U.S. Justice Department lawsuit over AT&T’s Time Warner acquisition appears imminent

The U.S. Department of Justice plans to file a lawsuit to prevent AT&T from gobbling up Time Warner for $85.4 billion, according to multiple reports.

The acquisition initially looked like it would go through but a few weeks ago, Makan Delrahim took over as the new U.S. antitrust chief, investigating the deal. He urged the companies to sell off assets to avoid competition concerns, to no avail, according to Bloomberg.

GeekWire asked whether Washington Attorney General Bob Ferguson plans to join the legal battle. A spokesperson said that the AG’s office had received a complaint from the Justice Department but declined to comment further.

It’s the first major acquisition to go before the Trump administration. A similar deal went through under President Barack Obama, allowing Comcast to acquire NBC Universal with extensive conditions.

“Today’s DOJ lawsuit is a radical and inexplicable departure from decades of antitrust precedent,” said AT&T General Counsel David McAtee in a statement. “Vertical mergers like this one are routinely approved because they benefit consumers without removing any competitor from the market. We see no legitimate reason for our merger to be treated differently.”

One major concern over the AT&T-Time Warner deal has to do with streaming video. Exemptions from mobile carriers allow many customers to stream video without incurring hefty data charges. The combination of AT&T and Time Warner could give a big advantage to streaming services associated with the combined corporation.

Time Warner is best known as the owner of HBO, Turner, CNN, Warner Brothers and DC Entertainment, and some may recall that it merged 16 years ago with — at the time — tech powerhouse AOL.