United States et al v. Deutsche Telekom AG; T-Mobile US, Inc.; SoftBank Group Corp.; and Sprint Corp. Response to Public Comments
| Published date | 13 November 2019 |
| Citation | 84 FR 61640 |
| Record Number | 2019-24642 |
| Section | Notices |
| Court | Antitrust Division,Justice Department |
Federal Register, Volume 84 Issue 219 (Wednesday, November 13, 2019)
[Federal Register Volume 84, Number 219 (Wednesday, November 13, 2019)]
[Notices]
[Pages 61640-61657]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-24642]
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DEPARTMENT OF JUSTICE
Antitrust Division
United States et al v. Deutsche Telekom AG; T-Mobile US, Inc.;
SoftBank Group Corp.; and Sprint Corp. Response to Public Comments
Pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C.
16(b)-(h), the United States hereby publishes below the Response to
Public Comments on the Proposed Final Judgment in United States et al.
v. Deutsche Telekom AG; T-Mobile US, Inc.; SoftBank Group Corp.; and
Sprint Corp., Civil Action No. 1:19-cv-02232-TJK, which was filed in
the United States District Court for the District of Columbia on
November 6, 2019, together with copies of the 32 comments received by
the United States.
Pursuant to the Court's November 5, 2019 order, comments were
published electronically and are available to be viewed and downloaded
at the Antitrust Division's website, at: https://www.justice.gov/atr/us-and-plaintiff-states-v-deutsche-telekom-ag-et-al-index-comments. A
copy of the United States' response to the comments is also available
at the same location. Copies of the comments and the United States'
response are available for inspection at the Office of the Clerk of the
United States District Court for the District of Columbia. Copies of
these materials may also be obtained from the Antitrust Division upon
request and payment of the copying fee set by Department of Justice
regulations.
Amy R. Fitzpatrick,
Counsel to the Senior Director for Investigations and Litigation.
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
United States of America et al, Plaintiffs, v. Deutsche Telekom
AG et al, Defendants
Case No. 1:19-cv-02232-TJK
RESPONSE OF PLAINTIFF UNITED STATES TO PUBLIC COMMENTS ON THE PROPOSED
FINAL JUDGMENT
Table of Contents
Table of Contents
I. Introduction............................................. 1
II. Procedural History...................................... 3
III. Standard of Judicial Review............................ 4
IV. The Investigation and the Proposed Final Judgment....... 8
V. Summary of Public Comments and the United States' 15
Response...................................................
A. Comments that Fail To Acknowledge the Context of 16
Tunney Act Review......................................
B. Comments Regarding DISH's Viability as a Competitor.. 19
1. DISH's Assets and Track Record................... 19
2. DISH's Incentive and Ability To Compete.......... 25
C. Comments Regarding the Enforceability of the Proposed 31
Final Judgment.........................................
D. Other Comments Opposing Entry of the Proposed Final 37
Judgment...............................................
[[Page 61641]]
1. Comments Regarding Harms Outside the Scope of the 37
Complaint..........................................
2. Comments Regarding Services Provided to MVNOs.... 40
3. Comments Regarding Other Regulatory Matters...... 42
4. Other Negative Comments.......................... 44
E. Comments Regarding Procedural Aspects Of this Review. 45
1. Sufficiency of the Filings....................... 45
2. Comments Regarding the Timing of This Review..... 46
F. Comments Supporting Entry of the Proposed Final 48
Judgment...............................................
VI. Conclusion.............................................. 52
I. Introduction
As required by the Antitrust Procedures and Penalties Act (the
``APPA'' or ``Tunney Act''), 15 U.S.C. 16(b)-(h), the United States
hereby responds to the public comments received about the proposed
Final Judgment in this case regarding the proposed merger between T-
Mobile US, Inc. (``T-Mobile'') and Sprint Corporation (``Sprint''). For
the reasons set forth below, the remedy the United States obtained
addresses the competitive harm alleged in this action and is in the
public interest. Accordingly, the United States recommends no
modifications to the proposed Final Judgment.
This remedy, now adopted by the Attorneys General of eight states
who have joined this lawsuit \1\ and endorsed by two more through
comments in this proceeding, promises to expand output in the mobile
wireless market and be a boon for American consumers. The Federal
Communications Commission has concluded that the proposed transaction,
as modified by the FCC's own set of conditions, would be in the public
interest.\2\ In reaching this conclusion, the FCC recognized the
significant benefits that the proposed Final Judgment would yield.
Commenters in this proceeding recognize these benefits as well--the
United States received 32 comments regarding the settlement, the
majority of which were supportive of the merger and/or the proposed
Final Judgment.
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\1\ The Complaint filed on July 26, 2019 was joined by the
states of Kansas, Nebraska, Ohio, Oklahoma and South Dakota. Dkt.
No. 1. An Amended Complaint adding the state of Louisiana as a
plaintiff was entered on Aug. 16, 2019. Dkt. No. 28. The United
States' Consent Motions for Leave to Amend the Complaint to add the
states of Florida and Colorado as plaintiffs remain pending. Dkt.
Nos. 33, 40.
\2\ In the Matter of Applications of T-Mobile US, Inc., and
Sprint Corporation, et al., Memorandum Opinion and Order,
Declaratory Ruling, and Order of Proposed Modification, WT Docket
No. 18-197, FCC 19-103 (rel. Nov. 5, 2019) (``FCC Order'').
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The proposed Final Judgment provides for a substantial divestiture
which, when combined with the mobile wireless spectrum already owned by
DISH Network Corp. (``DISH''), will enable DISH to enter the market as
a new 5G mobile wireless services provider and a fourth nationwide
facilities-based wireless carrier. T-Mobile and Sprint must divest to
DISH Sprint's prepaid businesses, including more than 9 million Boost
Mobile, Virgin Mobile, and Sprint-branded prepaid subscribers, and make
available to DISH more than 400 employees currently running these
businesses. The proposed settlement also provides for the divestiture
of certain spectrum assets to DISH, and it requires T-Mobile and Sprint
to make available to DISH at least 20,000 cell sites and hundreds of
retail locations. T-Mobile must also provide DISH with robust access to
the T-Mobile network for a period of seven years while DISH builds out
its own 5G network.
The United States expects the proposed Final Judgment will provide
substantial long-term benefits for American consumers by ensuring that
large amounts of currently unused or underused spectrum are made
available to American consumers in the form of advanced 5G networks
that this proposed Final Judgment will help facilitate. Under
commitments made to the FCC that have been incorporated into the
proposed Final Judgment, DISH, which has been joined as a defendant in
this action, is required to bring its existing spectrum resources
online in a nationwide, greenfield 5G wireless network or risk
substantial penalties at the FCC and in this Court. Under T-Mobile's
commitments to the FCC, which are also incorporated into the proposed
Final Judgment, the merged firm will combine T-Mobile's and Sprint's
existing complementary spectrum resources and build out a 5G network to
deliver network capacity that exceeds the sum of what either carrier
could achieve on its own. Additionally, T-Mobile, Sprint, and DISH must
support remote SIM provisioning and eSIM technology, which have the
potential to lower barriers to entry and increase the options available
to consumers.
The proposed Final Judgment also includes several temporary
provisions to protect against a decline in near-term competition during
the transition period. To facilitate DISH's transition to an
independent wireless network, the proposed Final Judgment requires T-
Mobile and Sprint to enter into a full mobile virtual network operator
agreement (``Full MVNO Agreement'') with DISH at extremely favorable
terms. This agreement will enable DISH to operate as a Full MVNO,
initially using the T-Mobile network to carry its subscribers' traffic
and shifting this traffic to its own network facilities as it deploys
them. The unprecedented required divestitures and related obligations
in the proposed Final Judgment are intended to ensure that DISH can
begin to offer competitive services and become an independent and
vigorous competitor in the retail mobile wireless service market in
which the proposed merger would otherwise lessen competition. Finally,
the proposed Final Judgment requires that T-Mobile and Sprint extend
certain current Mobile Virtual Network Operator (``MVNO'') agreements
until the expiration of the Final Judgment, maintaining the status quo
until DISH's network becomes a potential option for MVNOs.
The comments that the United States received reflect a wide array
of views. After careful consideration of these comments, the United
States has determined that nothing in them casts doubt on its
conclusion that the public interest is well-served by the proposed
remedy. In accordance with the Court's order granting the Unopposed
Motion of the United States to Excuse Federal Register Publication of
Comments,\3\ the United States is publishing the comments and this
response on the Antitrust Division's website and is submitting to the
Federal Register this response and the website address at which the
comments may be viewed and downloaded. Following Federal Register
publication, the United States will move the Court to enter the
proposed Final Judgment.
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\3\ Minute Order, Dkt. No. 41 (Nov. 5, 2019) (granting motion to
excuse publication of the full text of each comment in the Federal
Register).
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[[Page 61642]]
II. Procedural History
On April 29, 2018, T-Mobile and Sprint, together with their parent
entities Deutsche Telekom AG (``Deutsche Telekom'') and SoftBank Group
Corp. (``SoftBank''), agreed to combine their respective businesses in
an all-stock transaction.\4\ On July 26, 2019, the United States filed
a civil antitrust Complaint seeking to enjoin the proposed transaction
because it would substantially lessen competition for retail mobile
wireless services in the United States, in violation of Section 7 of
the Clayton Act, 15 U.S.C. 18.
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\4\ Deutsche Telekom, T-Mobile, SoftBank, Sprint, and DISH are
referred to collectively as ``Defendants.''
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Simultaneously with the filing of the Complaint, the United States
filed a proposed Final Judgment and a Stipulation signed by the parties
that consents to entry of the proposed Final Judgment after compliance
with the requirements of the Tunney Act.\5\ The United States
subsequently filed a Competitive Impact Statement describing the
transaction and the proposed Final Judgment. The United States caused
the Complaint, the proposed Final Judgment, and Competitive Impact
Statement to be published in the Federal Register on August 12, 2019,
see 84 FR 39862 (Aug. 12, 2019), and caused notice regarding the same,
together with directions for the submission of written comments
relating to the proposed Final Judgment, to be published in The
Washington Post on August 3-9, 2019.\6\ The 60-day period for public
comment ended on October 11, 2019.
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\5\ See Stipulation and Order, Dkt. No. 2-1; Proposed Final
Judgment, Dkt. No. 2-2 (``PFJ'').
\6\ On Sept. 6, the United States filed a Notice of
Determinative Documents, as required by 15 U.S.C. 16(b), along with
an accompanying motion to file these documents with limited
redactions of confidential information. See Dkt. No. 31. This motion
remains pending. The redacted versions of these documents have been
available to the public since before the Competitive Impact
Statement was filed on July 30, 2019. Dkt. No. 20.
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III. Standard of Judicial Review
The Clayton Act, as amended by the APPA, requires that proposed
consent judgments in antitrust cases brought by the United States be
subject to a 60-day comment period, after which the Court shall
determine whether entry of the proposed final judgment ``is in the
public interest.'' 15 U.S.C. 16(e)(1). In making that determination,
the Court, in accordance with the statute as amended in 2004, is
required to consider:
(A) the competitive impact of such judgment, including
termination of alleged violations, provisions for enforcement and
modification, duration of relief sought, anticipated effects of
alternative remedies actually considered, whether its terms are
ambiguous, and any other competitive considerations bearing upon the
adequacy of such judgment that the court deems necessary to a
determination of whether the consent judgment is in the public
interest; and
(B) the impact of entry of such judgment upon competition in the
relevant market or markets, upon the public generally and
individuals alleging specific injury from the violations set forth
in the complaint including consideration of the public benefit, if
any, to be derived from a determination of the issues at trial.
15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory factors,
the Court's inquiry is necessarily a limited one as the government is
entitled to ``broad discretion to settle with the defendant within the
reaches of the public interest.'' United States v. Microsoft Corp., 56
F.3d 1448, 1461 (D.C. Cir. 1995); United States v. U.S. Airways Grp.,
Inc., 38 F. Supp. 3d 69, 75 (D.D.C. 2014) (explaining that the
``court's inquiry is limited'' in Tunney Act settlements); United
States v. InBev N.V./S.A., No. 08-1965 (JR), 2009 U.S. Dist. LEXIS
84787, at *3 (D.D.C. Aug. 11, 2009) (noting that a court's review of a
consent judgment is limited and only inquires ``into whether the
government's determination that the proposed remedies will cure the
antitrust violations alleged in the complaint was reasonable, and
whether the mechanism to enforce the final judgment are clear and
manageable'').
