• by Mark Walsh  @markfwal, November 18, 2009

Handing AT&T a setback in its legal battle to stop Verizon Wireless from running ads it says are misleading, a judge Wednesday denied the carrier's request to order Verizon to halt the campaign immediately.

A federal judge in Atlanta declined to grant AT&T's motion for a temporary restraining order to stop Verizon from showing the ads in which it compares AT&T's 3G coverage unfavorably to its own.

AT&T alleged in a lawsuit filed earlier this month that the ads are blatantly false and have caused irreperable harm to its business. The ads use side-by-side U.S. maps to show that Verizon has five times more 3G coverage than AT&T.

While AT&T doesn't argue that the colored coverage maps are inaccurate in depicting its 3G coverage, it contends Verizon is misleading consumers by implying that they can't get any coverage in the areas of the AT&T map left blank. Customers can, in fact, still make calls using its slower EDGE or GRPS networks.

AT&T last week filed an amended complaint to include Verizon's new trio of holiday-themed ads mocking its network in its lawsuit initially brought over the company's "There's a Map for That" commercial.

Verizon fired back in a 53-page rebuttal to the court this week that AT&T is suing not over the substance of its ad claims, but because it can't stand the truth about its own network. "AT&T sued because Verizon's ads are true and the truth hurts," stated Verizon's court papers.

AT&T nevertheless said it plans to go forward with its case. "While we are disappointed with the court's decision on our request for a TRO, we still feel strongly that Verizon's ads mislead consumers into thinking that AT&T doesn't offer wireless service in large portions of the country, which is clearly not the case," the company said in a statement. "We look forward to presenting our case to the court in the near future."

A hearing on its motion for a preliminary injunction is scheduled for Dec. 16.