On February 11, 2020, U.S. District Judge Victor Marrero of the Southern District of New York approved the proposed $37 billion merger between T-Mobile and Sprint, thus ending two years of regulatory uncertainty. The industry-altering deal combining the third and fourth largest telecommunications companies in the United States was announced in April 2018 and received approval from the Trump Administration the following year. However, attorneys general from thirteen states and the District of Columbia filed suit separately to block the deal, arguing that the sector consolidation would be anticompetitive and harm consumers. Spearheaded by New York and California, the coalition marked an unprecedented push by the states to tread a divergent path from Washington’s federal antitrust regulators. The district court’s blessing of the mobile wireless telecom merger holds implications for antitrust enforcement moving forward.The Deal
The T-Mobile and Sprint merger is not a new idea: there were talks between the two companies as early as 2014. However, these previous iterations failed to close, in part because of antitrust concerns. Encouraged by the “anything-goes world of megamergers” under the Trump Administration, the companies announced an all-stock deal on April 29, 2018, arguing that the transaction would concentrate the telecoms industry in hopes of (1) taking advantage of the benefits of scale to build out the first national 5G network and (2) generating significant cost and asset synergies, thus allowing the merged company to better compete with AT&T and Verizon. The Trump Administration’s Federal Communications Commission (FCC) and Department of Justice (DOJ) separately approved the merger in 2019, with the condition that T-Mobile divest portions of its business to Dish Network, a satellite TV service and provide it with access to the T-Mobile network. This remedy was negotiated in order to elevate Dish as a fourth major player in the national mobile wireless services industry.
The coalition of state attorneys general, who filed suit against the deal while the DOJ’s investigation was pending, chose to reaffirm its independent challenge to the merger under the federal Clayton Antitrust Act after the DOJ approved the deal. In response, T-Mobile and Sprint defended the merger, arguing that the combined company would pave the path towards nationwide 5G while lowering costs to consumers. After a two-week bench trial in December, Judge Marrero ruled in favor of the companies, stating that “T-Mobile has redefined itself over the past decade as a maverick that has spurred the two largest players in its industry to make numerous pro-consumer changes. The proposed merger would allow the merged company to continue T-Mobile’s undeniably successful business strategy for the foreseeable future.”Implications
Recent M&A trends indicate that the technology, media and telecommunications industries are increasingly looking to consolidate. Since 2018, mergers between AT&T and Time Warner, the Walt Disney Company and 21st Century Fox, and CBS and Viacom have been announced. The rise of global giants eager to acquire new technology, take advantage of economies of scale, and stifle competition has sparked public debate on the potential pitfalls of monopolization. In response, U.S. agencies have signaled an interest in holding intensified influence over such deals. For instance, in response to the public clamoring for more scrutiny of Big Tech, the Federal Trade Commission (FTC) and DOJ have announced investigations into prominent companies including Facebook and Google. However, in contrast with this rhetoric, the Trump Administration’s DOJ has concurrently taken an unprecedented active interest in filing amicus briefs in favor of large mergers, particularly in cases where it is not a party. This trend has potentially shifted corporate priorities in how to mitigate antitrust regulatory risk.
Against this backdrop, the final resolution of the T-Mobile takeover of Sprint is an interesting glimpse into how the government and the markets will respond to similar transactions moving forward. The intervention by state attorneys general, irrespective of success, indicates a more activist approach to state antitrust merger enforcement actions. Of particular note is the states’ departure from the typical pattern of coordination with federal regulators. As the DOJ increasingly exerts its sway in support of megadeals, the states’ willingness to proceed independently to litigation introduces a separate, more stringent, regulatory hurdle. Tim Wu, an antitrust law professor at Columbia Law School, has argued that this “has created a new role for the state . . . as a backdrop against federal failure.” Criticism of a more active state antitrust enforcement policy stems from the concern that it “shatters consistency in national economic policy.” Makan Delrahim, the DOJ’s top antitrust official, argued that state involvement in federal antitrust enforcement “is incompatible with the orderly operation” of antitrust law, and would “wreak havoc on parties’ ability to merge and the government’s ability to settle cases, and cause real uncertainty in the market for mergers and acquisitions.”
If this trend of independent state action continues, overcoming antitrust regulatory scrutiny will become increasingly complex. But Judge Marrero’s decision sheds some light on the tension between state and federal antitrust enforcement: it seems that for now, the federal antitrust officials retain the upper hand in policing antitrust matters. Judge Marrero wrote that the “the reality remains that the Court must now assess the Proposed Merger as conditioned by both regulators after lengthy review. Not only have the FCC and DOJ conditioned the transaction before the Court, the Court will accord their views some deference.” And furthermore, “the FCC and DOJ remedies . . . particularly those designed to ensure that DISH becomes an aggressive fourth national MNO [mobile network operator], significantly reduce the concerns and persuasive force of Plaintiff States’ market share statistics.” The lasting impact of this decision, and whether it will chill independent actions by state attorneys general, remains to be seen.
