DOJ is on the ropes versus AT&T and Time Warner, experts say

Gavel court room lawsuit judge
The judge overseeing the cas doesn’t haven’t have to make a binary decision in regard to the outcome. (Pixabay)

Having rested its case to try to stop the $85.4 billion merger of AT&T and Time Warner Inc., the Justice Department is likely on the ropes and looking for a settlement, legal experts say.

Speaking to CNN, Jonathan Pitt, who co-chairs the antitrust practice group for Williams & Connolly LLP, said the DOJ “may have bit off more than it could chew” in trying to prove the vertical merger of a distributor and a supplier is violating antitrust issues. 

Likewise, CNN quoted an unnamed former Justice Department antitrust official as saying, “I suspect the DOJ is worried about their case and might be thinking about settlement. The government is in serious trouble.”

Certainly, the DOJ called up a range of witnesses from the pay TV industry, who each testified that a combined AT&T and Time Warner Inc. would create a company too big to effectively negotiate program licensing deals. 

RELATED: AT&T CEO testifies to benefits of Time Warner merger

However, on nearly every occasion, none of these witnesses were able to prove their cases convincingly under rigorous cross-examination by AT&T and Time Warner. 

Meanwhile, CNN reported that the judge overseeing the U.S. District Court for the District of Columbia case, Judge Richard Leon, doesn’t haven’t have to make a binary decision in regard to the outcome.

Notably, Leon has asked a number of questions to witnesses regarding Time Warner’s offer of baseball-style arbitration during program licensing disputes. 

When program licensing negotiations bog down, pay TV operators typically call out for such third-party arbitration to resolve the dispute. 

In this trial, operators have been inexplicably cool to the Time Warner offer, noting that its blind style of arbitration doesn’t let participants easily gauge the market value of what they’re bidding on.

For his part, Leon has asked several DOJ witnesses of they’d be more amenable to arbitration if it wasn’t blind. 

Suggested Articles

WWE Network, the WWE’s subscription streaming service, launched a free version of its service that will include access to new shows.

Virtual MVPD fuboTV is going live with its first gaming console app this week when it launches on Xbox One devices.

Alan Wolk, co-founder and lead analyst at TV[R]EV, looks into Quibi's surprising demographic success and HBO Max's early distribution woes.