| | | | "We've brought an important, and in many ways potentially historic, lawsuit," Makan Delrahim said Tuesday morning, talking about his case against AT&T and Time Warner.
Does that make Tuesday afternoon's ruling a historic rebuke of the Justice Department antitrust division?
Delrahim's lawyers "failed," Judge Richard Leon said in a 171-page ruling on Tuesday: "The government has failed to meet its burden of proof to show that the merger is likely to result in a substantial lessening of competition."
Delrahim did not commit to appealing right away. He only said the DOJ will consider "next steps." He has to be thinking about what Leon wrote -- especially the part about why the DOJ shouldn't ask him to put the ruling on hold.
If the DOJ does go ahead and asks the appeals court for a stay anyway, and gets it, the deal could still be imperiled. Otherwise, AT&T will take control of the Time Warner assets in about a week. John Stankey will succeed Jeff Bewkes and begin to introduce himself to employees. Per VF's Joe Pompeo, Stankey will hold town halls next week with TW's three divisions, HBO, Warner Bros. and Turner... | | "A big blow for the government" | | | Gold and Jessica Schneider led our coverage of the trial and Tuesday's decision. On CNN, Schneider called it "a big win for AT&T and a big blow for the government..." She said Leon "ripped apart the government's case..." | | | "The ball is in DOJ's court on whether they seek an injunction and appeal the decision," a source texts. Here's Hadas Gold's full story about the next steps... | | Up next: A bidding war for Fox? | | "The battle for the future of media has begun," Edmund Lee wrote Tuesday night in his first story for the NYT.
He reports that "Comcast's board met Tuesday evening to discuss its revamped bid for Fox, which rebuffed an overture last year."
Comcast isn't commenting, but the company is expected to formally make its offer as early as Wednesday morning... | | What's the next chess move? | | | Shares of CBS, Viacom, Lionsgate and Discovery "were all up after hours," CNNMoney's Jill Disis reports. "Those companies have either said publicly that they want to explore mergers or have been mentioned as potential targets for acquisition." More... | | Brian Lowry emails: There has never been a riskier time to embark on these deals, given the rapid change that's happening because of new technology AND the wild cards in terms of competition from major tech players, which have the resources to both alter the rules and build their own alternatives from scratch...
>> THE BIG PICTURE: David Goldman explains how this is a "landmark court ruling for media and business..." | | CNN chief legal analyst Jeffrey Toobin was in court on Tuesday. Afterward, speaking on TV, he did not hold back. He said the DOJ's loss renews questions about why the case was brought in the first place.
Was it political? Did President Trump's public desire to kill the deal translate to private interference or other undue influence? The DOJ and the White House have denied that, but it's going to be a big part of the conversation going forward. "This has Donald Trump's fingerprints all over it," Toobin said on "AC360." Here's my related story... | | Time Warner says the lawsuit was "political" | | We know Time Warner's POV on this. Chief spokesman Gary Ginsberg said Tuesday that "the Court's resounding rejection of the government's arguments is confirmation that this was a case that was baseless, political in its motivation and should never have been brought in the first place."
AT&T declined to comment on that... | | "Whether it was or not, the case always felt political," Andrew Ross Sorkin wrote after the ruling. He said the suit "never made sense on the merits of the case." Looking back, the case will "almost certainly be seen through a political prism of speculation about what motivated it."
Remember when Rudy Giuliani said "the president denied the merger," but then said "he told me directly he didn't interfere?"
Sorkin asked: "Was it one of those? Or something in between? We still don't know. And that's the problem. The calculus for companies considering mergers -- or any decision -- shouldn't be whether they think a president will seek to block or approve it on a whim..." | | Hey, Delrahim had it right, back in 2016 | | Bloomberg Opinion's Joe Nocera with a 💯 lede: "So it turns out that Makan Delrahim had it exactly right back in the fall of 2016 when he told BNN Bloomberg in Canada that he didn't see any 'major antitrust problem' with the proposed AT&T-Time Warner merger. Of course, Delrahim was then still a Pepperdine University law professor, and Donald Trump was still just a candidate for president. But a month later, Trump won the election, and two months after being sworn in, he nominated Delrahim to be the head of the Justice Department's antitrust department. And just like that, Delrahim was singing a very different tune."
