Splitting the difference between AT&T’s request for a trial date in February and the government’s interest in beginning as late as May, the judge in the closely watched antitrust battle said the trial will begin March 19.
During a pre-trial hearing, U.S. District Court Judge Richard Leon in Washington established middle ground between AT&T’s request for Feb. 20 and the government’s preference of May 7.
At issue is AT&T’s proposed $85 billion takeover of Time Warner, a vertical deal that had sailed through many agencies’ review process and was thought to be days away from a DOJ stamp of approval before antitrust division chief Makan Delrahim hit the brakes. In the lawsuit filed last month by the Department of Justice said the deal would raise prices for rival distributors and also pay-TV subscribers, while hampering the growth of online video.
President Donald Trump has also weighed in against the combination. “I always felt that was a deal that was not good for the country,” he said in November. Execs at AT&T have publicly questioned the timeline of DOJ’s sudden interference, which also came after talks with regulators, who said AT&T could have an easier time if it shed CNN or other large assets as a condition of their approval. The flagging of CNN, as opposed to Turner or any other part of the combined empire, has been widely interpreted as political retribution, given Trump’s longstanding animus toward the news network.
Publicly, the Trump Administration has shrugged off those theories, and Delrahim has explained that his issue lies in the “behavioral remedies” that an OK for the mega-deal would require, as opposed to the “structural remedies” of requiring AT&T to cut loose some key parts and slim down the profile.
The mid-March date for a trial expected to last a couple of weeks means the media industry won’t have a sense of which way the regulatory winds are blowing until the second quarter of 2018. Fox and Disney appear ready to come together in a game-changing merger, plus deals between Discovery and Scripps for cable programming and Sinclair Broadcast and Tribune Media for local TV stations are already making the final rounds in Washington.
One high-profile test of the Administration’s somewhat inscrutable stance on antitrust regulation could come with a non-entertainment deal: Aetna’s pending merger with CVS, which appears to raise some similar behavioral remedy concerns. The difference, of course, is that neither the health insurance company nor the pharmacy chain has been accused of peddling fake news.