A group of 10 state attorneys general, led by New York Attorney General Letitia James, is filing a multi-state lawsuit to block the proposed merger of T-Mobile and Sprint while the US Justice Department’s decision looms.
“When it comes to corporate power, bigger isn’t always better,” James said. “The T-Mobile and Sprint merger would not only cause irreparable harm to mobile subscribers nationwide by cutting access to affordable, reliable wireless service for millions of Americans.”
The two companies announced the $26 billion merger last April, which would shrink the US’s national wireless carrier pool from four to three providers if approved. In the months following the announcement, lawmakers and consumer advocates have criticized the deal for being anti-competitive and fueled by false promises of 5G deployment and greater access to broadband in rural areas.
“American consumers owe a debt of gratitude to the state AGs for moving to block this merger,” Georgetown Law fellow Gigi Sohn said. “The record is clear that it will lead to higher prices and less competition and that the companies’ promises are speculative, not merger-specific and unenforceable.”
At least one regulator, the Federal Communications Commission, has decided that the merger creates more benefits than harms for consumers. The agency’s three Republican commissioners came out in support of the deal last month after the two carriers promised to spin off Boost Mobile into its own company and agreed to certain benchmark reports on deploying in-home broadband to rural areas.
The more significant threat to the merger may come from the Justice Department. After FCC chairman Ajit Pai came out in support of the deal, Reuters reported that antitrust staffers at the Justice Department had recommended that the law enforcement agency sue to block the merger. The Justice Department has yet to announce such a lawsuit. On Monday, the agency’s antitrust chief, Makan Delrahim, met with Pai to discuss its decision, which could come as soon as this week.