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AT&T, T-Mobile hire legal experts to save deal
TT Correspondent |  |  23 Sep 2011

AT&T Inc, Deutsche Telekom AG and T-Mobile USA have amassed an army of former senior government antitrust officials to try to save their $39 billion deal to combine wireless businesses, according to Reuters.

 

Questions abound for all sides: How strong is existing antitrust law? Can competition survive with the combination of two big wireless carriers? Or if the Justice Department succeeds in blocking it, will AT&T have to pay $6 billion in cash and wireless airwaves as a breakup fee to T-Mobile?

 

“Under the circumstances, I think they need the very best team they can put together,” said Bert Foer, president of the American Antitrust Institute. “It seems to me they have an uphill battle, and they need people who are capable of negotiating, but also capable of going to the mat if there is a trial.”

 

Several of the lawyers who make up the legal dream team for the wireless companies previously worked in top roles at either the US justice department’s antitrust division or the Federal Trade Commission’s competition bureau.

 

Among those hired are longtime antitrust negotiators who have worked on scores of acquisitions, as well as tough litigators such as Richard Parker. At least one lawyer, Richard Rosen, has been before Judge Ellen Huvelle, who is overseeing this case.

 

Last month the justice department sued to block the acquisition of Deutsche Telekom’s T-Mobile USA unit, the No. 4 US wireless carrier, by AT&T, which ranks second in that market. The companies hope to settle so the deal can close.

 

The companies can afford to hire the best of the best for the case, said Howard University School of Law professor Andrew Gavil, a longtime antitrust expert.

 

“Rich (Parker) is particularly known for being a really fine trial lawyer,” Gavil said. “That shows that they wanted to make sure if they have to go to trial they have a really good person who’s familiar with trying cases, not just thinking about them.”

 

Deutsche Telekom and T-Mobile hired Parker, who had worked at the FTC during the Clinton administration. Now a partner at O’Melveny & Myers LLP, he helped Triton Coal Co in its 2004 sale to Arch Coal, which the FTC tried unsuccessfully to block.

 

Revolving Door

 

As is often the case in Washington, many of the lawyers worked for the government before switching sides to use that experience on behalf of private clients -- typically for more money.

 

“It’s the revolving door of Washington,” Gavil said. “One of the things that attracts lawyers to public service is the ability to sell their expertise when they leave.”

 

During an 80-minute hearing on Wednesday to set the trial date, a parade of lawyers for all the parties filled the well of the largest courtroom in the federal courthouse and several benches in the audience.

 

Among them was AT&T’s longtime outside attorney, Richard Rosen of Arnold & Porter LLP. He represented the carrier and its predecessors in many deals, including a consent decree with the justice department for AT&T to buy Dobson Communications?. Judge Huvelle approved the settlement.

 

Also in the courtroom was Deutsche Telekom and T-Mobile lawyer George Cary of Cleary Gottlieb Steen & Hamilton LLP, who before that worked at the FTC in the Clinton administration. He was lead counsel in the agency’s successful challenge to Staples and Office Depot’s merger deal.

 

After leaving the FTC, he guided major deals, including AOL’s purchase of Time Warner?, through antitrust approvals.

 

AT&T’s lead lawyer during the scheduling hearing on Wednesday was a former federal prosecutor, Mark Hansen. He works for a smaller Washington law firm that focuses on litigation, including big telecommunications cases.

 

Sprint Nextel?, which has filed a separate lawsuit against the deal, hired its own star lawyer -- Greg Craig?, former White House counsel under President Barack Obama and now at Skadden, Arps, Slate, Meagher & Flom LLP?.

 

The Government’s Team

 

In recent years, the government has filed only a handful of antitrust lawsuits to block big mergers. One of the pending cases includes H&R Block?’s bid for 2SS Holdings Inc, developer of the TaxACT digital tax preparation business.

 

Lawyers for AT&T have been spotted at some of those proceedings, according to one source familiar with the matter.

 

The justice department has its own group of high-powered lawyers on the case. It has tapped the lead litigator in the H&R Block case, Joseph Wayland, to handle the AT&T and T-Mobile trial as well.

    
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23 Sep 2011(IST)  
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