DOJ Unlikely to Leak on T-Mobile/Sprint; Decision Expected in About a Month
Despite reports DOJ is nearing the end of reviewing T-Mobile's planned Sprint buy and that antitrust officials are skeptical of some of the companies' claims, outsiders know very little about how DOJ will come down or when it will make an announcement. Lawyers involved expect something from Justice in about a month, near the one-year anniversary of the April 29 announcement.
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“It’s very rare, if not unheard of, for the DOJ to leak,” said Seth Bloom, former general counsel of the Senate Antitrust Subcommittee. “The career staff know that it’s against the rules and they could lose their jobs.” Bloom works on the deal for Sprint.
One sign of hope for the two carriers is that a little more than five months after AT&T proposed its failed buy of T-Mobile on March 20, 2011, DOJ sued to block it, industry officials said. T-Mobile and Sprint announced almost 11 months ago and so far DOJ has apparently done nothing to hire outside counsel to help it if it tries to block the deal in court, officials said. Questions will remain until DOJ shows its hand.
Were the department to hire outside counsel, "then you’d be worried, but they have not,” Bloom said. That’s a “favorable” sign for the companies although DOJ doesn’t always hire outside counsel before seeking to block a deal, he said.
It's “a law enforcement agency and as a result, they are bound to keep information about their investigations confidential,” said Georgetown Law Institute for Technology Law & Policy distinguished fellow Gigi Sohn. “Information is currency in D.C., even if it is bad information. So nothing is going to stop people from guessing or putting their spin on things in order to gain a perceived advantage.”
“I strongly doubt that the rumors stem from actual leaks,” Robert McDowell of Cooley said of DOJ. “They don’t really telegraph these things.” McDowell is working for approval. “There is a good dialogue between the government and the parties,” he said.
DOJ antitrust staff is “conscientious about confidentiality,” said Tech Knowledge Director Fred Campbell. But Campbell is skeptical of easy approval. “DOJ has never approved a merger that would result in the level of spectrum aggregation that T-Mobile and Sprint are proposing,” he said. “Precedent indicates the agency will either move to block the merger or demand substantial spectrum divestitures. I’d be shocked if the agency approved it without conditions.”
DOJ lawyers “don't talk and they also have good poker faces, so speculation about what they are thinking has to be based on secondary sources,” said New Street’s Blair Levin. He said the best way to follow the DOJ is to watch the ex parte filings at the FCC. “While not an exact mirror of the DOJ, the ex partes are the best public evidence of the substantive debate that is also happening at the DOJ,” he said. The filings suggest “T-Mobile is still trying to get the ball over the finish line,” he said. They suggest “both changing story lines and new story lines,” Levin said: “That is not a death knell but it does provide good evidence that the original story line has not been sufficient to win at the staff level.”
Levin said no one at DOJ is saying a price freeze like the one proposed by T-Mobile won’t pass muster. He added that it’s “obvious to anyone who has studied antitrust that a behavioral condition like that violates the DOJ's belief system.”