A group of 10 attorneys general filed a federal lawsuit on Tuesday to block the merger of Sprint and T-Mobile, throwing up a new hurdle to the deal that would combine the nation’s third and fourth largest wireless carriers, according to this report by Bloomberg. The suit, led by California and New York, says the deal would hurt competition and raise prices for consumers.
The legal action may put Makan Delrahim, antitrust chief for the Justice Department, in a bind, according to the report. He could approve the deal as is, effectively a bet that the states will fail in court, or he could seek changes to the agreement to ease the concerns of the attorneys general. Meanwhile, the Federal Communications Commission’s head Ajit Pai has said he supports the deal as is. And then there’s President Trump, who’s been arguing forcefully that the U.S. needs to establish a lead in 5G wireless technology. When the two companies announced the deal, they said it would allow them to deploy 5G faster.
There’s no timetable for a Justice Department to weigh in on the merger, but there’s no doubt that the suit has given Mr. Delrahim—and the companies—something new to think about right now.