When it Rains it Pours: Sprint Files Suit to Block AT&T and T-Mobile Merger

In terms of the pending AT&T and T-Mobile merger, the United States Department of Justice isn’t the only one with a bone to pick these day. Sprint has just officially jumped aboard the big litigation train and filed their own lawsuit against the controversial merger. The Now Network’s lawsuit was filed today in the District of Columbia against AT&T, Deutsche Telekom (T-Mobile’s German parent company), and T-Mobile.

Sprint has not been shy when it comes to voicing their discontent with the pending merger. Their filing outlines their overall concern that the merger will severely hurt consumers, corporate customers and of course, carriers like themselves.

So what is AT&T going to do now? That’s a good question. Recent speculation had centered around AT&T planning to present the Department of Justice with a proposed settlement in an attempt to avoid having to go to court at all. If they do go that route they’ll also have to prepare a battle plan to fight off Sprint’s lawsuit as well. That is if they can make it through the Department of Justice first.  

Read on for the full and legally stimulating press release below.

Sprint Files Suit to Block Proposed AT&T and T-Mobile Transaction

WASHINGTON–(EON: Enhanced Online News)–Sprint Nextel [NYSE:S] today brought suit against AT&T, Inc., AT&T Mobility, Deutsche Telekom and T-Mobile seeking to block the proposed acquisition as a violation of Section 7 of the Clayton Act. The lawsuit was filed in federal court in the District of Columbia as a related case to the Department of Justice’s (DOJ) suit against the proposed acquisition.

“Sprint opposes AT&T’s proposed takeover of T-Mobile,” said Susan Z. Haller, vice president-Litigation, Sprint. “With today’s legal action, we are continuing that advocacy on behalf of consumers and competition, and expect to contribute our expertise and resources in proving that the proposed transaction is illegal.”

Sprint’s lawsuit focuses on the competitive and consumer harms which would result from a takeover of T-Mobile by AT&T. The proposed takeover would:

Harm retail consumers and corporate customers by causing higher prices and less innovation.

Entrench the duopoly control of AT&T and Verizon, the two “Ma Bell” descendants, of the almost one-quarter of a trillion dollar wireless market. As a result of the transaction, AT&T and Verizon would control more than three-quarters of that market and 90 percent of the profits.

Harm Sprint and the other independent wireless carriers. If the transaction were to be allowed, a combined AT&T and T-Mobile would have the ability to use its control over backhaul, roaming and spectrum, and its increased market position to exclude competitors, raise their costs, restrict their access to handsets, damage their businesses and ultimately to lessen competition.