June 12 (UPI) -- A federal judge on Tuesday approved a merger between AT&T and Time Warner, rejecting the U.S. government's argument that it would restrict pay-TV competition.
U.S. District Judge Richard Leon issued his ruling in Washington, D.C., more than six months after the Department of Justice sued to block the merger. Leon said federal officials failed to prove their argument that AT&T's $85.4 billion acquisition of Time Warner would lead to fewer choices for consumers and prompt higher TV and Internet prices.
"Vertical mergers like this one are routinely approved because they benefit consumers without removing any competitor from the market. We see no legitimate reason for our merger to be treated differently," David R. McAtee II, AT&T's senior executive vice president and general counsel, said in a statement after the Justice Department's lawsuit.
AT&T owns DirecTV and its acquisition of Time Warner would make it the biggest pay TV company in the country. Time Warner owns CNN, HBO, TBS and TNT.
Leon said he hoped the federal government would not further attempt to interfere in the merger, saying it would be "manifestly unjust."
"We are disappointed with the Court's decision today," Makan Delrahim, the head of the Justice Department's antitrust division, said. "We continue to believe that the pay-TV market will be less competitive and less innovative as a result of the proposed merger between AT&T and Time Warner."