Makan Delrahim, Assistant Attorney General in charge of the Antitrust Division of the Justice Department, in a speech this week described the DOJ challenge to AT&T/Time Warner merger as “David vs Goliath,” with the DOJ as David and the merging parties as Goliath. Delrahim said, "We are 30 lawyers against 700, but as my rabbi used to say, David beat Goliath for a reason, because he was right."
It is not clear where AAG Delrahim got his figure of 700 attorneys for AT&T and Time Warner, but casting the Department of Justice as “David” seems a bit of a stretch. The Justice Department is sometimes described as the world’s largest law firm, and the Antitrust Division alone has about 400 attorneys (I used to be one of them). Having 30 attorneys working on a case is not a small number, and if they are not enough, AAG Delrahim has plenty more working for him. Moreover, most private parties that have litigated against DOJ, with all the resources of the federal government behind it, don't think of DOJ as the "David" in the fight.
Delrahim also criticized those have been critical of the merger, saying, "In the U.S., we now have thousands of vertical merger experts, who somehow think we haven't enforced anything in 50 years."
As I explained in my Perspectives from FSF Scholars earlier this month providing substantive analysis of the AT&T/Time Warner merger and the context in which it should be reviewed, the U.S. antitrust agencies have challenged dozens of vertical mergers in recent decades. What is different is that those challenges were all resolved with the parties agreeing to behavioral conditions that allowed the mergers to go forward, while AAG Delrahim’s Antitrust Division is seeking to force fundamental structural changes on the AT&T/Time Warner merger. The last time the U.S. government went to court seeking structural changes to a vertical merger was in 1979, when the Federal Trade Commission lost its challenge to truck trailer manufacturer Fruehauf’s acquisition of a brake component supplier.
The trial is scheduled to begin March 19, 2018.