As the U.S. Court of Appeals for the District of Columbia Circuit
has held, under the APPA a court considers, among other things, the
relationship between the remedy secured and the specific allegations in
the government's complaint, whether the proposed final judgment is
sufficiently clear, whether its enforcement mechanisms are sufficient,
and whether it may positively harm third parties. See Microsoft, 56
F.3d at 1458-62. With respect to the adequacy of the relief secured by
the proposed final judgment, a court's role is ``not to make de novo
determination of facts and issues.'' United States v. W. Elec. Co., 993
F.2d 1572, 1577 (DC Cir. 1993) (quotation marks omitted); see also
Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 F.
Supp. 2d 37, 40 (D.D.C. 2001); United States v. Enova Corp., 107 F.
Supp. 2d 10, 16 (D.D.C. 2000); InBev, 2009 U.S. Dist. LEXIS 84787, at
*3. Instead, ``[t]he balancing of competing social and political
interests affected by a proposed antitrust consent decree must be left,
in the first instance, to the discretion of the Attorney General.'' W.
Elec. Co., 993 F.2d at 1577 (quotation marks omitted). ``The court
should bear in mind the flexibility of the public interest inquiry: The
court's function is not to determine whether the resulting array of
rights and liabilities is one that will best serve society, but only to
confirm that the resulting settlement is within the reaches of the
public interest.'' Microsoft, 56 F.3d at 1460 (quotation marks
omitted). More demanding requirements would ``have enormous practical
consequences for the government's ability to negotiate future
settlements,'' contrary to congressional intent. Id. at 1456. ``The
Tunney Act was not intended to create a disincentive to the use of the
consent decree.'' Id.
The United States' predictions about the efficacy of the remedy are
to be afforded deference by the Court. See, e.g., Microsoft, 56 F.3d at
1461 (recognizing courts should give ``due respect to the Justice
Department's . . . view of the nature of its case''); United States v.
Iron Mountain, Inc., 217 F. Supp. 3d 146, 152-53 (D.D.C. 2016) (``In
evaluating objections to settlement agreements under the Tunney Act, a
court must be mindful that [t]he government need not prove that the
settlements will perfectly remedy the alleged antitrust harms[;] it
need only provide a factual basis for concluding that the settlements
are reasonably adequate remedies for the alleged harms.'') (internal
citations omitted); United States v. Republic Servs., Inc., 723 F.
Supp. 2d 157, 160 (D.D.C. 2010) (noting ``the deferential review to
which the government's proposed remedy is accorded''); United States v.
Archer-Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (``A
district court must accord due respect to the government's prediction
as to the effect of proposed remedies, its perception of the market
structure, and its view of the nature of the case''). The ultimate
question is whether ``the remedies [obtained by the Final Judgment are]
so inconsonant with the allegations charged as to fall outside of the
`reaches of the public interest.' '' Microsoft, 56 F.3d at 1461
(quoting W. Elec. Co., 900 F.2d at 309).
Moreover, Congress limited the court's role under the APPA to
reviewing the remedy in relationship to the violations that the United
States has alleged in its complaint, and did not authorize the court to
``construct [its] own hypothetical case and then evaluate the decree
against that case.'' Microsoft, 56 F.3d at 1459; see also U.S. Airways,
38 F. Supp. 3d at 75 (noting that the court must simply determine
whether there is a factual foundation for the government's decisions
such that its conclusions regarding the proposed
[[Page 61643]]
settlements are reasonable); InBev, 2009 U.S. Dist. LEXIS 84787, at *20
(``the `public interest' is not to be measured by comparing the
violations alleged in the complaint against those the court believes
could have, or even should have, been alleged''). Because the ``court's
authority to review the decree depends entirely on the government's
exercising its prosecutorial discretion by bringing a case in the first
place,'' it follows that ``the court is only authorized to review the
decree itself,'' and not ``effectively [to] redraft the complaint'' to
inquire into other matters that the United States did not pursue.
Microsoft, 56 F.3d at 1459-60.
In its 2004 amendments to the APPA, Congress made clear its intent
to preserve the practical benefits of using consent judgments in
antitrust enforcement, Pub. L. 108-237 Sec. 221, and added the
unambiguous instruction that ``[n]othing in this section shall be
construed to require the court to conduct an evidentiary hearing or to
require the court to permit anyone to intervene.'' 15 U.S.C. 16(e)(2);
see also U.S. Airways, 38 F. Supp. 3d at 76 (indicating that a court is
not required to hold an evidentiary hearing or to permit intervenors as
part of its review under the Tunney Act). This language explicitly
wrote into the statute what Congress intended when it first enacted the
Tunney Act in 1974. As Senator Tunney explained: ``[t]he court is
nowhere compelled to go to trial or to engage in extended proceedings
which might have the effect of vitiating the benefits of prompt and
less costly settlement through the consent decree process.'' 119 Cong.
Rec. 24,598 (1973) (statement of Sen. Tunney). Courts can, and do, make
Tunney Act determinations based solely on the competitive impact
statement, comments filed by the public, and the United States'
response thereto, even when there is opposition to the proposed remedy.
A recent example is United States v. Bayer AG, in which the court
entered the proposed Final Judgment without further factfinding despite
opposition from a number of commenters, including several of the states
now involved in the lawsuit seeking to enjoin the T-Mobile/Sprint
transaction in the U.S. District Court for the Southern District of New
York (``S.D.N.Y. Litigation''). See Order, United States v. Bayer AG,
No. 18-1241 (D.D.C. Feb. 8, 2019); see also United States v. US
Airways, 38 F. Supp. 3d 69, 76 (D.D.C. 2014) (entering proposed Final
Judgment over the opposition of commenters and explaining that ``[a]
court can make its public interest determination based on the
competitive impact statement and response to public comments alone.'')
(citing Enova, 107 F. Supp. 2d at 17).
IV. The Investigation and the Proposed Final Judgment
The proposed Final Judgment is the culmination of a comprehensive,
fifteen-month investigation conducted by the Antitrust Division of the
U.S. Department of Justice into T-Mobile's proposed acquisition of
Sprint. The proposed Final Judgment addresses and ameliorates the harms
alleged in the Complaint by enabling DISH's entry as a fourth
nationwide facilities-based wireless competitor, expediting deployment
of advanced 5G networks for American consumers, and providing other
relief. The proposed Final Judgment has several components, by which
the parties agreed to abide during the pendency of the Tunney Act
proceeding, and which the Court ordered in the Stipulation and Order of
July 29, 2019, Dkt. No. 16.
Divestiture of Sprint's Prepaid Businesses: Under the proposed
Final Judgment, T-Mobile must divest to DISH Sprint's prepaid retail
wireless service businesses and provide DISH an exclusive option to
acquire cell sites and retail stores decommissioned by the merged firm.
Prepaid Assets. The proposed Final Judgment requires T-
Mobile to divest to DISH almost all of Sprint's prepaid wireless
businesses,\7\ including the Boost-branded, the Virgin-branded, and the
Sprint-branded businesses. These Prepaid Assets, coupled with required
network support from T-Mobile described more fully below, will provide
an existing business, with assets including customers, employees, and
intellectual property, that will enable DISH to offer retail mobile
wireless service. Acquiring this existing business will enhance DISH's
incentives to invest in a robust facilities-based network.
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\7\ The divestiture does not include subscribers that Virgin
Mobile serves under the Assurance Wireless brand as part of the
federally subsidized Lifeline program administered by the FCC. The
baseline Assurance Wireless plan, which includes unlimited voice and
text and a fixed allotment of data, is free to qualifying
subscribers. Virgin Mobile receives a subsidy from the FCC for each
of these subscribers that it serves. Subscribers may also purchase
additional data for a fee. Because Virgin Mobile's revenue for
Assurance Wireless subscribers comes primarily from federal
subsidies rather than user fees, this segment of the market does not
raise the same competitive issues as the unsubsidized prepaid
segment. Moreover, T-Mobile has publicly committed to maintaining
the Assurance Wireless service indefinitely, barring material
changes to the Lifeline program. See Letter from T-Mobile CEO John
Legere to Rep. Tony Cardenas (Mar. 6, 2019), available at https://cardenas.house.gov/sites/cardenas.house.gov/files/3-6-19%20T-MOBILE%20RESPONSE%20%20Final%20Cardenas%20Response%20030619%200908%20am%20est_Executed%20%28002%29%281%29.pdf. The settlement is not
affected by recent news reports concerning Sprint's compliance with
the Lifeline program's requirements because the Lifeline customers
are not included in the divestiture. The divestitures also do not
include Sprint's prepaid customers receiving services through its
Swiftel and Shentel affiliates, due to contractual obligations.
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800 MHz Spectrum Licenses. The proposed Final Judgment
further requires T-Mobile to divest to DISH Sprint's 800 MHz spectrum
licenses. This spectrum would add to DISH's existing spectrum assets in
order to ensure DISH has sufficient spectrum to provide mobile wireless
service to customers.\8\
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\8\ DISH may, at its option, elect not to acquire the spectrum
if DISH can meet certain network buildout and service requirements
without it. See infra at 23. In such case, T-Mobile will auction the
800 MHz spectrum licenses to any person who is not already a
national facilities-based wireless carrier.
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Cell Sites and Retail Stores. The proposed Final Judgment
also requires T-Mobile to provide to DISH an exclusive option to
acquire all cell sites and retail store locations being decommissioned
by the merged firm. This requirement will enable DISH to utilize such
existing cell sites and retail stores that are useful to DISH in
building out its own wireless network and providing mobile wireless
service to consumers.
Transition Services. At DISH's option, T-Mobile and Sprint
shall enter into one or more transition services agreements to provide
billing, customer care, SIM card procurement, device provisioning, and
all other services used by the Prepaid Assets prior to the date of
their transfer to DISH for an initial period of up to two years after
transfer. Such transition services will enable DISH to use the Prepaid
Assets as quickly as possible and will help prevent disruption for
Boost, Virgin, and Sprint prepaid customers as the businesses are
transferred to DISH.
The divestiture of Sprint's prepaid businesses must be completed in
such a way as to satisfy the United States in its sole discretion that
it can and will be operated by DISH as a viable, ongoing business that
can compete effectively in the retail mobile wireless service market.
DISH is required to offer retail mobile wireless services, including
offering nationwide postpaid retail mobile wireless service within one
year of the closing of the sale of the Prepaid Assets.\9\ As set forth
in the Stipulation
[[Page 61644]]
and Order, DISH has agreed to be joined to this action for purposes of
the divestiture. Including DISH is appropriate because the United
States has determined that DISH is a necessary party to effectuate the
relief obtained; the divestiture package was crafted specifically
taking into consideration DISH's existing assets and capabilities, and
divesting the package to another purchaser would not preserve
competition. Thus, as discussed above, the proposed Final Judgment
imposes certain obligations on DISH to ensure that the divestitures
take place expeditiously and that DISH meet certain deadlines in
building out and operating its own mobile wireless services network to
provide competitive retail mobile wireless service.
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\9\ To ensure that DISH and T-Mobile remain independent
competitors, Section XV of the proposed Final Judgment prohibits T-
Mobile from reacquiring from DISH any part of the Divestiture
Assets, other than a limited carveout for T-Mobile to lease back a
small amount of spectrum for a two-year period. Further, Section XV
of the proposed Final Judgment prohibits DISH from selling, leasing,
or otherwise providing the right to use the Divestiture Assets to
any national facilities-based mobile wireless carrier. These
provisions ensure that T-Mobile and DISH cannot undermine the
purpose of the proposed Final Judgment by later entering into a new
transaction, with each other or with another competitor, that would
reduce the competition that the divestitures have preserved.
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Full MVNO Agreement: The proposed Final Judgment requires T-Mobile
and Sprint to enter into a Full MVNO Agreement with DISH for a term of
no fewer than seven years. Under the agreement outlined in the proposed
Final Judgment, T-Mobile and Sprint must permit DISH to operate as an
MVNO on the merged firm's network on commercially reasonable terms that
are approved by the Department of Justice and to resell the merged
firm's mobile wireless service. As DISH deploys its own mobile wireless
network, T-Mobile and Sprint must also facilitate DISH operating as a
Full MVNO by providing the necessary network assets, access, and
services. These requirements will enable DISH to begin operating as an
MVNO as quickly as possible after entry of the Final Judgment, and
provide DISH the support it needs to offer retail mobile wireless
service to consumers while building out its own mobile wireless
network.\10\ They will also permit DISH to begin to market itself as a
national retail mobile wireless provider immediately after the
divestiture closes.
