The prospect that "third parties [could] undercut...federal enforcement decisions" - such as the pending T-Mobile/Sprint merger - is one of the greatest concerns in the new antitrust environment, Assistant Attorney General Makan Delrahim explained in remarks to the monthly luncheon of the Media Institute in Washington on Wednesday (Feb. 5). He reminded the policy-centric audience that the Federal Communications Commission, the Department of Justice and many states approved the merger last year. But then attorneys general from 10 states and the District of Columbia sued to prevent the alliance; a decision is still pending.
"So, we have two specialized federal agencies reviewing the T-Mobile/Sprint transaction" and deeming it legal, Delrahim said. "Yet, we have a minority of states and the District of Columbia trying to undo that relief across the entire country. If you find this situation odd, you’re not alone."
"We often work closely with our state attorneys general partners in enforcement actions," he continued. "Here, however, a small group of state attorneys general did not reach consensus." Delrahim contended that such actions are "incompatible with the orderly operation of our antitrust merger laws and telecommunications regulations. It creates the risk that a small subset of states, or even perhaps just one, could undermine beneficial transactions and settlements nationwide."
Delrahim fretted, "That any state, or even any individual, can undo the nationwide relief secured by the federal government and approved by a federal court."
"That would wreak havoc on parties’ ability to merge, on the government’s ability to settle cases, and cause real uncertainty in the market for mergers and acquisitions," he added, noting that "Permitting states to undermine federal enforcement also would be contrary to congressional intent."
The AAG's passionate example emphasized the core of his remarks, which focused on DoJ's efforts to "reform" and "modernize" the Antitrust Division's merger review process.
"As a benchmark to measure success, we committed that we would aim to resolve most merger investigations within six months of filing," Delrahim said. After about 18 months of efforts, he said current initial merger reviews take about 5.4 months, and for cases that involve any challenge "the average time to notification is 5.7 months."
Steering Clear of Tech Examination and Media Issues
Delrahim ducked questions about DoJ's broad antitrust investigation of major digital platform firms (Google, Amazon, Apple and Facebook), announced in July. Initially, the agency expected to complete that probe by the end of 2019.
Early this week, Delrahim was recused from the Google portion that probe because of a potential conflict of interest. Before joining DoJ, Delrahim in private practice represented Google in its 2007 acquisition of DoubleClick, an ad-tech firm.
Separately, Delrahim touched briefly on the long-pending examination of the 1941 consent decrees affecting BMI and ASCAP music licensing agreements. Last year, he said that DoJ expected to decide by the end of 2019 whether those restrictions should be amended, eliminated or maintained as is.
On Wednesday he would only say that the agency's review is not comparable to its November 2019 termination of the half-century-old Paramount consent decree affecting studio ownership of exhibition facilities.