A group of state attorneys general led by New York and California are filing a lawsuit to block T-Mobile’s $26.5 billion bid for Sprint, citing consumer harm.
The state AGs say the merger would hurt competition and drive up prices for cellphone service.
It’s an unusual step ahead of a decision by federal antitrust authorities. The Justice Department’s decision is pending. The Republican majority of the Federal Communications Commission supports the deal.
Other attorneys general joining Tuesday’s lawsuit are from Connecticut, the District of Columbia, Maryland, Michigan, Mississippi, Virginia, and Wisconsin. The lawsuit was filed in U.S. District Court in New York.
T-Mobile and Sprint say they need to bulk up to upgrade to a fast, powerful “5G” mobile network that competes with Verizon and AT&T. The companies are appealing to President Donald Trump’s desire for the U.S. to “win” a global 5G race.
Consumer advocates and several Democratic lawmakers worry that the deal could mean job cuts, higher wireless prices and a hit to the rural cellphone market.
T-Mobile and Sprint announced their merger more than a year ago, saying their combined pocketbooks and holdings of “spectrum,” or the airwaves that carry cellphone signals, could result in a better 5G network than what either company could build on its own. It’s an assessment several Wall Street analysts agreed with. The U.S. is in a politically sensitive race with China to be on top as this technology is developed and implemented.
The two companies previously tried to combine during the Obama administration but regulators rebuffed them. They resumed talks on combining once President Donald Trump took office, hoping for more industry-friendly regulators.