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\10\ To guard against the possibility that implementation and
execution of the proposed Final Judgment and any associated
agreements between T-Mobile and DISH could facilitate coordination
or other anticompetitive behavior during the interim period before
DISH becomes fully independent of T-Mobile, T-Mobile and DISH are
required to implement firewall procedures to prevent each company's
confidential business information from being used by the other for
any purpose that could harm competition. T-Mobile and DISH submitted
their respective firewall procedures to the United States on Sept.
10, 2019.
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Notably, T-Mobile will provide DISH with a broader array of rights
under the Full MVNO Agreement than wholesale providers generally grant
to their partners in traditional MVNO agreements. This will benefit
competition and American consumers. In particular, traditional MVNO
agreements generally do not permit the MVNO partner to construct its
own network facilities and carry a portion of its traffic on these
facilities while relying on the wholesale provider to carry the
remainder of the MVNO's traffic. The Full MVNO Agreement will provide
DISH with this ability. In addition, unlike traditional MVNO
agreements, full MVNO agreements grant the MVNO control over a broader
range of technological components, which allow the MVNO to manage the
customer relationship more directly.\11\ By providing these
capabilities, full MVNO agreements promise to enable more robust
competition than traditional MVNO agreements have in the past.\12\ The
Full MVNO Agreement in this case will allow DISH to begin competing
with the other carriers in short order and will facilitate DISH's
transition into a full, facilities-based mobile wireless service
provider.\13\
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\11\ Full MVNO agreements have been used to enable entry in
wireless markets outside of the United States as well. See European
Commission, DG Competition, Case M.7758-Hutchinson 3D Italy/Wind/JV
Sec. 5.2.4 (Jan. 1, 2016) (``So-called `full MVNOs' typically do
not have radio network access or spectrum, but own some of the core
infrastructure, issue their own SIM cards, have network codes, a
database of customers and back-office functions to manage customer
relations.''), available at https://ec.europa.eu/competition/mergers/cases/decisions/m7758_2937_3.pdf.
\12\ For example, cable provider Altice has launched a wireless
service based on an infrastructure-based MVNO agreement that it
plans to leverage to compete with facilities-based carriers across a
variety of geographic areas. See Letter to Marlene H. Dortch (FCC)
from Jennifer L. Richter, WT Docket No. 18-197 (June 6, 2019)
(``Altice's model to enter the U.S. wireless market by investing in
wireless core infrastructure and utilizing a full infrastructure
mobile virtual network operator (`MVNO') will position Altice to
provide true competition in the retail markets, providing
significant benefits for consumers in Altice's diverse markets, from
the urban centers in New York and New Jersey to the rural
communities in West Virginia and Texas.''), available at https://ecfsapi.fcc.gov/file/10607282312243/Altice%20USA%20Inc.%20-%20Ex%20Parte%206.4.19%20Meetings.pdf.
\13\ Given the difference between traditional MVNO agreements
and Full MVNO agreements like the one at issue here, comparisons
between DISH and traditional MVNOs that have failed in the past are
inapposite. See, e.g., RWA Comment (Exhibit 24) at 6. Similarly, CWA
is incorrect in suggesting that there is a ``mismatch'' between the
Complaint and the remedy. CWA Comment (Exhibit 10) at 1. The
Complaint alleges that the competitive constraint imposed by
traditional MVNOs is limited, while the remedy will allow DISH to
enter as a Full MVNO and ultimately transition into a facilities-
based carrier. See also FCC Order ] 205 (finding that ``generalized
references to prior Commission decisions regarding the competitive
significance of MVNOs fail to account for the unique aspects of the
wholesale agreement required by the Boost Divestiture Conditions'').
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Facilities-Based Entry and Expansion: The proposed Final Judgment
requires T-Mobile and Sprint to comply with all network build
commitments made to the Federal Communications Commission (FCC) \14\
related to their merger or the divestiture to DISH as of the date of
entry of the Final Judgment, subject to verification by the FCC.\15\
The FCC concluded that the transaction, as modified by these
commitments, would ``result in a number of benefits,'' including ``the
deployment of a highly robust nationwide 5G network'' and
``substantially increased coverage and capacity (and in turn, user
speeds and cost structure) compared to the standalone companies.'' \16\
The FCC's order contains a comprehensive Technical Appendix detailing
the benefits of T-Mobile's post-merger network plan.\17\ The commenters
in this proceeding generally do not attempt to criticize T-Mobile's
network build commitments or the associated benefits they are expected
to bring to consumers.
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\14\ The FCC conducted its own independent review of this
transaction and concluded that the transfer of licenses from Sprint
to T-Mobile is in the public interest. See FCC Order ] 4. As part of
its review, the FCC accepted T-Mobile's voluntary commitments on
various elements of its post-merger plans, including with respect to
the post-merger buildout of its 5G network. Id. ]] 25-32. In
accepting T-Mobile's voluntary commitments in its order, the FCC has
transformed them into legally binding commitments. Id. ] 388.
\15\ See Letter to Marlene H. Dortch (FCC) from Nancy J. Victory
and Regina M. Keeney (Counsel for T-Mobile and Sprint,
respectively), WT Docket No. 18-197, Attachment 1 (May 20, 2019),
available at https://www.fcc.gov/sites/default/files/t-mobile-us-sprint-letter-05202019.pdf.
\16\ FCC Order ] 236.
\17\ Id. Technical App'x ]] 31-42 (explaining complementarities
between the two firms' spectrum holdings, potential efficiencies
regarding cell site equipment deployment, and the merger's benefits
to network capacity).
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In turn, DISH is required to comply with the June 14, 2023 AWS-4,
700 MHz, H Block, and Nationwide 5G Broadband network build commitments
made to the FCC on July 26, 2019, subject to verification by the
FCC.\18\ The FCC concluded that modifying DISH's spectrum licenses to
include these commitments would be in the public interest and has
directed its Wireless Telecommunications Bureau to do so once the
divestiture of Boost has been
[[Page 61645]]
consummated.\19\ Incorporating these obligations into the proposed
Final Judgment is intended to increase the incentives for the merged
firm to achieve the promised efficiencies from the merger and for DISH
to build out its own national facilities-based mobile wireless network
to replace the competition lost as a result of Sprint being acquired by
T-Mobile. Increasing DISH's incentives to complete the buildout of a
fourth standalone 5G nationwide wireless network also serves to
decrease the likelihood of anticompetitive coordinated effects that may
arise out of the merger.\20\
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\18\ See Letter to Donald Stockdale (FCC) from Jeffrey H. Blum
(DISH), Attachment A (July 26, 2019) (``Blum July 26, 2019
Letter''), available at https://www.fcc.gov/sites/default/files/dish-letter-07262019.pdf.
\19\ FCC Order ] 365.
\20\ See Complaint ] 5 (alleging that, absent the remedy, ``the
merger likely would make it easier for the three remaining national
facilities-based mobile wireless carriers to coordinate their
pricing, promotions, and service offerings''); see also id. ]] 21-
22. Notably, the FCC ``d[id] not conclude that the likelihood of
coordination would increase post-transaction.'' See FCC Order ] 186.
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600 MHz Spectrum Deployment: The proposed Final Judgment requires
DISH and T-Mobile to enter into good-faith negotiations to allow T-
Mobile to lease some or all of DISH's 600 MHz spectrum for use in
offering mobile wireless services to its subscribers. Such an agreement
is expected to expand output by making the 600 MHz spectrum available
for use by consumers even before DISH has completed building out its
network, and would assist T-Mobile in transitioning consumers to its 5G
network.
MVNO Requirements: The proposed Final Judgment obligates T-Mobile
and Sprint to extend all of their current MVNO agreements until the
expiration of the proposed Final Judgment. This obligation will ensure
that T-Mobile's and Sprint's MVNO partners remain options for the
consumers who currently use them. This will also permit T-Mobile's and
Sprint's MVNO partners to retain the benefits of their existing
agreements until the expiration of the proposed Final Judgment, by
which time DISH is expected to have become an additional provider of
wireless services.
T-Mobile's and DISH's eSIM Obligations: The proposed Final Judgment
requires T-Mobile and DISH to support eSIM technology and prohibits T-
Mobile and DISH from discriminating against devices based on their use
of remote SIM provisioning or use of eSIM technology. The more
widespread use of eSIMs and remote SIM provisioning may help DISH
attract consumers as it launches its mobile wireless business. These
provisions are intended to increase the disruptiveness of DISH's entry
by making it easier for consumers to switch between wireless carriers
(particularly between the merged firm and DISH) and to choose a
provider that does not have a nearby physical retail location, thus
lowering the cost of DISH's entry and expansion.\21\
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\21\ The FCC has recognized the benefits of eSIM technology and
the potential for this condition to promote competition among mobile
wireless service providers. See id. ] 206 (``[R]equirements related
to the use of eSIM will tend to lower switching costs for wireless
consumers, increasing the ability of Boost to win subscribers from
T-Mobile and, in turn, Boost's ability to constrain pricing for T-
Mobile's brands.'').
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V. Summary of Public Comments and the United States' Response
The United States received 32 comments from different categories of
commenters, the majority of which were supportive of the merger and/or
the proposed final judgment. The commenters include: The Advanced
Communication Law & Policy Institute; the American Antitrust Institute;
Americans for Tax Reform; the Asian Business Association; Attorneys
General for the States of Utah and Arkansas; Mr. Daniel M. Bellemare;
the CalAsian Chamber of Commerce; the California Emerging Technology
Fund; the Center for Individual Freedom; the Communications Workers of
America; the Competitive Enterprise Institute; Economics Professors
(Nicholas Economides, John Kwoka, Thomas Philipon, Robert Seamans, Hal
Singer, Marshall Steinbaum, and Lawrence J. White); the Enterprise
Wireless Alliance; the Greater Kansas Chamber of Commerce; Mr. Edward
S. Hasten; the International Center for Law & Economics; the National
Diversity Coalition; the National Hispanic Caucus of State Legislators;
the National Puerto Rican Chamber of Commerce; NTCH, Inc.; the Overland
Park Chamber of Commerce; a coalition of advocacy groups (Public
Knowledge, Consumer Reports, Electronic Frontier Foundation, and New
America's Open Technology Institute); Randolph May and Seth Cooper of
the Free State Foundation; the Rural Wireless Association; Scott
Wallsten of the Technology Policy Institute; Tech Freedom; Members of
the United States House of Representatives (Representatives Anna G.
Eshoo, Billy Long, Adam Smith, Doug Lamborn, Gregory W. Meeks, Roger W.
Marshall, Suzan DelBene, Dan Newhouse, Anthony G. Brown, Ron Estes,
Mike Thompson, Blaine Luetkemeyer, and Kurt Schrader); Vermont
Telephone Co.; Viaero Wireless; Voqal, Inc.; Mr. R. Bruce Williamson;
and Mr. Josh Wool.
The comments can be grouped into categories: (1) Comments that fail
to acknowledge the context of this Court's Tunney Act review; (2)
comments regarding DISH's viability as a competitor; (3) comments
regarding the enforceability of the proposed Final Judgment; (4) other
comments opposing entry of the proposed Final Judgment; (5) comments
regarding procedural aspects of this review; and (6) other comments
supporting entry of the proposed Final Judgment.
A. Comments That Fail To Acknowledge the Context of Tunney Act Review
A number of comments do not actually address the question presented
to this Court, which is whether or not entry of the United States'
proposed Final Judgment remedy is in the public interest under the
Tunney Act. If these commenters acknowledge the Tunney Act at all, they
make arguments that do not consider the governing legal standards
discussed above, or the fact that the allegations in the United States'
complaint have not been tested in any court. Nor do they acknowledge
the benefits to the public from the merger itself. Several commenters
presuppose that the standard relevant here is the same standard
governing how a court is to fashion a remedy after an antitrust
violation has been proven in court.\22\ As discussed above, however,
this is not the standard Congress and case law prescribe for courts
reviewing settlements under the Tunney Act. Instead, courts recognize
that a proposed final judgment necessarily represents a compromise
between the parties, and give deference to the United States' views of
the likely effects of the settlement.
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\22\ See CWA Comment (Exhibit 10) at 6 and n.10 (quoting a
statement in the Antitrust Division's remedies guide that ``The
relief in an antitrust case must be `effective to redress the
violations,' '' which quotes Ford Motor Co. v. United States, 405
U.S. 562, 573 (1972), a case addressing post-trial relief) (emphasis
added); Economics Professors Comment (Exhibit 12) at 2 (referring to
``restor[ing] ``the ex ante competitive conditions in the affected
antitrust product markets.'').
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Entry of the proposed Final Judgment here is fully in keeping with
established Tunney Act standards. In United States v. US Airways, Judge
Kollar-Kotelly entered the proposed Final Judgment in the merger of
U.S. Airways and American Airlines over the objections of commenters.
