Some opponents of AT&T's pending acquisition of T-Mobile USA have asked the Federal Communications Commission to deny AT&T's request to withdraw its application for approval of the merger.
Public Knowledge and the Media Access Project, two public interest advocacy groups, claim that AT&T is withdrawing its application as a strategic maneuver in its antitrust litigation against the U.S. Department of Justice because it's afraid an opinion by the FCC about the $39 billion merger could bruise AT&T at trial next year in federal court in Washington, D.C.
"AT&T and Deutsche Telekom fear that the Commission's opinion as the relevant expert agency will hurt their arguments at trial," the organizations wrote in a filing with the FCC, "but the Commission has ample authority to continue to investigate the parties' application despite the consequences that investigation may have on AT&T's trial strategy."
In a blog Friday, AT&T's Wayne Watts -- Senior Executive Vice President and General Counsel -- asserted that the FCC had no right to stop AT&T from withdrawing its application. AT&T would legally challenge a decision by the FCC to prevent the company from withdrawing its application, Watts indicated.
Dallas-based AT&T moved to withdrew the application after learning that FCC Chairman Julius Genachowski was opposed to the merger and had circulated an order to his colleagues that would refer the matter to a hearing before an administrative law judge.
Deutsche Telekom, the owner of T-Mobile USA, on Nov. 24 revealed the companies withdrew their FCC applications in connection with the transaction but are continuing to pursue the sale of T-Mobile USA to AT&T.
"This formal step ... is being undertaken by both companies to consolidate their strength and to focus their continuing efforts on obtaining antitrust clearance for the transaction from the Department of Justice," Deutsche Telekom said. "As soon as practical, Deutsche Telekom and AT&T intend to seek the necessary FCC approval."
AT&T's critics claim the telecommunications giant is attempting to game the legal system.
"If AT&T is able to leverage this advantage favorably in the federal court system, it could then return to the Commission and seek approval again, without worrying that the Commission's informed expert opinion or factual investigation would harm AT&T's trial strategy in court," Public Knowledge and the Media Access Project stated, "while using any favorable court decision against the Commission in their future license transfer application."
In an emailed statement last week to Bloomberg, an FCC spokesperson said the agency would consider AT&T's request to withdraw.
Even if AT&T prevails against the Justice Department in a lawsuit scheduled for a February trial, the company still cannot acquire T-Mobile USA unless the Democrat-led FCC with only one Republican currently serving on the commission -- FCC Commissioner Robert McDowell -- finds the merger is in the public interest, convenience and necessity.
The Justice Department claims the merger between the nation's second- and fourth-largest wireless providers is anticompetitive and would burden tens of millions of consumers with fewer choices, higher prices and lower-quality products.