Here's the rest of Nocera's column... | | | Hadas Gold will be back on "New Day" in the 6am hour... I'll be on in the 8am hour... | | "This was a defining case for antitrust enforcement in the US. It does seem to be a complete and total victory for AT&T."
--Former Justice Department antitrust attorney Ketan Jhaveri to CNNMoney's David Goldman... | | How reporters found out about the ruling | | Hadas Gold emails: Line sitters started lining up the night before, and the hallway outside the court was a buzz of activity throughout the morning. Once we entered the courtroom shortly before 4pm, the place went on lockdown -- workers closed the windows and told us no one was allowed to leave until the end of the hearing.
Leon was careful, measured, reading from his opinion. He didn't make a grand ruling at the beginning, instead going point by point. But it was clear from his first point knocking down the government's arguments that it wasn't going to look good for the DOJ. At one point he called the government's evidence – specifically regarding the allegation that AT&T and Time Warner would restrict HBO use by rivals -- "gossamer thin." | | How the rest of us found out | | | At CNN in DC, NYC and Atlanta, those of us involved in the coverage waited to hear Gold's voice on our conference call line. Since there were no phones or laptops allowed in court, it was quiet for most of the 4pm hour. Then, all of a sudden, we heard: "This is Hadas. AT&T won completely..." | | | >> Stephenson and Bewkes found out in a similar fashion. Stephenson, at AT&T HQ in Dallas, got a call from general counsel David McAtee... Bewkes also found out by phone... | | Somewhat surprisingly, Delrahim was willing to answer a few questions afterward. But he looked pretty downcast.
 AT&T and Time Warner's lead lawyer, Daniel Petrocelli, held a triumphant presser. "The case stands as a testament to the wisdom of this combination of these two great companies, and how it will benefit consumers for generations to come," Petrocelli said. "We're disappointed that it took 18 months to get here, but we are relieved that it's finally behind us." | | Ginsberg and other Time Warner execs headed off to a celebratory dinner at Fiola Mare in Georgetown.
The AT&T legal team went out for dinner as well -- the two companies still dining separately for now... | | Via CNNMoney's Julia Horowitz and Danielle Wiener-Bronner: By our count, the judge used at least 12 exclamation points. Exclamatory phrases included:
"Please!"
"Poppycock!"
"Go figure!"
As Judge Leon might say, "Touche!" | | This case came with "staggering" costs | | If I had to guess, I'd say this paragraph of Leon's decision was the favorite passage of AT&T and Time Warner execs. It echoes a complaint I have heard many times:
"The Government has had this merger on hold now since October of 2016 when it launched its investigation. In that 18-plus month period, the companies have twice extended the break-up date to accommodate the Government's litigation of this case. During that same period, the video programming and distribution industry has continued to evolve at a breakneck pace. The cost to the defendants and the Government to investigate, litigate, and try this case has undoubtedly been staggering -- easily in the tens of millions of dollars..." | | What the deal's critics are saying | | As the NYT noted here, the DOJ's position against the deal "also had the backing of some left-leaning politicians and antitrust experts."
One of the deal's critics, Professor Tim Wu, was on CNN shortly after the ruling. He told Jake Tapper that vertical mergers, not just the horizontal kind, "also cost consumers money, also interfere with competition." He said the ruling "sounds like the old 1980s, Reagan-style, nothing vertical is ever suspect" attitude... | | Bloomberg's Lucas Shaw tweeted: "I've seen a lot of stories about how important this AT&T/TWX ruling is. Allow me to be the contrarian. This case only mattered if a judge had blocked the merger. That would have contradicted decades of anti-trust law, and created a precedent to block vertical mergers. Instead, a pay-TV/phone company bought a media company." Just like Comcast/NBC. "The media industry hasn't been transformed by that deal as much as it has been by YouTube, Netflix, Instagram, Twitter and Snapchat."
Shaw's point: "Comcast has been a very effective owner of NBCU, but it hasn't really changed the way we watch TV or movies. Do we think AT&T is going to do something revolutionary with HBO or TNT? Or did it just buy a good asset?"
Speaking of Comcast... | | How will Disney respond to Comcast's bid? | | Right after the ruling, BTIG's Rich Greenfield told me, "Brian Roberts and Team Comcast are cleared to bid. The question is whether Disney is ready because unlike in 2004, Comcast is in it to win!"
