T-Mobile accuses states suing to block Sprint merger of ‘dwelling in the past’

T-Mobile CEO John Legere poses with Sprint CEO Marcelo Claure before a Senate subcommittee hearing last June. (Twitter Photo)

T-Mobile is firing back at a coalition of states that sued to block the telecom company’s proposed merger with Sprint.

The Bellevue, Wash.-based carrier accused attorneys general from 13 states and the District of Columbia of “dwelling in the past” and stifling innovation in a court filing this week.

It’s a response to a lawsuit the states filed in June that claims the merger would hurt consumers by removing a wireless carrier from the market and ultimately raising prices. Federal regulators have raised similar issues as they’ve investigated the $26.5 billion merger that would bring together the nation’s third and fourth-largest carriers.

T-Mobile responded to the accusation Tuesday, arguing that the attorneys general do not have a firm grasp on how the merger would impact the wireless space. The company has long claimed that merging with Sprint will give it the resources necessary to take on the top two players, AT&T and Verizon.

“In short, each company provides what the other needs, creating a much more efficient, and therefore more competitive, firm,” the letter filed this week says. “Plaintiffs overlook the economic realities that there will be powerful incentives for New TMobile to monetize this dramatically increased capacity, by lowering prices to attract customers from Verizon, AT&T, Comcast, and others, sparking a new round of intense competition.”

The two telecom companies announced plans to merge in April 2018, creating a $146 billion wireless carrier under the T-Mobile brand. They have faced a number of regulatory and legal hurdles on their path to combine, which they hoped to complete by this month.

One of T-Mobile’s big selling points is 5G, the next generation of wireless technology. The company says joining forces with Sprint will accelerate U.S. 5G deployment, a key priority for the Trump administration. It’s an argument that has won over FCC Chairman Ajit Pai, as T-Mobile points out in the new filing.

“Rather than seize the opportunity, however, the Attorneys General of 13 states and the District of Columbia now ask the Court to deprive consumers in their own states and in the 37 others that have not challenged the merger of the benefits of New T-Mobile’s 5G network,” the filing says.

T-Mobile needs approval from the FCC and Department of Justice for the merger to go through. DOJ has reportedly been more reluctant to sign-off on the deal but is working with the companies to address antitrust concerns and sell off assets, potentially to Dish Network.

But the new lawsuit could throw a wrench in T-Mobile and Sprint’s plans. The two are considering extending their July 29 merger deadline, according to an anonymous source cited Thursday by The Wall Street Journal. The trial between the states and T-Mobile is scheduled to begin Oct. 7.

Read T-Mobile’s new filing below.

T-Mobile Lawsuit by GeekWire on Scribd