger with T-Mobile. Instead, they are trying to protect themselves. Antitrust law is not about protecting a particular competitor, but rather is about protecting competition, and that is why we are confident that Sprint’s complaint will ultimately fail."