More media drama to come. I was struck by the quotes in Meg James' LAT story the other day... One of Roberts' direct reports, NBCU CEO Steve Burke, told James that "this is very personal for Brian. Comcast is the only company he has ever worked for and the only company he will ever work for. In some ways, the company is his life's work." You'll notice that Burke avoided talking about the Fox bid directly... But "this is very personal" certainly applies to that...
Burke also said: "Brian never gives up. We have worked on a lot of deals together and he just out-hustles everyone. He's a very persistent guy." | | Amazon eyed the Fox assets?! | | A scoop buried at the end of Shalini Ramachandran's latest WSJ story:
"Amazon explored the idea of splitting up the Fox assets with Comcast -- whereby Amazon would get the domestic properties and Comcast would get international assets -- but the idea didn't advance so Comcast is proceeding on its own, people familiar with the matter said." | | BTW: Now what about the Sinclair-Tribune deal? | | Newsmax CEO Christopher Ruddy, an outspoken opponent of the Sinclair deal, weighed in on Tuesday:
"While the AT&T merger raised some legitimate questions of media concentration, the opinion of the federal judge today should put the matter to rest. AT&T will also be a good custodian of CNN. The AT&T merger pales in comparison to the Sinclair-Tribune merger, which effectively guts network ownership caps and will allow for the most massive concentration of broadcasting power in history. The FCC's and DOJ's unusual green lighting of the Sinclair deal is completely inconsistent with the government's opposition to the AT&T deal and raises questions about fairness and political favoritism."
Right now the Sinclair bid for Tribune is still in a holding pattern at the FCC... | | -- BREAKING from the WashPost: "A Customs and Border Protection agent faces inquiry after allegedly asked a reporter about her sources." The reporter was Ali Watkins, whose phone and email records were seized in connection with the James Wolfe case... (WashPost)
-- And here is Sophie Tatum's followup story for CNN...
-- Legal action by CNN and CPI has prompted the Puerto Rican government to release "a database of information on all deaths that occurred after Hurricane Maria..." (CNN)
-- The News Media Alliance and a broader coalition called STOPP are fighting the Canadian print tariffs that are "beginning to choke local American newspapers." Details here... (Axios) | | Trump gave four TV interviews after meeting Kim Jong Un | | Trump is on the way back from the Singapore summit. While on the ground, he taped four interviews... One with ABC's George Stephanopoulos, one with Voice of America's Greta Van Susteren, and two with Fox.
The first Fox sit-down, with Sean Hannity, aired Tuesday night. The second, with Bret Baier, will air Wednesday night. The Baier interview is notable because Trump favors the network's opinion hosts over newscasters. Baier hasn't landed a Trump interview since 2016. The Q&A was taped on board Air Force One before Trump took off. It'll be interesting to see if Baier asked about domestic issues, the Mueller probe, etc... Or if, like Stephanopoulos, he focused on North Korea... | | The point of the interviews? | | Trump's apparent goal: To persuade the wider public, not just his base, that the summit was a success. As I noted in this story, the interview with ABC was Trump's first interview with a major network not named Fox in 13 months. And Tuesday's presser was Trump's first formal press conference in 16 months...
--> The Daily Beast's Maxwell Tani caught this: "Hannity spent the first part of his show arguing that the media treated Trump unfairly in Singapore. Yet when he asked Trump about the coverage, Trump had some complaints, but told him: 'Honestly, they've been treating me very good on this subject - what's to treat badly?'"
--> Later in the day, Trump's view evidently changed. While aboard AF1 over the Pacific, during Tuesday prime time in the U.S., he tweeted, "A year ago the pundits & talking heads, people that couldn't do the job before, were begging for conciliation and peace -- 'please meet, don't go to war.' Now that we meet and have a great relationship with Kim Jong Un, the same haters shout out, 'you shouldn't meet, do not meet!'" | | -- Max Boot summed it up this way: "The Singapore summit was a mesmerizing spectacle utterly lacking in substance. In other words, it was a perfect microcosm of the Trump presidency..."
-- There was lots and lots to fact-check. Here's what the NYT found...
-- WashPost columnist Kathleen Parker: "Trump and Kim meet, shake -- and lie through their teeth..."
-- About that odd movie trailer-style video: "Reporters thought this video was North Korea propaganda. It came from the White House..."