While noting that the ``the Final Judgment does not create a new
independent competitor nor replicate American's capacity expansion
plans nor affirmatively preserve the Advantage Fares program,'' the
court credited the United States' ``predict[ion] that it will impede
the airline industry's
[[Page 61646]]
evolution toward a tighter oligopoly.'' \23\ By reducing slot
concentration at Reagan National, the settlement provided low-cost
carriers (``LCCs'') ``with substantial assets at key airports,'' and
the Court credited the United States' prediction that ``providing LCCs
with these otherwise unavailable opportunities will create incentives
for LCCs to invest in new capacity, expand into new markets, and
provide more meaningful system-wide competition to the three remaining
legacy airlines.'' \24\ Ultimately, the Court found that the ``United
States has provided a reasonable basis for concluding that the
settlement will mitigate the anticompetitive effects of combining two
of the remaining legacy airlines.'' \25\
---------------------------------------------------------------------------
\23\ US Airways, 38 F. Supp. 3d at 77.
\24\ Id. at 78.
\25\ Id. at 79.
---------------------------------------------------------------------------
In United States v. Bayer AG, Judge Boasberg entered the proposed
Final Judgment, over commenters' criticisms similar to those here.\26\
Additionally, in United States v. Abitibi-Consolidated, Inc., Judge
Collyer entered the proposed Final Judgment where the ``United States
has provided a factual basis for concluding that the . . . divestiture
was reasonably adequate.'' \27\ ``Irrespective of whether that
conclusion [was] correct,'' the court recognized that the ``United
States has established an `ample foundation for [its] judgment call'
and thus shown `its conclusion [was] reasonable.' '' \28\
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\26\ In Bayer, as here, commenters questioned both the ability
of the divestiture buyer, BASF, ``to succeed with the divested
assets'' and its ``incentives to compete aggressively against the
merged company.'' See Response of the United States to Public
Comments on the Proposed Final Judgment at 14, United States v.
Bayer AG, No. 1:18-cv-1241 (JEB) (D.D.C. Jan. 29, 2019). There, as
here, the United States ``carefully considered these issues in
crafting the proposed remedy'' and required the merged company to
make an appropriate divestiture and to provide an array of
transitional services, all while ``specifically taking into account
[the divestiture buyer's] existing assets and capabilities.'' Id.
And while there, as here, it was ``impossible to predict with
certainty how well [the buyer, BASF] will perform with the divested
assets (just as [the merged firm's] own performance with those
assets absent the merger is not certain),'' the proposed remedy
``ensure[d]'' that it ``will be as well-positioned as possible and
have the necessary incentives'' to ``replace the competition that
otherwise would be lost through the merger.'' Id.
\27\ United States v. Abitibi-Consolidated, Inc., 584 F. Supp.
2d 162, 166 (D.D.C. 2008).
\28\ Id. (quoting Microsoft, 56 F.3d at 1461).
---------------------------------------------------------------------------
Almost all the comments opposing the proposed Final Judgment also
ignore the benefits to the public from this merger.\29\ For example,
the Economics Professors attempt to dismiss the value of increasing
capacity by arguing that the merger will not result in reductions in
marginal cost. Specifically, they state that ``the merger purportedly
will increase capacity . . . [but] there is no explanation of how a
purported increase in capacity reduces the merged firm's marginal cost
of serving the next customer or the next neighborhood.'' \30\ In fact,
the relationship between an increase in capacity and a reduction in
marginal cost is a well-understood economic phenomenon in industries
with capacity constraints. In the market for mobile wireless services,
the marginal cost of an additional customer on a capacity-constrained
network includes the costs of the congestion caused by adding that
customer to the network. Thus, a merger-induced expansion of capacity
would result in a reduction in marginal costs for a network facing
congestion.\31\
---------------------------------------------------------------------------
\29\ See U.S. Department of Justice, Antitrust Division Policy
Guide to Merger Remedies, at 2 (Oct. 2004), https://www.justice.gov/sites/default/files/atr/legacy/2011/06/16/205108.pdf (``2004
Remedies Guide'') (``Effective remedies preserve the efficiencies
created by a merger, to the extent possible, without compromising
the benefits that result from maintaining competitive markets.'').
\30\ Economics Professors Comment (Exhibit 12) at 6.
\31\ Notably, the FCC found that ``New T-Mobile will have
significantly lower marginal costs for providing advanced wireless
services.'' FCC Order ] 236.
---------------------------------------------------------------------------
Other commenters, however, recognize the substantial benefits that
the proposed Final Judgment promises to bring. The Advanced
Communications Law & Policy Institute (ACLP) at New York Law School
states that it supports entry of the proposed Final Judgment because it
believes the public interest benefits from the merger ``are
substantial,'' and because the settlement ``will ensure that valuable
spectrum resources will finally be put to productive use by Dish
Network, an entity that has long lingered on the periphery of the U.S.
wireless space.'' \32\ In ACLP's view, DISH is ``well positioned to
become a viable player'' in wireless, not only because of its existing
``treasure trove'' of spectrum licenses, but also because the proposed
Final Judgment will enable DISH to ``leverage numerous resources either
divested by or leased from the merging parties to support deployment of
a standalone mobile service.'' \33\ ACLP further notes that, in
addition to the fact that DISH ``finally leveraging its stockpile of
spectrum licenses . . . is a major win for consumers and the public
interest writ large,'' consumers also will ``likely see additional
price and service offerings over the next few years as [DISH] rolls out
its service and seeks to respond to and one-up its competitors.'' \34\
---------------------------------------------------------------------------
\32\ ACLP Comment (Exhibit 1) at 4.
\33\ Id. at 6.
\34\ Id.
---------------------------------------------------------------------------
B. Comments Regarding DISH's Viability as a Competitor
Several commenters object to the proposed Final Judgment on the
basis that DISH will not be a sufficiently strong competitor to AT&T,
Verizon, and T-Mobile. These commenters point to DISH's asset base and
track record to support their claim that the company will lack the
incentive and ability to compete vigorously in the mobile wireless
market. The United States disagrees with these assertions.
1. DISH's Assets and Track Record
Some commenters take issue with the fact that DISH has been
acquiring spectrum for a number of years but has not yet deployed a
network that operates over that spectrum. For example, the CWA and
Economics Professors accuse DISH of ``warehousing'' spectrum and claim
that DISH has missed FCC network buildout deadlines.\35\ Mr. Wool asks,
``given DISH Network's failure to meet prior Federal Communications
Commission (FCC) build-out requirements on its existing spectrum . . .
how is the proposed Final Judgment consistent with `a low risk
tolerance'?'' \36\ Several commenters point to T-Mobile's past
criticism of DISH as a basis for questioning DISH's viability as a
competitor.\37\
---------------------------------------------------------------------------
\35\ CWA Comment (Exhibit 10) at 16-18; Economics Professors
Comment (Exhibit 12) at 9.
\36\ Wool Comment (Exhibit 32) at 3.
\37\ See, e.g., CWA Comment (Exhibit 10) at 16; Economics
Professors Comment (Exhibit 12) at 9; NTCH Comment (Exhibit 20) at
9-11.
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Far from undermining the efficacy of the proposed Final Judgment,
DISH's spectrum assets make it a prime candidate for entry into the
mobile wireless market. DISH has invested more than $20 billion in
spectrum licenses.\38\ As a result, DISH currently has far more
spectrum at its disposal than any other company aside from the existing
nationwide wireless carriers.\39\
[[Page 61647]]
The Division's 2004 Remedies Guide notes that ``[t]he circumstances of
potential bidders may vary in ways that affect the scope of the assets
each would need to compete quickly and effectively.'' \40\ DISH's
spectrum assets provide it with the ability to compete more quickly and
more effectively than another entrant could. The proposed Final
Judgment promises to put this spectrum to use for the benefit of
consumers.\41\
---------------------------------------------------------------------------
\38\ ``DISH to Become National Facilities-Based Wireless
Carrier'' (July 26, 2019), http://about.dish.com/2019-07-26-DISH-to-Become-National-Facilities-based-Wireless-Carrier (``DISH July 26,
2019 Press Release'') (``These developments are the fulfillment of
more than two decades' worth of work and more than $21 billion in
spectrum investments intended to transform DISH into a connectivity
company''); see also Todd Shields & Scott Moritz, Bloomberg, ``A $20
Billion Wireless Stockpile Is the Key to T-Mobile Merger'' (July 6,
2019), https://www.bloomberg.com/news/articles/2019-07-06/a-20-billion-wireless-stockpile-is-the-key-to-t-mobile-merger.
\39\ FCC Communications Marketplace Report, 33 FCC Rcd 12558,
12587 Fig. A-25 (Dec. 26, 2018), available at https://docs.fcc.gov/public/attachments/FCC-18-1181A1_Rcd.pdf.
\40\ 2004 Remedies Guide at 11.
\41\ See ACLP Comment (Exhibit 1) at 6.
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These commenters' line of argument also fails to address what
incentive DISH could have to acquire $20 billion in spectrum licenses
and spend billions of dollars on the divestiture in this matter and
risk billions more in fines, only to sit on these assets. The more
logical inference, which aligns with DISH's economic incentives, is
that DISH will deploy its spectrum and enter the mobile wireless
market. DISH has explained to the FCC that the company has engaged in
efforts to develop technology that operates over its spectrum but that
it opted not to construct a 4G/LTE network at a time when 5G technology
was on the horizon.\42\ Now that mobile wireless providers are
beginning to deploy 5G, DISH has issued three wide-ranging requests for
information/requests for production to vendors of wireless equipment,
software, and services to begin the process of sourcing inputs for the
construction of a 5G network.\43\
---------------------------------------------------------------------------
\42\ See DBSD Services Limited, Gamma Acquisition L.L.C., and
Manifest Wireless L.L.C.'s Consolidated Interim Construction
Notification for AWS-4 and Lower 700 MHz E Block Licenses (filed
Mar. 7, 2017) (``DISH March 7, 2017 Buildout Report''), available at
https://wireless2.fcc.gov/UlsEntry/attachments/attachmentViewRD.jsp;ATTACHMENTS=1fTvdTtC8v1mzWxXqsWNxw2BFWwHpdcSQM90
fP1g21sy8CTyXHgB!-784178296!-
1151086485?applType=search&fileKey=1888085105&attachmentKey=20103063&
attachmentInd=applAttach.
\43\ See ``DISH to release deployment services RFP for
standalone 5G network buildout'' (Oct. 21, 2019), https://ir.dish.com/news-releases/news-release-details/dish-release-deployment-services-rfp-standalone-5g-network; Letter from Jeffrey
Blum (DISH) to Marlene H. Dortch (FCC), WT Docket No. 18-197, at 4
(Aug. 1, 2019) (``Blum Aug. 1, 2019 Letter''), available at https://ecfsapi.fcc.gov/file/10801235883258/2019-08-01%20DISH%20%20EX%20Parte%20WT%20Docket%20No%2018-197%20(w%20summary).pdf; see also Martha DeGrasse, Fierce Wireless,
``Dish Casts Wide Net to Vendor Community'' (Aug. 12, 2019), https://www.fiercewireless.com/wireless/dish-casts-wide-net-to-vendor-community.
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DISH has not, as some commenters suggest, violated the FCC's
construction requirements for its spectrum licenses. Those licenses
have two relevant dates: An interim construction milestone and a final
construction milestone. The FCC provides licensees (and in this case,
DISH) with the choice of (1) satisfying both construction milestones,
or (2) missing the interim milestones and agreeing to accelerate the
final milestones by one year. DISH chose not to meet the interim
construction milestones for its licenses, which meant that its final
construction milestones were accelerated.\44\ These final milestones
have not yet passed, and prior to the remedy discussions in this case,
DISH had provided the FCC with a proposal on how it planned to meet
them. Specifically, DISH planned to rely on the FCC's ``flexible use''
policy, which permits licensees to choose the technology they use to
meet their construction milestones, in order to execute a two-phase
network deployment plan: (1) Deploy a narrowband Internet of Things
(``NB-IoT'') network before the final construction milestones had
passed, and (2) use this NB-IoT network as a foundation to ultimately
deploy a 5G network at a later date.\45\ The United States agrees with
commenters who argue that having DISH construct a 5G network
immediately is preferable to this two-stage plan, but any suggestion
that DISH has violated the FCC's requirements is simply incorrect.\46\
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\44\ See DISH March 7, 2017 Buildout Report at 4 (certifying
that DISH planned to meet the accelerated final construction
milestones); Letter from Jeffrey Blum (DISH) to Donald Stockdale
(FCC) (Sept. 21, 2018) (explaining that ``[s]uch a bridge to a 5G
deployment is necessary because, among other things, equipment/
installation availability for full standalone 5G (3GPP Release 16)
will only be available after the March 2020 buildout milestones for
our AWS-4 and E Block licenses, making it impractical for us to
deploy 5G before such date.''), available at https://wireless2.fcc.gov/UlsEntry/attachments/attachmentViewRD.jsp?applType=search&fileKey=1089751155&attachmentKey
=20454822&attachmentInd=licAttach.
