Responding to the U.S. Justice Department's blockbuster antitrust enforcement action, lawyers for AT&T and T-Mobile USA said today in a court filing the proposed merger is a win for consumers.
The attorneys for the two mobile companies said in their joint response (.pdf) to the government’s complaint that the deal would create “substantial new capacity to meet the spectacular growth in demand resulting from an increasingly on-line world.”
Mark Hansen, a name partner in Washington’s Kellogg, Huber, Hansen, Todd, Evans & Figel, filed the court papers this afternoon in U.S. District Court for the District of Columbia. Hansen and Kellogg Huber's Michael Kellogg filed appearances this afternoon for AT&T.
Crowell & Moring and Arnold & Porter also represent AT&T in the case. Teams from O’Melveny & Myers and Cleary Gottlieb Steen & Hamilton represent T-Mobile.
“Rather than substantially reducing competition, the combined firm will usher in more intense competition to an already vibrantly competitive market,” the attorneys said. The lawyers said DOJ’s complaint “fails to come to grips with the significant efficiencies this transaction will generate.
In the response, the attorneys for AT&T and T-Mobile said the Justice Department “largely ignores the significant competition” from Verizon Wireless and Sprint.
Sprint has filed a separate suit in Washington federal district court challenging the proposed $39 billion merger.
“Wireless competition is fierce: prices have declined steadily, output is expanding, technological innovation is occurring at an extraordinary pace, and new providers with innovative business models have successfully entered and expanded,” the attorneys for AT&T and T-Mobile said. “All of this will continue, and likely increase, after the transaction.”
DOJ said in its complaint (.pdf), filed Aug. 31, that the proposed deal would eliminate T-Mobile “as an independent, low-priced” cell provider and would remove a “significant competitive force from the market.”
The Justice Department’s legal team, including the Antitrust Division’s Claude Scott Jr. and Acting Assistant Attorney General Sharis Pozen, said T-Mobile’s investment in an advanced high-speed network and other innovations have provided substantial value to consumers.
“Thus, unless this acquisition is enjoined, customers of mobile wireless telecommunications services likely will face higher prices, less product variety and innovation, and poorer quality services due to reduced incentives to invest than would exist absent the merger,” Justice attorneys said in the complaint.
U.S. District Judge Ellen Segal Huvelle has set a status hearing for Sept. 21.