Sprint sues to block AT&T's proposed T-Mobile buy

Tue Sep 6, 2011 7:38pm EDT
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NEW YORK (Reuters) - Sprint Nextel sued to stop AT&T Inc's $39 billion purchase of T-Mobile USA, staking out its own private antitrust claims alongside the U.S. government's challenge to the deal.

Sprint, the No. 3 U.S. wireless carrier, filed its lawsuit in the same federal court that is to hear the U.S. Department of Justice's case opposing the buyout. A fierce opponent of the deal, Sprint said the combination would lead to higher prices for consumers and create a duopoly between AT&T and Verizon Communications.

"AT&T's proposed takeover of T-Mobile is brazenly anticompetitive," Sprint said in court papers on Tuesday. Sprint said it would be marginalized by the buyout, and the deal "would force consumers to endure higher prices and be denied the fruits of vigorous innovation."

Sprint may have filed its own case in the event that the Justice Department comes to a settlement with AT&T, said Eleanor Fox, a professor at New York University School of Law.

"It may want to have its action out there just in case," she said.

A Sprint spokesman was not immediately available for comment. A spokeswoman for the Justice Department declined to comment on Sprint's move.

In a statement, an AT&T spokesperson said the company would contest Sprint's lawsuit.

"This simply demonstrates what we've said all along -- Sprint is more interested in protecting itself than it is in promoting competition that benefits consumers," said the spokesperson.

Sprint's lawsuit was assigned to Judge Ellen Segal Huvelle in Washington, D.C. She was selected at random last week to preside over the Justice Department's case.   Continued...

<p>A man checks his mobile phone as he walks past a T-Mobile store in downtown Los Angeles, August 31, 2011. REUTERS/Fred Prouser</p>