\45\ Id. at 6-7.
\46\ Given this background, the Economics Professors' claim that
Dish has ``no history or presence in this industry'' is also
incorrect. Economics Professors Comment (Exhibit 12) at 3. In
connection with its NB-IoT plans, DISH had established relationships
with vendors, leased towers, and acquired equipment for a core
network. See Mike Dano, Fierce Wireless, ``DISH's First Wireless
Partners Revealed: Ericsson and SBA'' (Nov. 8, 2019), https://www.fiercewireless.com/iot/dish-s-first-wireless-partners-revealed-ericsson-and-sba.
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The economics of DISH's entry under the proposed Final Judgment are
fundamentally different--and more favorable to DISH--than what was
available to DISH before the proposed Final Judgment. Much of the
relief in the proposed Final Judgment is to provide DISH with assets
and resources to make its entry as a nationwide, facilities-based
wireless carrier easier and more certain. DISH has explained that the
proposed Final Judgment ``will facilitate and accelerate DISH's entry
into the wireless market as a 5G competitor by, among other things,
enabling DISH to deploy its spectrum at the same time to provide a
better overall 5G service, at lower cost, and on a more efficient
deployment schedule.'' \47\ In particular, the divestiture of Sprint's
prepaid businesses will enable DISH to serve an existing base of 9
million subscribers. This customer base will put DISH into the wireless
business immediately upon the closing of the divestitures, without
first having to construct a network from scratch. DISH will have the
option of acquiring more than 20,000 cell sites and upwards of 400
retail locations directly from T-Mobile, further reducing the burdens
of building out a new network. As DISH completes its network buildout,
it will be in position to move existing subscribers onto its new
network in short order, allowing it to immediately monetize its own
network by shifting away from using a third-party network to serve
subscribers. Finally, the Full MVNO Agreement will give DISH the
flexibility to serve customers the most efficient and cost-effective
way, whether on post-merger T-Mobile's network, DISH's new network, or
a combination of both. In light of these changes, DISH has agreed to
waive its ``flexible use'' rights and deploy a 5G network immediately
rather than taking the intermediate step of deploying an NB-IoT network
first.\48\
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\47\ Blum Aug. 1, 2019 Letter at 3; see also FCC Order ] 372
(``We agree with DISH that its acquisition of Sprint's prepaid
assets along with the set of MVNO, wholesale, and roaming rights
agreed to with the Applicants provides DISH the means to provide
nationwide service on a competitive 5G network.'').
\48\ Blum July 26, 2019 Letter at 3 (``DISH will voluntarily
waive its flexible use rights''); Blum Aug. 1, 2019 Letter at 3
(``Rather than approaching a network build in two phases, DISH will
be able to shift the resources it has dedicated to building out a
narrowband Internet of Things network to a 5G network
deployment.'').
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RWA raises concern over the fact that the proposed Final Judgment
provides DISH with a degree of flexibility as to which of T-Mobile's
assets it will ultimately acquire.\49\ RWA suggests that DISH should be
required to purchase the 800 MHz Spectrum, regardless of whether it
deems it necessary, as well as every one of the cell sites and retail
locations that T-Mobile plans to decommission.\50\ Such an obligation,
however, would be counterproductive. The proposed Final Judgment gives
DISH the flexibility to decline purchase of the 800 MHz spectrum if it
is able to make significant progress in deploying
[[Page 61648]]
its network without that spectrum.\51\ Likewise, the proposed Final
Judgment provides DISH with the option to purchase only those cell
sites and retail locations that it needs to support its network
deployment and business plans. The proposed Final Judgment requires
DISH to comply with specific build commitments, including relating to
nationwide 5G.\52\ Requiring DISH to purchase assets that turn out to
be unnecessary would increase DISH's costs and impede its entry as a
mobile wireless provider. In contrast, by giving DISH the flexibility
to purchase only the assets that it needs in order to comply with the
overarching directive to meet its nationwide 5G commitment, the
proposed Final Judgment will allow DISH's entry to proceed efficiently.
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\49\ RWA Comment (Exhibit 24) at 17-18.
\50\ Id. at 18.
\51\ While AAI claims that the 800 MHz spectrum is ``necessary
to build out a 5G network'' (AAI Comment (Exhibit 2) at 8), the
proposed Final Judgment recognizes that DISH may find that it is
able to deploy a competitive network that does not rely on this
spectrum.
\52\ PFJ Sec. VIII.A.
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Moreover, DISH will be subject to substantial penalties if it fails
to satisfy its commitments. Failure to meet its network buildout
obligations would cause DISH to incur penalties of up to $2.2 billion
under its commitments to the FCC alone.\53\ Failure to meet certain
buildout milestones would also result in ``automatic termination'' of
some of DISH's spectrum licenses.\54\ The proposed Final Judgment
further provides for DISH to pay a penalty of $360,000,000 if it elects
not to purchase the 800 MHz Spectrum Licenses, unless it has already
made significant progress in constructing its network.\55\ All of this
would be in addition to other penalties that this Court could impose if
it were to find DISH to be in violation of the Final Judgment.\56\
---------------------------------------------------------------------------
\53\ Blum July 26, 2019 Letter, Attachment A at 4.
\54\ Id. at 3-4. Thus, claims that DISH's financial penalties
alone would be insufficient to ensure compliance are misplaced. See,
e.g., RWA Comment (Exhibit 24) at 15-16. Nor do DISH's commitment to
the FCC that it will not sell certain of its spectrum licenses for
six years somehow suggests that they are planning to exit the mobile
wireless market after that time period concludes, as RWA claims. Id.
at 18-19. RWA provides no support for this assertion. DISH's
commitment to the FCC merely ensures that it will maintain ownership
of its wireless licenses while its network buildout advances.
\55\ See PFJ Sec. IV(B)(2).
\56\ See id. Sec. XVIII(A) (``The United States retains and
reserves all rights to enforce the provisions of this Final
Judgment, including the right to seek an order of contempt from the
Court.'').
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CWA includes in its comment a declaration from engineering
consultant Andrew Afflerbach, Ph.D., P.E., which purports to support
CWA's criticisms of the proposed Final Judgment. Dr. Afflerbach begins
by highlighting several potential risks that DISH will be unable to
build a successful facilities-based mobile wireless business. He notes
that DISH will be highly dependent on T-Mobile as an MVNO for years
following entry of the proposed Final Judgment, and notes the
``criticality of the MVNO agreement terms'' for DISH's success.\57\
However, DISH itself has explained that the Full MVNO Agreement will
provide DISH with ``more attractive economics than traditional MVNO
agreements, including pricing, packaging and marketing flexibility, a
mechanism for costs to drop over time, and access to core control.''
\58\ The FCC likewise recognizes that ``New Boost's wholesale network
access agreement will be unique among MVNO agreements in the industry,
with more favorable terms and conditions that, in turn, will enable New
Boost to more effectively constrain potential price increases.'' \59\
---------------------------------------------------------------------------
\57\ Afflerbach Decl. ]] 7, 11.
\58\ Blum Aug. 1, 2019 Letter at 2.
\59\ FCC Order ] 201.
---------------------------------------------------------------------------
Dr. Afflerbach also argues that ``DISH's execution risks are
substantial.'' \60\ His criticisms about DISH's prospects for building
a 5G network overstate some of the challenges that DISH faces. For
instance, Dr. Afflerbach suggests that DISH will be disadvantaged
because ``[h]andset equipment (i.e. smartphones) is not currently
manufactured for DISH's spectrum bands.'' \61\ The current generation
of smartphones, however, does support LTE service in DISH's holdings in
the 600 MHz band (Band 71), the AWS-3 band, and the AWS-4 band
(collectively, Band 66).\62\ This is because other established players
like T-Mobile and Verizon each offer LTE service in one or more of
those bands. There is no reason to believe that DISH will not similarly
be able to find support for 5G service in at least some of its spectrum
bands as equipment-makers design handsets for the other carriers.
---------------------------------------------------------------------------
\60\ Afflerbach Decl. ] 36.
\61\ Afflerbach Decl. ] 45.
\62\ See Chris Holmes, Whistle Out, ``Cell Phone Networks and
Frequencies Explained: 5 Things To Know'' (Oct. 14, 2019) (noting
Verizon, AT&T and T-Mobile are currently using Band 66, and T-Mobile
is currently using Band 71), https://www.whistleout.com/CellPhones/Guides/cell-phone-networks-and-frequencies-explained; Dan Meyer, RCR
Wireless News, ``T-Mobile LTE network beats AT&T and Verizon with
AWS-3 spectrum support'' (Oct. 17, 2016) (noting T-Mobile ``touting
itself as the first domestic carrier to launch commercial services
across the AWS-3 spectrum band''), https://www.rcrwireless.com/20161017/carriers/t-mobile-lte-network-beats-att-verizon-aws-3-spectrum-support-tag2.
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2. DISH's Incentive and Ability To Compete
Some commenters also question whether DISH will have the incentive
and ability to compete vigorously in the mobile wireless marketplace.
For example, CWA asserts that ``DISH has powerful incentives to create
something less than a fully competitive 5G network.'' \63\ Mr.
Bellemare claims that ``Sprint is a maverick'' but ``[w]hether DISH
would become a maverick in a more concentrated oligopoly is by no means
assured.'' \64\ Other commenters argue that the fact that DISH's
wireless business will initially have only 9 million subscribers will
inhibit its competitiveness.\65\
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\63\ CWA Comment (Exhibit 10) at 19.
\64\ Bellemare Comment (Exhibit 6) at 13-14.
\65\ See, e.g., RWA Comment (Exhibit 24) at 8 (``[T]he various
Sprint prepaid subscriber bases, which Dish estimates to include
approximately 9.3 million users, are a fraction of Sprint's overall
subscriber base.''). AAI and RWA both point to the fact that DISH
will initially serve only prepaid subscribers, which are generally
less profitable to serve than postpaid subscribers. See AAI Comment
(Exhibit 2) at 7; RWA Comment (Exhibit 24) at 8, 12. DISH, however,
has committed to providing postpaid mobile wireless service within
one year of the closing of the sale of the prepaid assets. PFJ Sec.
IV(F). Moreover, after spending the significant resources required
to become a mobile wireless service provider, DISH will have strong
business incentives to serve all profitable segments of the market.
---------------------------------------------------------------------------
As an initial matter, commenters overlook the substantial
advantages on which DISH currently can draw to grow its wireless
business. The fact that DISH is unburdened by any need to support a
legacy infrastructure based on older technology and has an established
presence in a complementary video business, may enhance its ability to
price aggressively and attract customers. In addition, and contrary to
the commenters' claims, the proposed Final Judgment will position DISH
to be an effective competitor to the existing carriers. As described
above, the merger, when combined with the proposed Final Judgment,
promises to expand output. A significant amount of unused and underused
spectrum will be made available by both DISH and T-Mobile for use by
consumers within the first years following the closing of the
divestiture. Principles of economics tell us that expanded output
provides further downward pressure on prices moving forward. Indeed,
competition in the wireless industry has often been driven by the
smallest of the nationwide carriers, to the benefit of consumers.\66\
[[Page 61649]]
T-Mobile was previously branded as the maverick and had success in
growing its share. Such a firm can discipline prices based on its
ability and incentive to expand production rapidly using available
capacity, or on its willingness to resist otherwise-prevailing industry
norms to cooperate on price setting or other terms of competition.\67\
Moreover, even during the period in which DISH is relying on the Full
MVNO Agreement, other mobile wireless providers will have full
knowledge of DISH's obligations to deploy network infrastructure in the
coming years, which itself may have a further constraining effect on
their decision-making.
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\66\ Given the potential for smaller market participants to
drive competition, RWA is simply incorrect in claiming that
increased coordination among AT&T, Verizon, and T-Mobile will be
``inevitable'' given that ``DISH on Day One'' will have fewer
subscribers than Sprint and T-Mobile do today. RWA Comment (Exhibit
24) at 13.
\67\ Dep't of Justice & Fed Trade Comm'n, Horizontal Merger
Guidelines Sec. 2.1.5 (2010).
