Consumers Appeal Suit Against T-Mobile/Sprint Merger

Twenty four customers of mobile service providers filed a notice of appeal in their case against the pending merger between T-Mobile and Sprint in the Northern District of California. Judge Beth Labson Freeman denied their request for a temporary restraining order, an order to show cause why a preliminary injunction should not be issued, and a motion for expedited briefing and discovery in February.

The plaintiffs in this case filed their complaint against T-Mobile and Sprint a few days before the trial on a suit in the Southern District of New York where Attorneys General from several states filed a suit against the merger for similar antitrust causes. That lawsuit failed to block the merger and New York, along with other states, decided not to appeal the decision. The plaintiffs in their complaint stated, “various of the States Attorneys General have sued T-Mobile and Sprint to prevent this merger from being consummated.  Intense political pressure is now being exerted to induce these states to drop their lawsuits, and some states have already capitulated to this pressure.” They claimed T-Mobile blatantly bribed state governments by offering free services and threatening them with obstructing innovation. New York cited as a reason for not appealing that T-Mobile had agreed to build an office in their state.

The consumers decided to appeal a similar decision when states decided not to. “Only competition can spur the innovation that will advance our technological progress as a nation.  And since it is the consumers who will be affected by this merger and who therefore must be represented, it has been necessary for these consumers to file this action to ensure that their voices may be raised to protect the interests of consumers,” the complaint stated.

The Order being appealed by the consumers held that the defendant mobile phone companies  provided evidence that the Department of Justice and the Federal Communications Commission had investigated the merger and determined it would “protect competition and promote the public interest.” They argued the deal would still maintain four providers in the United States and would preserve competition. The defendants claimed the merger would result in lower costs and a better network.

Alioto Law Firm represents the plaintiffs in the case. T-Mobile and their owner Telekom AG are represented by Cleary Gottlieb Steen and Hamilton. Sprint and their owner SoftBank Group Corp. are represented by Morrison & Foerster.