The trial that ultimately decides whether T-Mobile and Sprint can merge began in a Manhattan federal court Monday, and it’s clear that the presiding judge isn’t interested in a lengthy affair. U.S. District Judge Victor Marrero asked both sides to skip opening arguments to begin questioning witnesses immediately, and trim their witness lists.
Marrero, who has also presided over high-profile cases including the legality of the Patriot Act and Trump’s tax returns, said he didn’t want to be “beaten over the head” with testimony, according to the Wall Street Journal.
He also didn’t see the value in opening statements either. “What value do you see in opening statements in these circumstances?” he asked a T-Mobile attorney. The moves indicate that the judge is looking for a speedy resolution to the case. It is expected to take about three weeks for arguments to complete.
A total of 14 state attorneys general, including the D.C. attorney general, are suing to block the merger, arguing it is anticompetitive. The merger has already received the go-ahead by both the Justice Department and the Federal Communications Commission.
Marrero’s requests were heeded, with Sprint marketing officer Roger Solé and Boost Mobile executive Angela Rittgers among the first witnesses called by the states’ lawyers. Solé discussed the company’s efforts to lure consumers to the service but also talked about the company’s failure to retain those customers due to poor network quality. Rittgers explained to the court how prepaid companies target more budget-minded consumers.
The states presented evidence of a Sprint promotion in 2016 that matched its competitors, T-Mobile’s MetroPCS brand immediately lowered its prices.
They also submitted WhatsApp messages from 2017 between Solé and CEO Marcelo Claure, saying a T-Mobile deal would increase Sprint subscriber revenue by $5 per customer. Both efforts are aimed at weakening the carriers’ argument that the deal won’t harm competition, and won’t cause higher prices.
Toward the end of the day, Deutsche Telekom CEO Timotheus Höttges was called to the stand to discuss the dramatic turnaround in T-Mobile’s fortunes over the decade. The states’ lawyer Glenn Pomerantz noted that Deutsche Telekom had invested heavily in its U.S. arm, and “dug into its pockets,” continuing an argument that Softbank could do the same for Sprint.
While Höttges did not deny Deutsche Telekom spent quite a bit on improving T-Mobile’s service and network, he added the failure of the merger with AT&T played an essential part. AT&T paid a $3 billion breakup fee to T-Mobile as a result of the failed 2011 merger — and T-Mobile won a seven-year tower roaming agreement at no cost to the carrier from AT&T that only expired in the past year.
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