---------------------------------------------------------------------------
The Economics Professors point to T-Mobile CEO John Legere's
statement that T-Mobile's agreement with DISH will not diminish the
merged firm's synergies, profitability, and long-term cash generation
as evidence that DISH will not be a disruptive competitor.\68\ This
line of argument assumes that the remedy would have to be harmful to T-
Mobile in order to be good for consumers. In fact, T-Mobile stands to
benefit by selling DISH wholesale access to its network, even as it
stands to lose retail customers to DISH.\69\ The relevant question for
the Court is not how these two competing effects net out for T-Mobile,
but rather whether DISH will introduce new competition into the
marketplace that will benefit consumers. In a portion of the same
investor call that the Economics Professors do not cite, Mr. Legere
told investors that ``it's very clear that with the spectrum that DISH
has, with the acquisition of Boost, with the MVNO arrangement, [with]
the transition services agreement while they build out their network,
with the ability to get some of the decommissioned towers and stores,
DISH has a real significant opportunity to be a very credible
disruptive fourth wireless carrier,'' \70\ which is consistent with T-
Mobile's other public statements.\71\ Indeed, DISH has disrupted other
established industries in the past, and disrupting the mobile wireless
market would be a welcome continuation of that trend.\72\
---------------------------------------------------------------------------
\68\ Economics Professors Comment (Exhibit 12) at 11.
\69\ See T-Mobile US, Inc. (TMUS) CEO John Legere on Q2 2019
Results--Earnings Call Transcript, Seeking Alpha, (July 29, 2019),
at 9 (noting that the agreement ``will be accretive to our business
because the pricing allows us to monetize DISH's access of our
network'').
\70\ Id. at 10.
\71\ See, e.g., Monica Alleven, Fierce Wireless, ``T-Mobile CFO
on Dish Rivalry: Bring It On'' (Sept. 24, 2019) (quoting T-Mobile
CFO Braxton Carter remarks that DISH will be ``extremely viable''
and ``a fierce competitor, there's no doubt about it''), https://www.fiercewireless.com/wireless/t-mobile-cfo-dish-rivalry-bring-it.
\72\ As noted in the Wall Street Journal, DISH's controlling
shareholder, Charlie Ergen, ``has often played the role of
disrupter.'' Drew Fitzgerald, Wall Street Journal, ``A TV Maverick
Is Going All-In on a New Wireless Bet'' (July 27, 2019), available
at https://www.wsj.com/articles/a-tv-maverick-is-going-all-in-on-a-new-wireless-bet-11564200000. The article notes that Mr. Ergen and
his partners began selling ``10-foot-wide satellite dishes from a
Denver storefront,'' then ``switched to hubcap-size dishes and took
on cable-TV monopolies by slashing prices.'' Id. (noting the
``service now has 12 million customers across the country and his
controlling stake in Dish is worth about $9 billion''). DISH also
launched ``one of the first live-TV streaming services, Sling TV, in
early 2015.'' Id. (noting that with ``a small package of channels
and lower price, it made it easy for millions of people to cut their
TV bill--even many of Dish's own satellite customers''). The
settlement enables DISH to continue its disruptive history in the
wireless business. See id. (Ergen noting that ``with four, there's
always somebody that will be a rabble rouser,'' and that while
somebody ``will say I don't have enough market share,'' ``I've only
got 9 million subs and want 10 million. That person is going to be
more aggressive.''). See also DISH July 26, 2019 Press Release
(``When we entered pay-TV with the launch of our first satellite in
1995, we faced entrenched cable monopolies, and our direct
competitor was owned by one of the largest industrial corporations
in the world. As a new entrant, DISH encountered many skeptics who
questioned our ability to succeed. But, customers loved the
disruption we brought to the marketplace with innovations such as a
100-percent digital experience, local-into-local broadcast, the DVR
and ad-skipping. Our substantial investments, constant innovation,
aggressive pricing and commitment to the customer led us to become
the third largest pay-TV provider. As we enter the wireless
business, we will again serve customers by disrupting incumbents and
their legacy networks, this time with the nation's first standalone
5G broadband network.'').
---------------------------------------------------------------------------
Some commenters focus on the near-term period prior to DISH's
construction of its forthcoming mobile wireless network. For example,
Public Knowledge et al. claim that ``DISH will be a nonfactor, as all
MVNOs are'' during this period.\73\ Under the terms of the proposed
Final Judgment, DISH will be able to compete for subscribers
immediately using the wholesale agreement and will transition into a
full, facilities-based competitor as it constructs its planned network.
As discussed above, the broad array of rights that T-Mobile will
provide to DISH under the Full MVNO Agreement will empower DISH to
become a more effective competitor than traditional MVNOs have been in
the past. Additionally, the proposed Final Judgment's requirement that
DISH begin offering postpaid plans within one year ensures that DISH
will begin to restore the lost competition promptly, and, in any event,
well before T-Mobile's commitments to the FCC expire.\74\ The favorable
terms in the Full MVNO Agreement will provide DISH with an attractive
cost structure, and thus, an incentive to compete immediately. DISH's
incentive to expand its output will only increase as DISH begins to
realize cost savings by shifting traffic from T-Mobile's network onto
its own.\75\
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\73\ Public Knowledge et al. Comment (Exhibit 22) at 2; see also
Wool Comment (Exhibit 32) at 2 (``Mr. Wool asks, ``[g]iven the time
required for DISH Network to build a national facilities-based
network (i.e. DISH Network has until June 2023 to construct a
network covering 70% of the population), how does the proposed Final
Judgment `preserve the status quo ante in affected markets.''').
\74\ See FCC Order ] 206 (``[T]he requirement that DISH offer
postpaid services bolsters our conclusion that the Boost divestiture
buyer will not merely constrain price increases within the prepaid
segment, but across the differentiated retail mobile wireless
services market.'').
\75\ Suggestions that DISH will find it in itself too
comfortable as an MVNO and decline to carry out its obligations
under the decree overlook the various ways the decree guards against
this risk. See Economics Professors Comment (Exhibit 12) at 9 (``Why
would Dish invest and become a facilities-based provider if the
margins from resale are large and guaranteed for seven years?'').
For example, the proposed Final Judgment limits the term of any
Transition Services Agreement to two years, with the possibility of
a third subject to approval by the United States after consultation
with its co-Plaintiff States. PFJ Sec. IV.A.4. Thus, DISH is
required to wean itself from T-Mobile's transitional support in
``billing, customer care, SIM card procurement, device provisioning,
and all other services used by the Prepaid Assets'' by 2022 or 2023.
The deadline of 2022 coincides with DISH's commitment to the FCC to
offer broadband service to at least 20% of the United States
population. Blum July 26, 2019 Letter at 2. Thus, by 2022 DISH is
required to establish itself as an independent, facilities-based
operator, and its achievement of these commitments will be
supervised closely by the Monitoring Trustee. In an attempt to cast
further doubt on DISH's plans, the Economics Professors compare DISH
to 1&1 Drillisch, an MVNO in Germany that has announced its
intention to become the fourth German facilities-based mobile
wireless provider by constructing its own 5G network. Economics
Professors Comment (Exhibit 12) at 10; see also Juan Pedro Tomas,
RCR Wireless News, ``1&1 Drillisch Confirms Intention to Become
Germany's Fourth Mobile Carrier'' (Jan. 25, 2019), https://www.rcrwireless.com/20190125/5g/drillisch-confirms-intention-become-germany-fourth-mobile-carrier. The Economics Professors ignore the
fact that, since the date of the article they cite, 1&1 Drillisch
successfully secured financing to participate in a German spectrum
auction and won 70 MHz worth of spectrum licenses to support its
network deployment plan. See Reuters, ``Shares in 1&1 Drillisch soar
after Germany 5G auction'' (June 13, 2019) (``Shares in 1&1
Drillisch surged on Thursday after it won spectrum in Germany's 5G
mobile auction that ensured its position as a new fourth operator in
a market that has lagged globally.''), available at https://www.reuters.com/article/germany-telecoms/shares-in-11-drillisch-soar-after-germany-5g-auction-idUSS8N22R022.
---------------------------------------------------------------------------
Other commenters raise concerns regarding the portion of the
country that DISH's mobile wireless network will cover and its future
network performance. For example, RWA argues that DISH could meet its
population-based buildout obligations while covering ``only a small
fraction of the
[[Page 61650]]
country's geography.'' \76\ Similarly, the Economics Professors assert
that ``because the coverage requirement is denominated in terms of
population, not geography, it is clear that certain parts of the
country will lose out.'' \77\ CWA argues that at a speed of 35 Mbps
``the result will not be a bona fide fourth network, but a niche
network closer to the limited Internet of Things (IoT) network proposed
by DISH prior to the T-Mobile deal.'' \78\ These arguments reflect a
misunderstanding of DISH's network build commitments. These commitments
were incorporated into the proposed Final Judgment to increase the
incentives for DISH to build out its own national facilities-based
mobile wireless network.\79\ These commitments should not, however, be
interpreted as predictions of the likely breadth of DISH's network
coverage or its likely speed. The proposed Final Judgment does not
dictate the scope of DISH's future investments, but rather provides
DISH with necessary assets and appropriate incentives, and then relies
on market forces to guide DISH's long-term decisions about where to
target its investments. DISH may ultimately have business incentives to
provide substantially broader coverage and faster speeds than the
minimums required to meet its network build commitments. By focusing on
the floors set by the proposed Final Judgment rather than the likely
effects of the divestiture, these commenters miss the relevant inquiry.
---------------------------------------------------------------------------
\76\ RWA Comment (Exhibit 24) at 14.
\77\ Economics Professors Comment (Exhibit 12) at 11.
\78\ CWA Comment (Exhibit 10) at 3.
\79\ See Competitive Impact Statement (Dkt. No. 20) at 11-12.
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Separate criticisms that the proposed merger benefits rural
customers at the expense of urban ones and that the United States'
remedy benefits urban customers at the expense of rural ones illustrate
why entry of the proposed Final Judgment is in the public interest. The
Economics Professors argue that ``even if one were to credit'' (as the
FCC now has \80\) the claimed benefit from the merger of ``enhanced 5G
deployment in otherwise unprofitable-to-deploy neighborhoods,'' these
``largely rural households are distinct from those urban and suburban
households that likely will incur a price increase on 4G services
resulting from the merger.'' \81\ In turn, Andrew Afflerbach, the
engineer whose declaration was submitted along with the CWA comments,
observes that the ``most straightforward way [for DISH] to serve 70
percent of the population is to focus on urban areas,'' which would
mean DISH's ``2023 benchmark stops well short of the scale of the
networks operated by the four existing MNOs.'' \82\ Together, these
concerns only confirm that the proposed Final Judgment fulfills the
twin goals of a merger remedy. It permits the merger to proceed,
enabling rural consumers to benefit from its promised efficiencies,
while adopting remedies that will protect consumers in and bring new
competition to urban areas that may have been at greater risk from this
merger without this settlement.
---------------------------------------------------------------------------
\80\ See FCC Order ]] 257-76 (explaining the benefits of the
merger for consumers in rural areas).
\81\ Economics Professors Comment (Exhibit 12) ] 11.
\82\ Afflerbach Dec. ] 51.
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C. Comments Regarding the Enforceability of the Proposed Final Judgment
Other commenters claim that the proposed Final Judgment is too
complicated or too ``behavioral'' to be enforced. CWA and others cite
statements in which current and former leaders of the Antitrust
Division have identified challenges associated with behavioral
conditions.\83\ The commenters claim that the proposed Final Judgment
is inconsistent with these statements, and they suggest that these
inconsistencies should be a basis for denial.\84\ These types of
argument lack legal support and do not accurately describe the inquiry
before the Court. They also misstate the facts of the proposed Final
Judgment and the Division's policies.
---------------------------------------------------------------------------
\83\ See CWA Comment (Exhibit 10) at 10-12, 23.
\84\ Id.; see also Wool Comment (Exhibit 32) at 2, 3. Based on
his skepticism, Mr. Wool asserts that the proposed Final Judgment
``dramatically reinterprets the risk-allocation framework intended
by Section 7 of the Clayton Act.'' Wool Comment at 1. This argument
disregards the principle that ``[a] district court must accord due
respect to the government's prediction as to the effect of proposed
remedies, its perception of the market structure, and its view of
the nature of the case.'' United States v. Archer-Daniels-Midland
Co., 272 F.Supp.2d 1, 6 (D.D.C. 2003).
