AT&T is facing renewed concerns over its proposed purchase of Time Warner as the Senate prepares to evaluate Makan Delrahim, the man President Trump nominated to head the antitrust division of the Justice Department, which is the government agency that will decide whether AT&T’s purchase of Time Warner will run afoul of anti-competition rules.
The Senate Judiciary Committee will hold a hearing on Delrahim’s confirmation Wednesday, and AT&T’s proposed $84.5 billion purchase of media giant Time Warner will likely be a major topic of discussion. Delrahim is up for the position of Assistant Attorney General of the Department of Justice’s Antitrust Division.
For his part, Delrahim said prior to receiving Trump’s nomination that he doesn’t believe AT&T’s proposed purchase of Time Warner presents a “major antitrust problem.” As Recode pointed out, Delrahim is a Washington, D.C.,-based antitrust lawyer who has represented companies ranging from AT&T to Comcast to Qualcomm.
And it’s Delrahim’s previous experience that could create challenges for AT&T in its pursuit of Time Warner. Already, Sen. Amy Klobuchar—the Senate Judiciary Committee’s top Democrat—told Recode that she will ask whether Delrahim will recuse himself from any proceeding that involves a prior client “as required by law.”
Republicans on the committee though hailed Delrahim’s experience, including his work for big-name companies. Mike Lee, chairman of the Senate Judiciary Committee, told Recode that “it’s not surprising that the president nominated an antitrust attorney to be assistant attorney general for antitrust. And it’s not surprising that an antitrust attorney would have represented clients in antitrust matters.”
The White House said that Delrahim would “recuse himself in accordance with the law from matters where certain former clients are parties and any mergers he was involved with in the private sector,” Recode noted, but didn’t name AT&T specifically.
Delrahim worked on behalf of AT&T in 2007, but then worked against the company in 2011 on behalf of Dish Network in order to prevent AT&T’s proposed acquisition of T-Mobile. Just last year, Delrahim represented Qualcomm on antitrust issues.
But Delrahim’s ties to AT&T aren’t the only issues that could trip up the telecom giant’s efforts to acquire Time Warner. A new report by The New York Times pointed out that AT&T’s argument in support of its acquisition of Time Warner appears to run counter to its actions geared toward preventing new broadband providers from entering cities in places like Missouri, Tennessee and North Carolina. Specifically, AT&T has positioned its acquisition of Time Warner as a way for the company to combat its cable rivals. But as the NYT pointed out, AT&T has used its own position as a leading telecommunications provider to argue in favor of local regulations that would allow new providers to enter local markets.
“Antitrust officials may have a hard time buying AT&T’s argument that it will expand broadband competition and not seek to harm competitors if they find the company is actively working to block new broadband players from entering the markets AT&T already dominates,” Gene Kimmelman, the president of Public Knowledge, a public-interest group, told the NYT.
Not surprisingly, AT&T argued that its actions in Missouri, Tennessee and elsewhere were intended to protect its network from interference rather than preventing competition.
AT&T announced its blockbuster acquisition of Time Warner late last year, and still expects to close the transaction sometime this year.
Article updated April 25 to correct Delrahim's proposed position at the Justice Department.