The Justice Department will appeal a federal judge’s decision to allow AT&T to merge with Time Warner, according to a filing Thursday in the U.S. Court of Appeals for the District of Columbia.
The decision by U.S. District Judge Richard Leon to rule against the Trump administration and approve the $85 billion deal was expected to lead to a wave of additional acquisitions. The two companies completed the transaction on June and formed WarnerMedia.
“The Court’s decision could hardly have been more thorough, fact-based, and well-reasoned. While the losing party in litigation always has the right to appeal if it wishes, we are surprised that the DOJ has chosen to do so under these circumstances. We are ready to defend the Court’s decision at the D.C. Circuit Court of Appeals,” AT&T general counsel David McAtee said in a statement.
The government’s appeal could chill a number of potential transactions, including Comcast’s attempts to top the Walt Disney Company’s $71.3 billion offer for key 21st Century Fox assets. A Comcast spokesperson declined to comment.
The federal government in its initial case argued that an AT&T-Time Warner merger would force competitors to raise costs, ultimately harming consumers. Some industry experts previously speculated that AT&T’s decision to move forward with price increases in the aftermath of Leon’s ruling could spur the DOJ to pursue an appeal.
The telecommunications giant increased the cost of its DirecTV service in June to a minimum of $40 a month. A company spokesperson said the decision was made to bring “the cost of this service in line with the market.”
Prior to AT&T’s price hikes, competitors like Dish Network’s Sling TV and YouTube TV also raised their prices.
AT&T’s stock dropped 1.43 percent to $31.77 on the news in after hours trading on the New York markets.