---------------------------------------------------------------------------
Objections to the settlement that are based on parsing which
elements are structural and which are behavioral miss the important
larger point. The overall objective of the remedy is profoundly
structural, as it is designed to stand up a fourth nationwide,
facilities-based wireless carrier. The mechanisms for doing so begin
immediately with a structural divestiture to prevent the consolidation
of Sprint's prepaid business into T-Mobile's, and the non-structural
elements of the proposed Final Judgment are largely aimed at enabling
DISH to begin providing wireless services to consumers immediately, to
grow that business as it builds its own network, and to enable it to
stand on its own as an effective facilities-based competitor before the
end of the decree's term.\85\
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\85\ Although Mr. Wool takes issue with the proposed Final
Judgment's condition requiring the merged firm to extend existing
MVNO agreements, he simultaneously argues (1) that the condition is
too behavioral, and (2) that the condition does not do enough to
protect future innovation. Wool Comment (Exhibit 32) at 3-4 & n.8.
By relying on existing agreements, the condition as written does not
require regular, ongoing oversight by the United States. In
contrast, additional intervention to control the merged firm's
conduct with respect to other MVNOs in the future would have
required further involvement by the United States in the
marketplace.
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Indeed, while the Antitrust Division has expressed a preference for
structural remedies, it has not taken the position that behavioral
conditions are never appropriate. In fact, the 2004 Remedies Guide
explains that ``there are limited circumstances when conduct remedies
will be appropriate: (a) When conduct relief is needed to facilitate
transition to or support a competitive structural solution, i.e., when
the merged firm needs to modify its conduct for structural relief to be
effective or (b) when a full-stop prohibition of the merger would
sacrifice significant efficiencies and a structural remedy would also
sacrifice such efficiencies or is infeasible.'' \86\ As to (a), the
guide provides examples of potentially appropriate behavioral
conditions that can help ``perfect structural relief,'' such as
transitional supply agreements between the merged firm and the
divestiture buyer and temporary limits on the merged firm's ability to
reacquire personnel from the divestiture buyer.\87\ The guide further
notes that enforcing behavioral conditions may be easier, and thus such
conditions may be more appropriate, in markets subject to ongoing
oversight by regulatory agencies.\88\
---------------------------------------------------------------------------
\86\ 2004 Remedies Guide at 18. Cf. ``Assistant Attorney General
Makan Delrahim Delivers Keynote Address at American Bar
Association's Antitrust Fall Forum'' (Nov. 16, 2017) (stating the
Antitrust Division would accept behavioral remedies ``where an
unlawful vertical transaction generates significant efficiencies
that cannot be achieved without the merger or through a structural
remedy''), available at https://www.justice.gov/opa/speech/assistant-attorney-general-makan-delrahim-delivers-keynote-address-american-bar.
\87\ 2004 Remedies Guide at 18-19.
\88\ Id. at 22.
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The remedy in this case is ultimately structural, and fits squarely
within the first circumstance described in the 2004 Remedies Guide--it
is intended to bring about the entry of an independent, facilities-
based mobile wireless network operator with the incentive and ability
to compete with the other national carriers. DISH has agreed to acquire
[[Page 61651]]
Sprint's prepaid businesses for $1.4 billion and Sprint's 800 MHz
spectrum for $3.6 billion, and it has the option to acquire cell sites
and retail locations from the merged firm. Other aspects of the
proposed Final Judgment are intended to ensure that these divestitures
(and DISH's entry into the mobile wireless market more generally) are
successful. Several of these provisions are akin to the examples of
appropriate conditions set forth in the Remedies Guide. The Full MVNO
Agreement will require T-Mobile to supply DISH with network access on a
transitional basis. This will allow DISH to enter the market
immediately, providing for MVNO-based competition while DISH works to
deploy network facilities. DISH's network buildout obligations will
ensure that this transition proceeds in a timely manner. The temporary
prohibition on T-Mobile rehiring employees from the divested business
will assist DISH in maintaining the personnel required to compete
effectively.
The proposed Final Judgment in this case also fits within the
second circumstance that the Remedies Guide describes as an appropriate
context for behavioral relief--at least in the short term. The merger
promises to yield significant efficiencies by enabling T-Mobile to
offer 5G mobile wireless services more cost-effectively. These
efficiencies would not be realized if the merger were blocked or if T-
Mobile were required immediately to divest all of Sprint's existing
infrastructure. Further, T-Mobile's network buildout obligations and
associated penalties provide additional incentives to ensure that the
merged firm will invest in a robust 5G network that becomes available
to consumers quickly. These efficiencies will work in combination with
the new competitive threat posed by DISH to offset any further harm
that may arise from the transaction. By the time the proposed Final
Judgment expires, and likely sooner, DISH will provide a fourth
nationwide retail mobile wireless option for American consumers, and
neither the Antitrust Division nor this Court will need to maintain
ongoing entanglements with the company's business. Including a
transitional period in which certain behavioral conditions are present,
however, will ensure that consumers get the immediate benefits expected
from the merger without risking anticompetitive harm.
These goals are consistent with the position on behavioral remedies
expressed in the 2004 Remedies Guide and with the enforcement decisions
made by the Antitrust Division. As noted, the Remedies Guide states
that transitional behavioral remedies are appropriate for ensuring the
effectiveness of structural relief.\89\ In keeping with that principle,
the Final Judgment submitted by the United States and adopted by Judge
Boasberg in United States v. Bayer contained substantial divestitures
to ensure a long-term structural solution, along with shorter-term
behavioral relief including supply agreements with the possibility of
extension for up to a total of six years.\90\
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\89\ 2004 Remedies Guide Section III.E.1 (``Limited conduct
relief can be useful in certain circumstances to help perfect
structural relief.'').
\90\ Final Judgment, United States v. Bayer AG, No. 18-cv-1241,
at 22-23, 24, 25 (D.D.C. Feb. 08, 2019).
---------------------------------------------------------------------------
More fundamentally, the remedies here are consistent with
longstanding guidance that the remedy must be tailored to the
particular facts of the industry at hand.\91\ Here, building a mobile
wireless network takes several years. That fact alone does not bar the
adoption of appropriate remedies, and the remedy here necessarily and
appropriately reflects that fundamental fact in the interim and final
buildout timelines and the overall term of the decree. The timelines
also account for the ongoing transition from 4G to 5G, which ultimately
will permit DISH to put into service a new, greenfield 5G wireless
network unencumbered by older technology. This is consistent with
guidance that the remedy be tailored to the specific characteristics of
the divestiture buyer.\92\ With this remedy, DISH will bring spectrum
(that it currently has no obligation to build out in this way) into
service as a mobile broadband 5G service that will serve consumers
across the country. With a proposed merger that promises public
benefits in the form of stronger 5G competition and expanding output,
it is consistent with the Antitrust Division's announced policies to
craft this settlement in a way that protects those efficiencies,
increases output further through the choice of divestiture buyer, while
still guarding against competitive harm.
---------------------------------------------------------------------------
\91\ 2004 Remedies Guide at 2 (encouraging the Division to
``[f]ocus[ ] carefully on the specific facts of the case at hand''
to ``permit the adoption of remedies specifically tailored to the
competitive harm,'' and noting that ``there must be a significant
nexus between the proposed transaction, the nature of the
competitive harm, and the proposed remedial provisions''). CWA pulls
quotations from the 2004 Remedies Guide that it believes call into
question the proposed remedy here. CWA Comment (Exhibit 10) at 4-11,
13, 19. As discussed in this section, the United States vigorously
disputes the notion that the proposed Final Judgment is at bottom
inconsistent with the Antitrust Division's own guidance. CWA simply
ignores the Remedies Guide provisions discussed in this section that
explain why this remedy is in keeping with Division policy, and it
also ignores the stated purpose of the Guide itself. The Guide ``is
a policy document, not a practice handbook,'' it does not list or
give ``particular language or provisions that should be included in
any given decree,'' but instead it ``sets forth the policy
considerations that should guide Division attorneys and economists
when fashioning remedies for anticompetitive mergers.'' 2004
Remedies Guide at 1-2. As called for by its own Guide, and as
explained in this Response to Comments, in arriving at this proposed
Final Judgment the Antitrust Division has applied ``the pertinent
economic and legal principles, appropriate analytical framework, and
relevant legal limitations'' to ``craft and implement the proper
remedy for the case at hand.'' Id. at 2.
\92\ See 2004 Remedies Guide at 31 n.43 (noting that ``if
harmful coordination is feared because the merger is removing a
uniquely-positioned maverick, the divestiture would likely have to
be to a firm with maverick-like interests and incentives''); id. at
5 (noting that ``assessing the competitive strength of a firm
purchasing divested assets requires more analysis than simply
attributing to this purchaser past sales associated with those
assets'').
---------------------------------------------------------------------------
Moreover, the proposed Final Judgment contains substantial
monitoring and enforcement mechanisms. These mechanisms will operate in
parallel with the ongoing regulatory oversight that the FCC will
perform to ensure compliance with its own conditions.\93\ The United
States will be moving this Court to appoint a monitoring trustee with
the power and authority to investigate and report on the Defendants'
compliance with the terms of the Final Judgment and the Stipulation and
Order during the pendency of the divestiture. The monitoring trustee
will help ensure, among other things, that T-Mobile complies with its
obligations relating to its sale of the Divestiture Assets, the
exclusive-option requirements for cell sites and retail store
locations, and DISH's progress toward using the Divestiture Assets to
operate a retail mobile wireless network.
---------------------------------------------------------------------------
\93\ See, e.g., FCC Order ] 204 (``The Boost Divestiture
Conditions also provide for strong Commission oversight to ensure
the effectiveness of these principles to ensure New Boost is a
meaningful competitor.''); id. ] 378 (``DISH continues to be subject
to all of the Commission's other enforcement and regulatory powers,
including the loss of part or all of any of its licenses for failing
to meet its build-out requirements.'').
---------------------------------------------------------------------------
The United States retains and reserves all rights to enforce the
provisions of the proposed Final Judgment, including its rights to seek
an order of contempt from the Court. Defendants have agreed that in any
civil contempt action, any motion to show cause, or any similar action
brought by the United States regarding an alleged violation of the
Final Judgment, the United States may establish the violation and the
appropriateness of any remedy by a preponderance of the evidence and
that Defendants have waived any argument that a different standard of
proof should
[[Page 61652]]
apply.\94\ This provision aligns the standard for compliance
obligations with the standard of proof that applies to the underlying
offense that the compliance commitments address. Defendants also agree
that they may be held in contempt of this Court for failing to comply
with any provision of the proposed Final Judgment that is stated
specifically and in reasonable detail, as interpreted in light of the
goal of the proposed Final Judgment to restore competition that would
otherwise be permanently harmed by the merger.\95\
---------------------------------------------------------------------------
\94\ PFJ Sec. XVIII(A).
\95\ Id. Sec. XVIII(B).
---------------------------------------------------------------------------
The United States may also apply to the Court for a one-time
extension of the Final Judgment, together with other relief as may be
appropriate, if the Court finds in an enforcement proceeding that
Defendants have violated the terms of the decree.\96\ In addition, in
any successful effort by the United States to enforce the Final
Judgment against a Defendant, whether litigated or resolved before
litigation, Defendants will reimburse the United States for attorneys'
fees, experts' fees, and other costs incurred in connection with any
enforcement effort, including the investigation of the potential
violation.\97\
---------------------------------------------------------------------------
\96\ Id. Sec. XVIII(C).
\97\ Id.
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Finally, although the Final Judgment is set to expire seven years
from the date of its entry,\98\ the United States may file an action
against a Defendant for violating the Final Judgment for up to four
years after the Final Judgment has expired or been terminated.\99\ This
provision is meant to address circumstances such as when evidence that
a violation of the Final Judgment occurred during the term of the Final
Judgment is not discovered until after the Final Judgment has expired
or been terminated or when there is not sufficient time for the United
States to complete an investigation of an alleged violation until after
the Final Judgment has expired or been terminated. This provision thus
makes clear that the United States may still challenge a violation that
occurred during the Final Judgment's term, for four years after it
expired or was terminated.
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\98\ Id. Sec. XIX. The Final Judgment may be terminated after
five years from the date of its entry upon notice by the United
States to the Court and Defendants that the divestitures have been
completed and that the continuation of the Final Judgment is no
longer necessary or in the public interest. Id.
\99\ Id. Sec. XVIII(D).
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D. Other Comments Opposing Entry of the Proposed Final Judgment
1. Comments Regarding Harms Outside the Scope of the Complaint
Some commenters raise harms that are outside the scope of the
complaint filed in this case, and they propose remedies to address
those harms. These comments extend beyond the permissible scope of the
Tunney Act review.\100\ A few commenters, claiming to rely on a recent
opinion interpreting the Tunney Act, urge this Court to engage in a
broader inquiry.\101\ That opinion, however, agreed that the Court
cannot evaluate claims beyond those raised in the complaint.\102\ To
the extent that commenters read that opinion--and encourage this Court
to apply that opinion--in a way that would permit this Court to
evaluate legal theories, competitive effects, or claims that the United
States chose not to bring, it would violate the Constitution. The D.C.
