California Joins 8 States Filing Lawsuit to Block $26 Billion Telecomm Merger


FRESNO, CA (KMJ) – California joins 8 states filing a lawsuit Tuesday to block the proposed $26 billion dollar merger of telecommunications companies.

T-mobile and Sprint are the third and fourth largest wireless phone carriers, serving over 13 million California consumers.

Attorney General Xavier Becerra filed a lawsuit in New York challenging the acquisition as a violation of federal antitrust law, alleging that the merger would drive up prices for cell phone services.

Along with California and New York, attorneys general from Colorado, Maryland, Michigan, Mississippi, Connecticut, Virginia, Wisconsin and the District of Columbia have signed onto the lawsuit.

Becerra is co-leader of the group with New York Attorney General Letitia James.

“When it comes to corporate power, bigger isn’t always better,” said Attorney General James. “The deal is bad for consumers, it’s bad for innovation, it’s bad for workers.”

Both companies’ stocks fell on the news of the lawsuit.

Shares of Sprint dropped more than 5%, while T-Mobile fell 1%.

The companies finally agreed to their latest deal in April 2018, when T-Mobile and Sprint announced that after the merger a customer call center would open in Kingsburg by 2022.

The center would employ 1,000 people but only if the merger is approved.

T-Mobile and Sprint indicated that the expected closing date for the deal was pushed back to late July.


Click to listen to the report by KMJ’s Liz Kern: