A U.S. appeals court on Tuesday upheld a lower court’s approval last year of AT&T’s $85.4 billion deal to acquire Time Warner, rejecting the Justice Department’s assertion that the deal would violate antitrust guidelines.
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A three-judge panel voted unanimously to uphold the decision, marking the Justice Department’s second loss on the subject since last June. It was the federal government’s first antitrust challenge since President Trump assumed office.
"The government's objections that the district court misunderstood and misapplied economic principles and clearly erred in rejecting the quantitative model are unpersuasive," the judges said in their opinion.
U.S. District Judge Richard Leon ruled last summer that federal officials had failed to prove that the deal would hurt competition among telecom companies. The transaction was allowed to proceed without any conditions, pending the result of the Justice Department’s appeal.
Federal antitrust officials argued that a merger would give AT&T an unfair advantage over rival cable companies and increase prices for consumers. In its appeal, the Justice Department argued that the lower court had failed to consider key evidence regarding the deal, asserting in an appellate brief last August that the original ruling ignored “fundamental principles of economics and common sense.”
AT&T acquired DirecTV, HBO, CNN and the Warner Bros. film studio as part of the deal. The company has already begun integrating the new assets.
AT&T CEO Randall Stephenson told FOX Business the company’s acquisition of Time Warner, now known as WarnerMedia, would provide “a new opportunity to give consumers on-demand content,” noting that its new platform would include HBO and Turner content.