Four additional states have joined the ten attorney general which are suing in federal court to block the proposed merger of Sprint and T-Mobile US. A court date has been set for the trial — and that start date is October 7, delaying the merger that the two companies had hoped to accomplish by July.
Reuters reported that the chief of the antitrust bureau in the New York attorney general’s office said during a Friday hearing on the case that Hawaii, Massachusetts, Minnesota and Nevada will be listed on an amended complaint that would be filed with the court. That amended complaint was not yet available on Monday morning.
Those four states have joined the state AGs, led by New York and California and including the District of Columbia, which filed a suit in Southern District of New York earlier this month seeking to head off the merger before the Department of Justice and the Federal Communications Commission give their final decisions on whether to allow it.
The state attorneys general of Colorado, California, New York, Wisconsin, Maryland, Mississippi, Michigan, Connecticut, Virginia and the District of Columbia originally filed the suit. In their filing, they argued that the merger will harm competition and that “preserving vigorous competition for mobile wireless telecommunications services is essential to ensure continued innovation and low prices for American consumers.
The October start date was a compromise. The states wanted the trial to start in December, and the companies asked for it to begin in early September. The state AGs warned in a letter to the court that if the terms of the merger change significantly — such as in the concessions that the two companies are willing to make, or a settlement with the DoJ — they may ask for more time.
Meanwhile, T-Mobile US lawyer George Cary argued in a letter to the court that a streamlined timeline was justified, given that the companies have already provided a massive amount of information to the government as the states and the Department of Justice’s Antitrust Division have investigated the transaction over the past 14 months: more than 4.3 million documents, totally 29.7 million pages; plus “hundreds of pages” of narrative responses to questions, “large volumes of data” and more than 180 hours of depositions of company employees. Given the amount of data available, Cary wrote, “it is difficult to imagine” that additional time is needed for the discovery period of the case.
Although the Department of Justice and the Federal Communications Commission have not yet officially weighed in on the merger, the outlook appeared positive for the New T-Mobile (as the would-be merged company is called) in recent weeks. FCC Chairman Ajit Pai indicated that the merger has his support after public commitments from T-Mobile US and Sprint on items such as its timeline for nationwide 5G deployment, service to rural areas and divesting prepaid brand Boost Mobile. FCC Commissioner Brendan Carr also said publicly that he will support the merger.
The state AG lawsuit adds another hurdle and puts a question mark on the timeline of the merger.
Sprint and T-Mobile US’ stocks traded down Friday on the news of the additional states joining the lawsuit.
