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AT&T’s Time Warner Merger Prevails In Long Appeals Battle With DOJ

AT&T's highly-publicized Time Warner mega-merger is allowed to stand, according to a federal appeals judge who ruled in favor of AT&T once again in its battle over its "vertical" acquisition with the Justice Department.

More than two years after AT&T first announced its intent to acquire entertainment giant Time Warner and seven months after a judge cleared the carrier's $85.4 billion Time Warner mega-merger, AT&T defeated the U.S. Department of Justice's bid to overturn the deal.

A federal appeals judge once again ruled in favor of AT&T on Tuesday, saying that the merger can be allowed to stand.

“The merger of these innovative companies has already yielded significant consumer benefits, and it will continue to do so for years to come," said David McAtee, AT&T’s general counsel, in a statement on Tuesday. "While we respect the important role that the U.S. Department of Justice plays in the merger review process, we trust that today’s unanimous decision from the D.C. Circuit will end this litigation.”

[Related: 5 Things Partners Need To Know About The AT&T/Time Warner Merger]

The deal, which has spent nearly two and a half years in the spotlight, has been considered a landmark case that could have an impact on merger and acquisition activity in the tech and telecom space.

AT&T first announced in October 2016 its intent to acquire Time Warner for its media content assets. The Department of Justice sued to block the deal in 2017, citing concerns that the merger between the two industry leaders would hurt competition and allow AT&T room to raise prices on its customers. Following a six-week long court battle, U.S. District Court Judge Richard Leon ruled in favor AT&T, giving the carrier the green light to go ahead with its $85.4 billion mega-merger without any conditions.

The DOJ in July filed a motion to appeal the case, after AT&T formally closed the deal after the court's decision in June. Time Warner has since been integrated into AT&T's portfolio in a group called WarnerMedia, which includes Turner, Home Box Office and Warner Bros. business units. AT&T in January reported that

Total WarnerMedia revenue was up 5.9 percent to $9.2 billion during its Q4 2018.

AT&T CEO Randall Stephenson said during the carrier's fourth-quarter 2018 earnings call in January that the carrier's top priority for last year and 2019 is to drive down debt from its Time Warner acquisition.

AT&T, for its part, has consistently pushed back against the DOJ's claims that it would remove competition in the market. The carrier has called the deal a "vertical" acquisition, meaning it would merge two companies that don't directly compete against one another.

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