Seven states move to block AT&T's merger with T-Mobile

John O'Brien Sep. 16, 2011, 4:59pm


WASHINGTON (Legal Newsline) - Seven states have joined the federal Department of Justice's effort to block AT&T's purchase of T-Mobile.

The DOJ filed an antitrust lawsuit on Aug. 31 that seeks to block the proposed $39 billion transaction. Illinois is one of the states that decided to join the feds.

State Attorney General Lisa Madigan said the purchase "would substantially lessen competition for mobile wireless telecommunication services... across the United States. Blocking this acquisition protects consumers and businesses against fewer choices, higher prices, less innovation and lower quality service.

Four providers - AT&T, T-Mobile, Sprint and Verizon - account for more than 90 percent of mobile wireless connections, Madigan said. The other states that joined the lawsuit are California, Massachusetts, New York, Ohio, Pennsylvania and Washington.

One attorney general who decided not to join the lawsuit is Connecticut's George Jepsen, though he said the transaction raises "serious antitrust issues."

"Given the significant resources that the federal government has dedicated to the case, my decision not to join this antitrust lawsuit was based on an election to focus the limited resources of my office and Connecticut's antitrust enforcement efforts on other matters," he said in a statement.

In an answer to the DOJ's complaint, AT&T said T-Mobile is losing customers and subscriber shares.

"Without this merger, AT&T will continue to experience capacity constraints, millions of customers will be deprived of faster and higher quality services, and innovation and infrastructure will be stunted," the answer says.

"If this transaction does not close due to Plaintiff's lawsuit, wireless consumers will, as the FCC chairman predicts, increasingly face higher prices and lower quality."

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