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AT&T customers hope to sue, block T-Mobile merger

by Phil Hornshaw

It seems nobody is happy about the possibility of AT&T (T) merging with T-Mobile and narrowing the field of wireless service providers – and lots of people are working to do something about it.

The latest to take to the legal field in an attempt to put a stop to the $39 billion deal, which still awaits Federal Communication Commission approval, is a group of 11 customers joining with a New York law firm, according to a story from PC World. The firm, Burson & Fisher, is working to find more customers to join the suit with its website, FightTheMerger.com.

Burson & Fisher and its clients hope to force AT&T into arbitration over the merger, with the hopes of preventing the situation everyone fears will result from the two carriers merging: higher prices and more customers joining AT&T’s already overstressed network. AT&T has been known to struggle with the glut of iPhone traffic it deals with, and for a long time was the phone’s only carrier. If T-Mobile merges with it, many expect the iPhone to become available on whatever becomes of the smaller carrier, and that will basically mean more iPhones on what could be the same network. Because the iPhone is so crazily popular, an additional carrier taking it on but using the same network doesn’t bode well for quality service.

Legal precedent cited

Customers who want to join in the fight to stop T-Mobile from joining with AT&T will have legal standing to do so, Burson & Fisher claim, under the Clayton Antitrust Act. Here’s a quote from PC World explaining it:

“The law allows an individual to sue a company to prevent mergers as long as the effects of the deal ‘may be substantially to lessen competition, or to tend to create a monopoly.’ Bursor & Fisher argue that the merger could result in higher prices, giving consumers the right to take action.

“‘Turning back the clock to the Ma Bell monopoly era will allow AT&T and Verizon to dictate what type of phone you can use, how you can use it, and what you will pay,’ the firm argues on the site. ‘It will destroy competition, leading to higher prices and worse service.’”

Of course, customers aren’t the only ones upset about the possible merger. Other wireless carriers such as Sprint have been working to fight it as well, and at least one lawmaker isn’t happy about the possibilities of fewer wireless carriers on the market. Court documents state that there are only 11 people in Burson & Fisher’s camp right now, but if that field expands substantially, the customers could at least appear to be a formidable group.

For its part, AT&T doesn’t seem to think Burson & Fisher or its clients have a leg to stand on, calling the claim “without merit” in a statement and stating that an arbitrator wouldn’t have any legal authority over the merger.