Sixteen states suing to keep T-Mobile and Sprint merger from happening

Oregon added itself to the list of states who are suing to keep T-Moble and Sprint from merging. This brings the total to 16 and giving the lawsuit more strength in its move to keep the competition in the telecommunications market from decreasing.

The US Department of Justice (DOJ) did approve the buyout of Sprint (the third largest wireless carrier) by T-mobile (the fourth largest wireless provider) in late July of this year for a $26 million deal. The approval comes with the condition that both T-Mobile and Sprint sell their prepaid businesses and wireless spectrum to Dish Network. When that happens it will make Dish Network the fourth largest wireless carrier in the US but it will be dependent on T-Mobile.

So this will in essence reduce the major telecom carrier providers to three: AT&T, Verizon, and T-Mobile as Dish will be dependent on T-Mobile because according to Letitia James, New York’s Attorney General Dish has no experience building or operating a wireless service network. 

The original lawsuit was filed on June 11, 2019 before the DOJ approved the merger.  The multi-state lawsuit is being co-led by Xavier Becerra, California’s Attorney General and NY Attorney General James

Originally, the lawsuit was filed by 10 attorney generals from California,  Colorado, Connecticut, Maryland, Michigan, Mississippi, New York, Virginia, Wisconsin and Washington, D.C.  Then the states of Hawaii, Massachusetts, Minnesota, Nevada, Oregon, and Texas joined in the last two months.

The 10 sates when filing the lawsuit argued that competition would be hindered by the merger which would raise prices and limit choices for customers because the merger would create a compressed market. 

The lawsuit states that the merger would cost Sprint and T-Mobile customers approximately $4.5 billon yearly which it insinuates is a conservative prediction provided by data from economists that were hired by Sprint and T-Mobile.

New York’s AG James says the addition of Oregon to the lawsuit shows that it is gaining support. She believes that this is a reflection that most of the country is behind their action in fighting this anti-competitive mega-merger. However, five states, Kansas, Nebraska, Ohio, Oklahoma, and South Dakota feel that the merger would provide better service for their rural residents as reported in the Kansas City Star on July 26, 2019.

T-Mobile, according to Reuters says it will not move forward on the merger until the multi-state lawsuit is settled.