Nine States Support AT&T In Fight Over Time Warner Merger

Siding with AT&T, attorneys general in nine states are asking an appellate court to reject the Justice Department's attempt to unwind the company's recent $85 billion acquisition of Time Warner.

In court papers filed Wednesday, the attorneys general argue that U.S. District Court Judge Richard Leon correctly found that the merger will "produce many millions of dollars’ worth of benefits for consumers," and will position AT&T to better compete with online video distributors like Netflix and Amazon.

"Competition leads to lower prices, higher quality products, and innovative goods and services for consumers," the attorneys general of Wisconsin, Alabama, Georgia, Louisiana, New Mexico, Oklahoma, South Carolina, Utah and Kentucky write in a friend-of-the-court brief filed Wednesday with the D.C. Circuit Court of Appeals.

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The officials are weighing in on the government's appeal of Leon's recent decision to allow AT&T to acquire Time Warner. The DOJ unsuccessfully argued to Leon that the merger -- which brings cable companies including CNN and HBO into AT&T's fold -- was anti-competitive and would lead to decreased competition and higher prices for consumers.

The DOJ is now asking the D.C. Circuit to reverse Leon's decision, arguing that the judge ignored "fundamental principles of economics and common sense."

AT&T recently countered in court papers that Leon "meticulously evaluated the evidence and rejected the factual underpinnings of DOJ’s case."

The nine attorneys general are asking the appellate court to note that the DOJ's initial lawsuit wasn't joined by any states.

"It is rare for the federal government to pursue an antitrust case involving major, national companies without any state joining the effort," they write. "History suggests that at least some states would not hesitate to get involved if they believed that the merger would decrease competition and harm their citizens."

The merger closed in late June, but AT&T is managing the Turner network separately from DirecTV and U-Verse. The company plans to maintain that structure until the earlier of February 28, 2019, or the conclusion of the government's appeal.

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