Court Delays Start of T-Mobile-Sprint Suit to December

Texas joins suit, saying DOJ deal isn't good for its citizens
Author:
Publish date:

A New York Southern District Court has delayed the start of the trial in the attorneys general lawsuit challenging the T-Mobile-Sprint deal to Dec. 9 (from Oct. 7), essentially guaranteeing the deal will not close until 2020 unless the suit is settled before that. 

That is according to a source familiar with the initial status hearing in the New York court Thursday (Aug. 1).

Tmob- sprint

T-Mobile and Sprint have told the court they will not try to close the deal until six days after a court decision. The FCC has yet to weigh in officially on the merger, though the three-Republican majority have said with the boost spin-off and 5G buildouts and other conditions, they plan to approve it.

Related: T-Mobile-Sprint Critics Pan Dish as Fourth Wireless Competitor

The Justice Department and a handful of state AGs last week settled with the companies, but the remaining AGs are pushing forward with their suit, alleging the DOJ conditions on the deal, 5G buildouts, a spin-off of Boost Mobile to Dish to seed a fourth facilities based mobile wireless company, don't cut it.

The court granted more time for further discovery in the case, but other issues remain that the magistrate judge asked the two sides to hammer out independently if possible. 

In other news, Texas is joining the challenge as a co-plaintiff, which bumps up the total to 15 states and 15 AGs.

“While we appreciate the time and effort that went into the agreement between the parties and the U.S. Dept. of Justice, the Texas Attorney General has an independent obligation to protect Texas consumers," said Texas AG Ken Paxton. "After careful evaluation of the proposed merger and the settlement, we do not anticipate that the proposed new entrant will replace the competitive role of Sprint anytime soon....The bargain struck by the U.S. Dept. of Justice is not in the best interest of working Texans, who need affordable mobile wireless telecommunication services that are fit to match the speed and technological innovation demands of Texas’ growing economy.”

“This is welcome news having Texas as a partner in our fight to protect consumers and competition," said Xavier Becerra, attorney general of California, the lead plaintiff along with New York. "Our coalition of 15 attorneys general will do everything it can to ensure telecom prices are fair and competitive. In California, our concerns with the merger have been about the harms posed by shrinking market competition. Choice is not real if competition isn’t meaningful, and a marketplace with fewer active competitors drives up prices and thwarts innovation.” 

“The news that Texas has joined the states’ lawsuit underscores that the T-Mobile/Sprint merger is and remains anti-competitive and harmful to consumers and workers," said Debbie Goldman, policy director for the Communications Workers of America. "Nothing in the announced divestiture deal remedies these concerns, as Texas AG Paxton clearly recognizes. In fact, as we noted last week, through the announced divestiture deal with DISH, T-Mobile is creating its largest customer, not a new competitor.

CWA is worried that no matter how the new, combined, company is configured, it will spell tens of thousands of job losses, a charge T-Mobile disputes.  

Related