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Time Warner: Political ‘Motivation’ Was Behind Antitrust Lawsuit

WASHINGTON — A spokesman for Time Warner said that the definitive ruling in favor of its merger with AT&T was a confirmation that the case was politically motivated.

Gary Ginsberg, Time Warner’s executive vice president, said in a statement that U.S. District Judge Richard Leon’s “resounding rejection of the government’s arguments is confirmation that this was a case that was baseless, political in its motivation and should never have been brought in the first place.”

Executives at both companies broach the idea that the merger was singled out for antitrust enforcement because of President Donald Trump’s animosity toward Time Warner unit CNN.

Before the trial started, AT&T CEO Randall Stephenson called Trump’s opposition to the merger and attacks on CNN the “elephant in the room” and that the lawsuit raised First Amendment issues. Trump opposed the transaction during the 2016 presidential campaign, and supported the DOJ’s lawsuit.

Makan Delrahim, the chief of the Antitrust Division, denied that the decision to file the lawsuit was influenced by the White House. Before the trial started, Leon declined AT&T’s motion to pursue a line of defense that would have allowed it to conduct discover on communications between the White House and the DOJ.

Those questions, though, are likely to linger. The group Protect Democracy has been seeking access to the records through the Freedom of Information Act, but 83 pages have been withheld from public disclosure on the grounds that they “reflect the deliberative process of the Antitrust staff,” according to a letter that the DOJ sent to the group.

Last year, Sen. Amy Klobuchar (D-Minn.), the top Democrat on a Senate antitrust subcommittee, wrote a letter to Attorney General Jeff Sessions raising concerns about political interference from the White House in the merger review. She since met with Delrahim, and on Tuesday urged the DOJ to appeal.

“Allowing this merger to proceed raises serious concerns for consumers and the future of American media, and also sends a troubling signal to others that it’s open season for vertical mergers that could allow a company to raise the cost of essential products and services that its rivals need to compete, leading to higher costs for consumers and less innovation,” she said in a statement.

An array of public interest and labor groups — many of them far from supporters of Trump — nevertheless supported the Justice Department’s attempt to block the deal.

The Writers Guild of America West called Leon’s decision a “blow to consumers, content creators and competition.”

“The WGAW knows too well the harms of vertical mergers and welcomed the DOJ’s efforts to block this one,” the group said. “Unfortunately, a combined AT&T-Time Warner, like so many mergers before it, will lead to higher prices and fewer choices. Further, it will pave the way for more anti-competitive mega-mergers, like the forthcoming Comcast-NBCU-Fox tie-up.”

 

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