-- Margaret Sullivan's media critique: "The North Korea summit was a triumph of Trumpian stagecraft, and the media fell for it..."
-- Nate Silver with a very different view via Twitter: "90% of the punditocracy's commentary on the Singapore summit seems to be constructed with the goal of convincing people that Trump shouldn't get any credit for it -- rather than rationally analyzing the merits and demerits of the 'deal.'" | | Trump 2020 campaign manager says Acosta should have his press credentials "suspended" | | Oliver Darcy emails: The right-wing media machine set its sights on Jim Acosta on Monday and Tuesday, attacking the CNN chief White House correspondent for the mere act of peppering Trump and Kim Jong Un with questions during the summit. The misleading and senseless attacks found their way out of the far-right fever swamp and on Fox News -- which characterized the simple act of Acosta asking questions as "grandstanding." (Of course, as Andrew Kaczynski pointed out, Fox News had a "radically different" take on Acosta when he was pressing Raul Castro during the Obama administration. At that time, the folks over at Fox News appeared to be a fan of his journalism.)
The outrage cycle was elevated even more when Brad Parscale, the Trump 2020 campaign manager, tweeted that as a result for asking Trump questions during the signing ceremony, Acosta "should immediately have his press credentials suspended."
Fox News predictably covered Parscale's comments with a prominent story on its homepage, making the feedback loop complete...
--> Recommended: Acosta wrote about his Singapore experience here... | | This week's cover of People mag | | | People's cover, out Wednesday, includes the National Suicide Prevention Lifeline # (800-273-8255) at the very top of the page... | | -- "Sen. Ted Cruz will face off against late-night host Jimmy Kimmel in a game of one-on-one basketball Saturday, with the proceeds to benefit two Houston-based charitable organizations, the comedian announced Monday night..." (CNN)
-- Brent Lang's big new story: "Inside Jason Blum's Plan to Take TV by Storm..." (Variety) | | "Timeless" Megyn Kelly time slot chatter | | Page Six's latest on Megyn Kelly: "NBC mulls moving 'Megyn Kelly Today' to a new time slot." The story cites the 9am hour's ratings difficulties.
>> NBC's push-back? The story says "a network source pointed out that Kelly's numbers are heading upward, and another quipped, 'Just another 'timeless' rumor about Megyn Kelly.'" Radar wrote a similar item back in January... | | This is not going to happen | | Alec Baldwin 2020? No, no, no. But still: "During an interview with Howard Stern on Monday, Baldwin said that if he made a bid for the White House, he would 'one-thousand percent' prevail as the winner over President Trump," Chloe Melas reports.
"If I ran, I would win," Baldwin bragged to Stern. "I would absolutely win..." | | "Infinity War" joins an exclusive box office club | | Frank Pallotta emails: "Avengers: Infinity War" has reached another box office milestone. The Disney blockbuster passed the $2 billion mark at the worldwide box office on its 48th day in theaters.
--> "Infinity War" joins only three other films that have made that much: "Avatar," "Titanic" and "Star Wars: The Force Awakens." The Marvel film is unlike the other films, however, since those three films were all released in December... | | | What it lacks in viewership, it makes up for with critical acclaim. Starz has renewed "Vida," the half-hour drama from Tanya Saracho, "for a second season," THR reports. "A return date and episode count has not yet been determined..." | | Oprah, Warner Bros. is holding on line one 😃 | | | Megan Thomas emails: Oprah Winfrey told "Entertainment Tonight" co-host and CNN contributor Nischelle Turner she'd love to be the ninth member of the all-female crew if there's a sequel to "Ocean's 8." (Safe to assume that would get an easy green light...) | | Kanye tweeted out Lisa's story about this... | | | Lisa Respers France emails: So much for angry fans abandoning Kanye West. His entire album has debuted on the Top 40 and is his eighth straight no. 1 album, putting him in the rarefied company of Eminem and The Beatles... | | | For the record, part three | | | By Lisa Respers France:
-- Childish Gambino surprised some Chicago students with a special performance...
-- After his expletive-laden rant about Trump, Robert DeNiro apologized -- to Canadians...
-- Actress and activist Rose McGowan has been indicted on a felony drug charge... | | Feedback welcome!
Email your likes, dislikes, thoughts to brian.stelter@turner.com... the feedback helps us improve this newsletter every day... Thank you! | | | | | | |
