10 U.S. states sue to block T-Mobile-Sprint merger


A Sprint technician demonstrates the installation of a Massive MIMO, a multiple input and output radio antenna combo for 4G and 5G manufactured by Nokia, on top of a building in New York on Tuesday.

ReutersWASHINGTON (Reuters) — Ten states led by New York and California filed a lawsuit Tuesday to stop T-Mobile US Inc.’s $26 billion purchase of Sprint Corp., warning that consumer prices will jump due to reduced competition.

The complaint comes as the U.S. Justice Department is close to making a final decision on the merger, which would reduce the number of nationwide wireless carriers to three from four.

The all-Democratic attorneys general from the 10 states, including Colorado, Connecticut, the District of Columbia, Maryland, Michigan, Mississippi, Virginia and Wisconsin, say the reduced competition would cost Sprint and T-Mobile subscribers more than $4.5 billion annually, according to the complaint.

“When it comes to corporate power, bigger is not always better,” New York Attorney General Letitia James said at a news conference.

“To many upstate New Yorkers, [the carriers] still struggle with 3G,” she said, adding that there is nothing in the merger that will guarantee more towers and coverage for certain communities.

James said the lawsuit was not filed to influence the Justice Department’s decision on the merger, adding that negotiations were ongoing among the states, the Justice Department and the carriers.

James also said her office did not notify Justice before the states filed the lawsuit, adding it was not required for them to do so. State attorneys general often participate in lawsuits aimed at stopping mergers but rarely go it alone.

The complaint was filed in the U.S. District Court for the Southern District of New York.

“This is the third time T-Mobile has tried to merge and shrink the market to three players,” said California Attorney General Xavier Becerra.

“Every time they’ve tried they’ve been blocked or forced to walk away because of opposition from the government … Opposition that’s based on the same concerns laid out in our lawsuit today.”

T-Mobile, whose parent company is Deutsche Telekom AG, and Sprint, controlled by SoftBank Group Ltd., did not comment. A spokeswoman for Federal Communications Commission Chairman Ajit Pai declined to comment. The Justice Department did not respond to a request for comment.

The T-Mobile-Sprint deal has won the backing of a majority of the FCC. The U.S. Justice Department’s antitrust division staff has recommended the agency block the deal, but no final decision has been made.

Calling the proposed merger “anti-competitive, anti-worker and anti-consumer,” Connecticut Sen. Richard Blumenthal said the Justice Department “must follow the leadership of state AGs” who are fighting back for consumers.

“Saying no to this deal should be easy,” Blumenthal said in a tweet.Speech

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