Top Antitrust Official Vigorously Defends Decision To Sue AT&T: “The Irony In That Case Is Rich”

Speaking on the same day a federal judge is set to deliver a high-stakes ruling in the government’s lawsuit aiming to block AT&T’s merger with Time Warner, top U.S. antitrust regulator Makan Delrahim vigorously defended the legal attack.

“The irony in that case is rich,” Delrahim said of the months-long battle over the $85 billion deal, during which his role and the White House’s perspective came under scrutiny. His remarks came at the start of a day-long forum hosted by the non-partisan Open Markets Institute. “The career staff put together a straightforward consumer welfare analysis that showed that merger would unlawfully raise prices for cable TV subscribers and harm online innovation. … The harms of that transaction, following a consumer welfare rubric, were simply too great to accept, or try to fix with ineffective behavioral remedies.”

Delrahim’s use of the adjective “career” to describe his long-tenured team was no accident. Critics of the decision to sue AT&T have pointed to the abrupt timing of the suit, which came just a couple of months after Delrahim was appointed by President Donald Trump, a staunch foe of CNN and a vocal critic of the deal. During his academic career, Delrahim had made comments advocating approval of the merger, leading to even more head-scratching. As the trial proceeded, though, defense lawyers were barred from exploring the possibility of a Trump/anti-CNN motive.

In his speech, Delrahim sought to characterize the case as a straightforward effort with roots in the Supreme Court’s 1963 Philadelphia National Bank decision. The court ruled in that case that regulators do not need to some “ultimate reckoning of social or economic debits and credits,” but instead focusing on protecting the competitive economy. By giving us focus, the consumer welfare standard reduces the risk of what Brandeis called “dangers to liberty” from well-meaning enforcers,” he said.

Delrahim also offered an example of the need to stay focused, citing a “curious request” from a state antitrust official fielded by the DOJ as it prepared its lawsuit.

“They told us they would only join our case if we provided written assurances that no divestiture would go to Fox or to Rupert Murdoch,” Delrahim said. “They actually wanted to direct the divestiture based on the viewpoint of the buyer, not on what benefits competition or consumers, as defined by the consumer welfare standard. We, of course, rejected the request, because it would have been unconstitutional to accede to it.”

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