 T-Mobile and Sprint Win in Court; Companies Moving to Finalize Merger to Create New Supercharged Un-carrier, T-Mobile (Feb. 11, 2020), https://www.t-mobile.com/news/t-mobile-sprint-merger-court-win [hereinafter T-Mobile and Sprint Win]; Jennifer Saba, Breakingviews – SoftBank Gives Only an Inch to Clear Sprint Static, Reuters (Feb. 20, 2020), https://www.reuters.com/article/us-sprint-corp-m-a-breakingviews/breakingviews-softbank-gives-only-an-inch-to-clear-sprint-static-idUSKBN20F0F4.
 Justice Department Settles with T-Mobile and Sprint in Their Proposed Merger by Requiring a Package of Divestitures to Dish, U.S. Dep’t of Justice Off. of Public Aff. (Jul. 26, 2019), https://www.justice.gov/opa/pr/justice-department-settles-t-mobile-and-sprint-their-proposed-merger-requiring-package [hereinafter Justice Department Settles].
 State Attorney Generals File Lawsuit to Block T-Mobile and Sprint Merger, Wash. Post (Jun. 12, 2019), https://www.washingtonpost.com/context/state-attorney-generals-file-lawsuit-to-block-t-mobile-and-sprint-merger/4e39dfb2-3f8c-4b3e-a736-36a5bef49044/?itid=lk_inline_manual_3.
 Yuki Noguchi, T-Mobile and Sprint Merger Finally Wins Justice Department’s Blessing, NPR (Jul. 26, 2019), https://www.npr.org/2019/07/26/745544033/t-mobile-and-sprint-merger-finally-wins-justice-departments-blessing.
 Tara Lachapelle, Dealmakers, Beware: A ’52-Headed Monster’ is Watching, Wash. Post (Feb. 16, 2020), https://www.washingtonpost.com/business/dealmakers-beware-a-52-headed-monster-is-watching/2020/02/14/57d6874c-4f22-11ea-967b-e074d302c7d4_story.html
 T-Mobile and Sprint to Combine, Accelerating 5G Innovation & Increasing Competition, T-Mobile (Apr. 29, 2018), https://www.t-mobile.com/news/5gforall.
 Justice Department Settles, supra note 2.
 Dan Clark, 13 States’ Suit to Block T-Mobile/Sprint Merger Undeterred by DOJ Approval, AG Says, Law.com (Jul. 26, 2019), https://www.law.com/2019/07/26/nine-states-suit-to-block-t-mobilesprint-merger-undeterred-by-doj-approval-ag-james-says-292-50517/.
 T-Mobile and Sprint Win, supra note 1.
 Anna Nicolaou, A Second Wave of Media M&A is Coming, Fin. Times (Aug. 7, 2019), https://www.ft.com/content/9629af48-b8b3-11e9-8a88-aa6628ac896c; Wachtell Lipton Discusses Mergers and Acquisitions-2020, The CLS Blue Sky Blog (Jan. 23, 2020), https://clsbluesky.law.columbia.edu/2020/01/23/wachtell-lipton-discusses-mergers-and-acquisitions-2020/.
 Edmund Lee, T-Mobile and Sprint Are Cleared to Merge as the Big Get Bigger, N.Y. Times (Feb. 11, 2020), https://www.nytimes.com/2020/02/11/business/media/t-mobile-sprint-merger.html.
 See, e.g., Jacob M. Schlesinger et al., Tech Giants Google, Facebook and Amazon Intensify Antitrust Debate, Wall St. J. (Jun. 12, 2019), https://www.wsj.com/articles/tech-giants-google-facebook-and-amazon-intensify-antitrust-debate-11559966461.
 Key M&A Trends for 2020, Morrison Foerster (Jan. 16, 2020), https://www.mofo.com/resources/insights/200116-key-ma-trends-2020.html.
 Kadhim Shubber, Trump Administration Steps Up Push to Sway Antitrust Cases, Fin. Times (Jan. 20, 2020), https://www.ft.com/content/1fad936e-38a3-11ea-a6d3-9a26f8c3cba4.
 Id. (“Increasingly, persuading the justice department to weigh in on your side is a part of antitrust litigation strategy, according to defense lawyers.”)
 2019 Antitrust Year in Review, Wilson Sonsini, https://www.wsgr.com/images/content/2/0/v4/20330/Antitrust-Report-2019.pdf.
 Tim Wu, With One Move, New York Cuts Sprint and T-Mobile Down to Size, N.Y. Times (Jun. 12, 2019), https://www.nytimes.com/2019/06/12/opinion/sprint-tmobile.html.
 David McLaughlin, States Blocking T-Mobile’s Deal Would Disrupt U.S. Merger Policy, DOJ Says, Bloomberg (Feb. 5, 2020), https://www.bloomberg.com/news/articles/2020-02-05/t-mobile-deal-block-would-disrupt-u-s-merger-policy-doj-says.
 Brent Kendall, Trump’s Antitrust Officials Get Win with T-Mobile Verdict, Wall St. J. (Feb. 11, 2020), https://www.wsj.com/articles/trumps-antitrust-officials-get-win-with-t-mobile-verdict-11581460522.
 New York v. Deutsche Telekom AG, et al., No. 19 CIV. 5434 (VM), 2020 WL 635499, at *32 (S.D.N.Y. Feb. 11, 2020).
 Id. at 39.