One of the biggest media mergers in recent years appears on track to be completed after a federal appeals court handed a setback to the U.S. Justice Department by rejecting its attempt to block the AT&T-Time Warner merger.
The New York Times reports that Tuesday’s decision marks the second time the federal government has lost a court challenge to the $85.4 billion merger. The paper notes that the deal “has already begun to reshape much of the media industry.”
“A three-judge panel of the United States Court of Appeals for the District of Columbia rejected the government’s claim that a lower court had applied antitrust laws incorrectly in allowing the merger to proceed,” The Times reports. “Justice Department lawyers have argued that the combination of the two companies would reduce competition and hurt consumers.”
Writing on behalf of the panel, Judge Judith W. Rogers wrote: “The government’s objections that the District Court misunderstood and misapplied economic principles and clearly erred in rejecting the quantitative model are unpersuasive.”
The Times adds: “The Justice Department, which did not immediately respond to a request for comment, could choose to appeal to the Supreme Court. But the agency is unlikely to take that step, according to a person familiar with the case who spoke on the condition of anonymity because no final decision had been made.”
The report adds: “AT&T can now proceed with its plan to transform WarnerMedia into a streaming-video business in its version of the television industry’s go-to strategy. The company has said it would unveil several online video products by early next year, with the premium cable channel HBO anchoring a service that would feature films and TV shows from the Warner Bros. library. (HBO will continue to be available as a stand-alone service.)”