Lawmakers Ask for Delay of AT&T;’s Purchase of BellSouth
The chairman and the top Democrat on the House Judiciary Committee have asked the Justice Department to delay approval of AT&T; Inc.’s $67-billion purchase of BellSouth Corp.
Reps. F. James Sensenbrenner Jr. (R-Wis.) and John Conyers Jr. (D-Mich.) sent a letter to Atty. Gen. Alberto R. Gonzales on Wednesday asking for the delay until a federal judge decides whether SBC Communications Inc.’s purchase of AT&T; Corp., as well as Verizon Communications Inc.’s acquisition of MCI Inc., were in the public interest.
On Thursday, the chairman of the Senate subcommittee that deals with antitrust matters, Sen. Mike DeWine (R-Ohio), added his voice to the cautionary chorus. He and the panel’s top Democrat, Sen. Herb Kohl of Wisconsin, asked the Justice Department and the Federal Communications Commission to consider imposing conditions on the acquisition “if they are necessary to help ensure that the telecommunications market remains open to new sources of competition.”
Among their concerns: the amount of wireless spectrum that the combined companies would control.
A day earlier, Kohl and Sen. Patrick J. Leahy of Vermont, the senior Judiciary Committee Democrat, wrote a similar letter questioning whether the Justice Department had been approving buyouts too hastily, counter to the intent of federal law.
AT&T; Inc. announced in March that it was buying BellSouth. The deal must be approved by both the Justice Department and the FCC before it can close.
Late last week, FCC Chairman Kevin J. Martin circulated an order at the agency recommending approval of the acquisition, according to sources familiar with the document, which cleared the way for a vote as early as the Oct. 12 commission meeting.
At the same time the FCC and the Justice Department are considering whether to approve that deal, a federal district court judge in Washington has been hearing arguments on whether a consent decree, reached between the Justice Department and SBC-AT&T; and Verizon-MCI, is in the public interest.
The decree allowed the buyouts to go forward but attached some conditions to preserve competitiveness.
The judicial review is required by the 1974 Tunney Act, which says any consent decree that settles an antitrust investigation must be approved by a judge. There is no way of knowing how long that review will take.
Sensenbrenner and Conyers asked that the Justice Department “refrain from issuing any final decision in the proposed AT&T;/BellSouth merger until the court issues its public interest determination as required by this act.”
The Leahy-Kohl letter accuses the department of putting the cart before the horse -- allowing buyouts to close before the judicial review takes place, a practice they said “effectively negates the requirement of public interest judicial review.”
They added that if a judge rejected a consent agreement, it would be a “pointless exercise given the difficulty in unwinding a merger that has already been completed.”
Justice Department spokeswoman Gina Talamona said Thursday that the department was aware of the letters and would respond as appropriate.
AT&T; spokesman Dave Pacholczyk said the company saw no reason for a delay. “These are different mergers. Our merger with BellSouth is proceeding along a separate path, and it’s not part of this court’s review,” he said.
