July 12, 2020

Justice Dept. Moves to Block Merger Between AT&T and T-Mobile

The lawsuit sets up the most substantial antitrust battle since the election of President Obama, who campaigned with promises to revitalize the Justice Department’s policing of mergers and their effects on competition, which he said declined significantly under the Bush administration.

ATT said it would fight the lawsuit. “We plan to ask for an expedited hearing so the enormous benefits of this merger can be fully reviewed,” the company said in a statement. “The D.O.J. has the burden of proving alleged anti-competitive effects and we intend to vigorously contest this matter in court.”

ATT said it had no warning that the government was going to file to block the merger, because it has been actively involved in discussions with both the Justice Department and the Federal Communications Commission since the proposal was announced in March. ATT has indicated that it would consider some divestitures or other business actions to allow the deal to go forward.

But Justice Department officials said that those discussions led it to believe that it would difficult to arrange conditions under which the merger could proceed. “Unless this merger is blocked, competition and innovation will be reduced, and consumers will suffer,” said Sharis A. Pozen, acting assistant attorney general in charge of the Justice Department’s antitrust division.

The Justice Department has broad authority to influence proposed deals. On rare occasions, the agency takes the aggressive step of suing to block a deal altogether, as it is doing with ATT and did earlier this year with HR Block’s bid for the owner of TaxAct tax preparation software.

Sometimes just the threat of legal action is enough to stymie a deal, as in May when Nasdaq dropped its rival bid for the New York Stock Exchange’s parent company. In other cases, the Justice Department will remain silent, blessing a deal by default.

ATT’s promise to fight the suit could mean a potentially lengthy fight.

Consumer advocacy groups cheered the announcement. “This announcement is something for consumers to celebrate,” said Parul P. Desai, policy counsel for Consumers Union. “We have consistently warned that eliminating T-Mobile as a low-cost option will raise prices, lower choices and turn the cellular market into a duopoly controlled by ATT and Verizon.”

Harold Feld, legal director of Public Knowledge, a nonprofit group, said, “Fighting this job-killing merger is the best Labor Day present anyone can give the American people.” But labor groups had generally supported the merger, in part because a substantial number of ATT employees are members of the Communications Workers of America, while T-Mobile is a largely nonunion company.

Deputy Attorney General James M. Cole said the department decided that among those adversely affected would be wireless customers in rural areas and those with lower incomes. He said he also believed that an independent T-Mobile would be more likely to expand its business and add jobs, while mergers often result in the elimination of jobs.

The future of an independent T-Mobile is more of a question today, however, than before the merger with ATT was announced. Its parent company, Deutsche Telekom, has said it does not want to continue to invest in the American wireless market, preferring to focus on the growth of its telecommunications business in Europe.

Before ATT announced its intention to buy T-Mobile, there was consistent speculation in the wireless industry that a merger between T-Mobile and Sprint Nextel, the third-largest provider, was in the works. But such a deal looks unlikely in light of the arguments mustered by the Justice Department against the ATT deal.

Article source: http://feeds.nytimes.com/click.phdo?i=f3a08014e5ece300dda57f79cb31fa27

U.S. Moves to Block Merger Between AT&T and T-Mobile

The lawsuit sets up the most substantial antitrust battle since the election of President Obama, who campaigned with promises to revitalize the Justice Department’s policing of mergers and their effects on competition, which he said declined significantly under the Bush administration.

ATT said it would fight the lawsuit. “We plan to ask for an expedited hearing so the enormous benefits of this merger can be fully reviewed,” the company said in a statement. “The D.O.J. has the burden of proving alleged anti-competitive effects and we intend to vigorously contest this matter in court.”

ATT said it had no warning that the government was going to file to block the merger, because it has been actively involved in discussions with both the Justice Department and the Federal Communications Commission since the proposal was announced in March. ATT has indicated that it would consider some divestitures or other business actions to allow the deal to go forward.

But Justice Department officials said that those discussions led it to believe that it would difficult to arrange conditions under which the merger could proceed. “Unless this merger is blocked, competition and innovation will be reduced, and consumers will suffer,” said Sharis A. Pozen, acting assistant attorney general in charge of the Justice Department’s antitrust division.

The Justice Department has broad authority to influence proposed deals. On rare occasions, the agency takes the aggressive step of suing to block a deal altogether, as it is doing with ATT and did earlier this year with HR Block’s bid for the owner of TaxAct tax-preparation software.

Sometimes just the threat of legal action is enough to stymie a deal, as in May when Nasdaq dropped its rival bid for the New York Stock Exchange’s parent company. In other cases, the Justice Department will remain silent, blessing a deal by default.

ATT’s promise to fight the suit could mean a potentially lengthy fight.

