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A US judge ruled this week that T-Mobile can appeal a pending class action lawsuit that is seeking damages related to T-Mobile’s merger with Sprint
This week, Illinois U.S. District Judge Thomas Durkin has ruled that T-Mobile can proceed with an appeal of a class action lawsuit that could cost the company billions of dollars in compensation.
The class action lawsuit, which is being brough by seven subscribers of AT&T or Verizon, argues that the merger of Sprint and T-Mobile reduced competition in the wireless market to such an extent that it forced AT&T and Verizon to increase their prices. This, they say, saw tens to hundreds of millions of consumers paying more for their wireless services than they would have otherwise.
The plaintiffs are seeking monetary compensation as well as other remedies, which could even include the reversal of the Sprint–T-Mobile merger entirely.
Back in November, courts declined to dismiss the lawsuit at T-Mobile’s request, saying that AT&T and Verizon’s price increases could “plausibly” be linked to the merger.
T-Mobile immediately signalled their intention to appeal the decision, saying that the case’s “expansive conception of antitrust standing is unprecedented”.
The plaintiffs’ lawyers, on the other hand, argued that a length appeal process would delay potential compensation and could make dissolving the merger more difficult. They subsequently argued that the case should be put before a jury before an appeal was presented.
Now, Judge Durkin has confirmed that T-Mobile will be allowed to proceed with their appeal, with the operator arguing the plaintiffs’ have not sufficiently alleged antitrust standing.
Antitrust lawyers will be watching the proceedings of the case closely. Federal antitrust law allows consumers to bring private challenges against mergers and acquisitions, but cases arguing that a company’s M&A activity had negatively affected a rival’s customers are very rare.
If the case is ultimately allowed to proceed, it could significantly expand the scope of future antitrust proceedings.
Has the Sprint–T-Mobile merger negatively affected the US mobile landscape? Join the discussion live Houston, Texas, at this year’s Broadband Communities Summit
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