The ruling by Judge Richard Leon bit.ly/2Jxx6qE of the U.S. District Court for the District of Columbia brings an end to a six-week antitrust trial in which U.S. regulators argued that the $85 billion deal would give AT&T undue leverage against rival cable providers that relied on Time Warner's content.
AT&T and Time Warner dismissed the government's concerns.
The merger would create a media and telecommunications powerhouse, reshaping the landscape of those industries.
The acquisition means AT&T will be the nation's top pay-TV distributor. Looming in the background of the deal has been Trump's long-running feud with Time Warner's CNN, which he has often derided as "failing" and a purveyor of "fake news".
A ruling in favor of AT&T would also ease the path for a merger.
The merger will consolidate AT&T's telecommunications services with Time Warner's content, which includes some of the biggest names in media like HBO, CNN, and sports broadcasts from the National Basketball Association and NCAA. It would also be the 12th largest deal in any sector, the data showed. We thank the Court for its thorough and timely examination of the evidence, and we compliment our colleagues at the Department of Justice on their dedicated representation of the government. He also warned that the government might try to find a way around the courts to block the deal.
To assuage the Trump administration's criticisms, AT&T offered to submit pricing disagreements with other pay TV companies over Turner's channels to third-party arbitration. That's not to say that vertical mergers get through regulatory approval free and clear - the FTC has fought 22 vertical mergers since 2000 - but they receive less scrutiny than horizontal mergers. The Justice Department sued to block the deal from going through in November of 2017, arguing that it would limit competition and raise prices.
"Put me on the side of the fence of thinking that AAG (Makan) Delrahim is interested in challenging the next problematic vertical transaction", she said.
AT&T claims that with a purchase of Time Warner, they'll be able to compete in the grand scheme of internet and TV into the future.
AT&T applauded the court's decision. The corporate combination promises to unleash even more megamergers in the fast-changing digital media space.
Time Warner controls assets such as HBO, CNN and, most importantly, Warner Bros.
In May it was revealed that AT&T had paid Michael Cohen, Trump's personal attorney, $600,000 for consultancy fees as it attempted to woo the White House.
But AT&T failed to provide any evidence suggesting that the DOJ's prosecution of the merger had "discriminatory effect and discriminatory intent", Leon said in a ruling earlier in the trial.
"It's more that they just didn't lose". AT&T CEO Randall Stephenson also said previous year, "You shouldn't expect that we would sell something larger [than CNN] to get the deal done".
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