Consumer advocacy groups cheered the announcement. “This announcement is something for consumers to celebrate,” said Parul P. Desai, policy counsel for Consumers Union. “We have consistently warned that eliminating T-Mobile as a low-cost option will raise prices, lower choices and turn the cellular market into a duopoly controlled by ATT and Verizon.”

Harold Feld, legal director of Public Knowledge, a nonprofit group, said that “fighting this job-killing merger is the best Labor Day present anyone can give the American people.” But labor groups had generally supported the merger, in part because a substantial number of ATT employees are members of the Communication Workers of America, while T-Mobile is a largely non-union company.

Deputy Attorney General James M. Cole said the department decided that among those adversely affected would be wireless customers in rural areas and those with lower incomes. He said he also believed that an independent T-Mobile would be more likely to expand its business and add jobs, while mergers often result in the elimination of jobs.

The future of an independent T-Mobile is more of a question today, however, than before the merger with ATT was announced. Its parent company, Deutsche Telekom, has said it does not want to continue to invest in the American wireless market, preferring to focus on the growth of its telecommunications business in Europe.

Before ATT announced its intention to buy T-Mobile, there was consistent speculation in the wireless industry that a merger between T-Mobile and Sprint Nextel, the third-largest provider, was in the works. But such a deal looks unlikely in light of the arguments mustered by the Justice Department against the ATT deal.

Article source: http://www.nytimes.com/2011/09/01/technology/us-moves-to-block-merger-between-att-and-t-mobile.html?partner=rss&emc=rss

16 Arrested as F.B.I. Hits the Hacking Group Anonymous

In an indictment unsealed Tuesday afternoon in United States District Court in San Jose, Calif., 14 people were charged in connection with an attack on the Web site of the payment service PayPal last December, after the company suspended accounts set up for donating funds to WikiLeaks. The suspects, in 10 separate states, are accused of conspiring to “intentionally damage protected computers.”

Anonymous had publicly called on its supporters to attack the sites of companies it said were turning against WikiLeaks, using tools that bombard sites with traffic and knock them offline.

A Florida man was also arrested and accused of breaching the Web site of Tampa InfraGard, an organization affiliated with the F.B.I., and then boasting of his actions on Twitter. And in New Jersey, a former contractor with ATT was arrested on charges that he lifted files from that company’s computer systems; the information was later distributed by LulzSec, a hacker collective that stemmed from Anonymous.

The PayPal attack came in response to the release by WikiLeaks last November of thousands of classified State Department cables. Members of Anonymous, a clique of worldwide hackers with a vague and ever-changing menu of grievances, have claimed responsibility for a number of attacks on government and corporate Web sites over the last eight months.

In recent weeks, police in Britain and the Netherlands have arrested several people suspected of having participated in those attacks. Justice Department officials said British and Dutch police also made related arrests on Tuesday. FoxNews.com reported Tuesday that the police in London had arrested a 16-year-old boy who they believed was a core member of LulzSec and used the alias Tflow.

The arrests of suspected Anonymous supporters in the United States were among the first known in this country.

Ross W. Nadel, a former federal prosecutor who founded the computer hacking and intellectual property unit at the Federal District Court in San Jose, said the arrests could be “a highly visible form of deterrence.”

The prosecution is expected to face at least two major challenges, said Jennifer Granick, a San Francisco-based lawyer who specializes in computer crimes and has defended hackers in the past. Because hackers often use aliases and other people’s computers when they carry out attacks, prosecutors will have to prove that those arrested “were the ones with their fingers on the keyboard,” she said.

Second, the conspiracy charge could be especially difficult to prove, given that Anonymous boasts of being leaderless and free-floating. “When you have a decentralized group,” Ms. Granick said, “the question is, Are there big fish, and are any of these people big fish?”

The charge of “intentional damage to a protected computer” is punishable by a maximum of 10 years in prison and a $250,000 fine, while conspiracy carries a maximum penalty of five years in prison and a $250,000 fine.

Cyberattacks are made possible by a combination of two features of the Internet economy. Poor security at many companies and agencies makes sensitive government and private data vulnerable to breaches. And mounting an attack is inexpensive and, with the right skills, relatively simple.

In the San Jose case, all 14 suspects are accused of using a free program called Low Orbit Ion Cannon to hurl large packets of data at PayPal’s site with the intention of overwhelming it.

With the exception of one suspect, whose name was redacted by the court for reasons that federal officials did not explain, those arrested were identified by their real names and nicknames, ranging from Anthrophobic to Toxic to MMMM. Most were in their 20s, and just three were above the age of 30. It is unclear if any of them knew one another.

Article source: http://feeds.nytimes.com/click.phdo?i=ef7a8d709849ca4067ec978652db46e1