Circuit recognized this fact in Microsoft when holding that district
courts are ``barred from reaching beyond the complaint to examine
practices the government did not challenge.'' \103\ Reading the Tunney
Act in a way that allows courts to second-guess the United States'
exercise of prosecutorial discretion would violate separation-of-powers
principles, and contravene the guidance that courts should ``not
construe [a] statute in a manner that renders it vulnerable to
constitutional challenge.'' \104\ Put directly, ``any agency with
limited resources and an investigative mission has the power, absent an
express statute to the contrary, to assess a complaint to determine
whether its resources are best spent on the violation, whether the
agency is likely to succeed, whether the enforcement requested fits the
organization's overall policies, and whether the agency has enough
resources to undertake the action.'' \105\ Thus, public comments that
criticize the Complaint for taking too narrow a scope or that point to
a broader set of practices that they also would have liked the
government to challenge have no bearing on the public interest inquiry
currently before the Court.
---------------------------------------------------------------------------
\100\ See supra Sec. III.
\101\ E.g., Economics Professors Comment (Exhibit 12) at 3; AAI
Comment (Exhibit 2) at 13.
\102\ United States v. CVS Health Corp., No. 18-2340, 2019 WL
4194925, at *5 (D.D.C. Sept. 4, 2019) (``Courts cannot, of course,
`force the government to make [a] claim.' The Government, alone,
chooses which causes of action to allege in its complaint.''
(citation omitted)).
\103\ Microsoft, 56 F.3d at 1460; see also Heckler v. Chaney,
470 U.S. 821, 832 (1985) (citing Article II, Section 3 of the
Constitution for the proposition that the decision about what claims
to bring ``has long been regarded as the special province of the
Executive Branch''); United States v. Fokker Servs., 818 F.3d 733,
738 (D.C. Cir. 2016) (recognizing the ``long-settled understandings
about the independence of the Executive with regard to charging
decisions).
\104\ Rothe Dev., Inc. v. U.S. Dep't of Def., 836 F.3d 57, 68
(D.C. Cir. 2016); cf. Maryland v. United States, 460 U.S. 1001,
1003-06 (1983) (Rehnquist, J., dissenting) (noting concerns about
the ability to formulate judicially manageable standards for the
Tunney Act inquiry).
\105\ Caldwell v. Kagan, 865 F. Supp. 2d 35, 44 (D.D.C. 2012).
---------------------------------------------------------------------------
For example, RWA and NTCH both express concern about the impact of
the merger on roaming services. RWA states that ``[t]he elimination of
Sprint and the entry of Dish will mean the nation will go without a
fourth wholesale or nationwide domestic roaming alternative to compete
against AT&T, Verizon, and New T-Mobile for an extended period of
time.'' \106\ Likewise, NTCH asserts that ``[t]he FCC has largely
ignored the growing crisis in the data roaming market,'' and alleges
that data roaming rates that exist today ``amount to a denial of
roaming service to [ ] small carriers and their subscribers in
violation of Sections 201(b) and 202(a) of the Communications Act of
1934, as amended.'' \107\
---------------------------------------------------------------------------
\106\ RWA Comment (Exhibit 24) at 11.
\107\ NTCH Comment (Exhibit 20) at 7-8.
---------------------------------------------------------------------------
The Complaint, however, does not allege that the merger will
eliminate competition in a market for roaming services, or that it will
impact roaming rates. RWA attempts to tie its concern to a paragraph in
the Complaint that pertains solely to the elimination of
``[c]ompetition between Sprint and T-Mobile to sell mobile wireless
service to MVNOs.'' \108\ This paragraph does not allege harm to rural
facilities-based mobile wireless carriers that purchase roaming
services. RWA and NTCH are free to advocate their positions on this
issue to the FCC, and both did so in this proceeding.\109\ Given that
these concerns are outside the scope of this proceeding, the Court
should not factor them into its public interest evaluation. For the
same reason, the Court should reject NTCH's proposed new conditions,
which it claims are designed to address these alleged harms.\110\
---------------------------------------------------------------------------
\108\ RWA Comment (Exhibit 24) at 11 (citing Complaint ] 22).
\109\ See FCC Order ] 297 (concluding that concerns raised by
RWA, NTCH, and others regarding the impact of the transaction on
roaming rates were adequately addressed by existing FCC
regulations).
\110\ NTCH Comment (Exhibit 20) at 16-20.
---------------------------------------------------------------------------
Similarly, Voqal--a coalition of 2.5 GHz spectrum licensees--claims
that the merger will cause T-Mobile's spectrum holdings to exceed a
``spectrum screen'' that has been
[[Page 61653]]
applied by the FCC in certain past merger reviews.\111\ They further
allege that New T-Mobile will have ``buyer market power in the 2.5 GHz
band.'' \112\ Voqal proposes new, self-designed divestitures of 2.5 GHz
spectrum that they claim would alleviate their concerns.\113\ The
question of whether and in what manner a regulatory ``spectrum screen''
should apply to this transaction is not before the Court.\114\
Moreover, the Complaint does not allege a relevant market consisting of
2.5 GHz spectrum, nor does it allege that the merger would cause T-
Mobile to acquire ``buyer market power'' in such a market.\115\ Thus,
the Court should not factor these claims into its public interest
determination, and it should reject Voqal's proposal for new
divestitures to be added to the proposed Final Judgment under
review.\116\
---------------------------------------------------------------------------
\111\ Voqal Comment (Exhibit 30) at 7-9.
\112\ Id. at 10.
\113\ Id. at 12-14.
\114\ This question was addressed directly by the FCC, which
found that, although its spectrum screen was triggered in much of
the nation, the transaction should be approved because of its
potential to increase spectrum utilization and accelerate the
deployment of 5G networks. See FCC Order ]] 97-99.
\115\ The FCC also declined to define such a market. See id. ]
64 (declining to ``define a separate product market for the sale or
lease of 2.5 GHz spectrum'').
\116\ Voqal proposes that T-Mobile be required to divest certain
2.5 GHz licenses because, it claims, no other spectrum bands are
sufficient substitutes for the deployment of 5G mobile wireless
services. See Voqal Comment at 6-7, 12-14. The FCC has rejected this
view and is actively working to make additional mid-band spectrum
available for 5G. FCC Order ]] 99, 110; see also In re Promoting
Investment in the 3550-3700 MHz Band, Notice of Proposed Rulemaking
and Order Terminating Petition, 32 FCC Rcd 8071, ] 2 (2017) (``[I]t
has become increasingly apparent that the 3.5 GHz Band will play a
significant role as one of the core mid-range bands for 5G network
deployments throughout the world. . . . In the two years since the
Commission first adopted rules for this `innovation band,' it has
authorized service in other bands that also will be critical to 5G
deployment, and we are currently evaluating additional bands for 5G
use.''); In re Expanding Flexible Use of the 3.7 to 4.2 GHz Band,
Order and Notice of Proposed Rulemaking, 33 FCC Rcd 6915, ] 1 (2018)
(``Today, we seek to identify potential opportunities for additional
terrestrial use--particularly for wireless broadband services--of
500 megahertz of mid-band spectrum between 3.7-4.2 GHz. . . .
Today's action is another step in the Commission's efforts to close
the digital divide by providing wireless broadband connectivity
across the nation and to secure U.S. leadership in the next
generation of wireless services, including fifth-generation (5G)
wireless, Internet of Things (IoT), and other advanced spectrum-
based services.'').
---------------------------------------------------------------------------
2. Comments Regarding Services Provided to MVNOs
The proposed Final Judgment requires the merged firm to extend T-
Mobile's and Sprint's existing MVNO agreements for the term of the
proposed Final Judgment, subject to certain conditions. Nevertheless,
the Economics Professors and others argue that this does not
sufficiently address potential harm that could arise from the loss of
competition between T-Mobile and Sprint in providing wholesale mobile
wireless services to MVNOs.\117\ They claim that future competition
between the firms could yield even better rates and terms than those in
the existing agreements, and that MVNOs will have no protection once
the proposed Final Judgment expires. Neither of these arguments
warrants finding that this portion of the proposed Final Judgment is
not in the public interest.
---------------------------------------------------------------------------
\117\ Economics Professors Comment (Exhibit 12) at 4, 9-11; see
also Wool Comment (Exhibit 32) at 3. As an initial matter, the
Economics Professors are incorrect in claiming that ``the DOJ's
Complaint spells out harms in two markets: The wholesale market and
the retail market.'' Economics Professors Comment (Exhibit 12) at 3.
The Complaint alleges only one relevant product market: the market
for retail mobile wireless services. See Complaint ] 14. The
Complaint does contain one paragraph alleging that ``competition
between Sprint and T-Mobile to sell mobile wireless service
wholesale to MVNOs has benefited consumers by furthering
innovation'' and that ``[t]he merger's elimination of this
competition likely would reduce future innovation.'' Complaint ] 22.
It does not, however, allege the existence of a distinct wholesale
market. To the extent that the concerns expressed by the Economics
Professors are premised on the existence of such a market, they are
outside the scope of the Complaint. See, e.g., Economics Professors
Comment (Exhibit 12) at 4 (calculating an HHI for ``the national
wholesale market'' and arguing that there is a ``presumption of
enhanced market power''). See also FCC Order ] 63 (declining to
define ``a separate product market for wholesale service
offerings'').
---------------------------------------------------------------------------
First, T-Mobile and Sprint have both been selling wholesale
services to MVNOs for many years, and the rates and terms in existing
MVNO agreements are what have resulted from this competition. These
terms will remain in place for the duration of the proposed Final
Judgment, and the commenters cite no support for their prediction that
maintaining this same level of competition would have yielded terms
that are better than these. Moreover, by increasing the capacity of T-
Mobile's network and reducing its cost of providing service to MVNOs
who need to compete against DISH, the merger and proposed Final
Judgment may combine to increase T-Mobile's incentive to provide
wholesale service to MVNOs.\118\ The Economics Professors fail to
account for this effect.\119\
---------------------------------------------------------------------------
\118\ See FCC Order ] 290 (``New T-Mobile's vastly increased
network capacity will likely give it incentives to offer appealing
terms and reasonable prices to wholesale service customers so as to
put that capacity to productive use by carrying as much revenue-
generating traffic as it can.'').
\119\ More generally, the Economics Professors Comment (Exhibit
12) is internally contradictory on the influence of MVNOs in the
marketplace. On the one hand, to attack the settlement the comment
dismisses any benefit from the divestitures that will stand DISH up
as an MVNO. Economics Professors Comment (Exhibit 12) at 2-3. Later,
in going on to attack the settlement for not doing more to help
MVNOs, the comment champions the competitive benefits that MVNOs
provide, including allowing carriers in effect to offer the same
service at different price points under a different brand, and
enabling cable companies to compete in wireless. Economics
Professors Comment (Exhibit 12) at 4. In fact, while observing that
by ``bundl[ing] wireless offerings with other products like
broadband and pay television, cable companies such as Comcast and
Charter have competed aggressively on price,'' id., the comments
overlook that this is precisely one of the benefits DISH will be
able to provide consumers. See Chris Welch, The Verge, ``Dish loses
more satellite TV customers as it embarks on a mobile future'' (July
29, 2019) (``Like other carriers, you can count on Dish combining
its video and mobile products. A Sling TV and Dish Mobile bundle is
all but guaranteed.''), https://www.theverge.com/2019/7/29/20746191/dish-q2-2019-earnings-mobile-carrier-plans-sling-tv-5g. The remedy
thus creates an innovative MVNO immediately, and further establishes
DISH as a likely future wholesale network provider.
---------------------------------------------------------------------------
Second, when the protections of the proposed Final Judgment expire,
MVNOs will not be limited to purchasing wholesale service from AT&T,
Verizon, or T-Mobile. By that point, DISH will have constructed a
mobile wireless network that could serve as an alternative host network
for MVNOs.\120\ Indeed, as a new entrant untethered to legacy business
models, DISH may be especially willing to partner with innovative
MVNOs. Thus, the Department believes that the proposed Final Judgment
provides sufficient protections to address the narrow wholesale-related
harm alleged in the Complaint.
---------------------------------------------------------------------------
\120\ See FCC Order ] 292 (explaining that the proposed Final
Judgment ``would enable DISH to emerge as a nationwide facilities-
based provider that would be capable of supplying, among other
things, robust wholesale wireless services to MVNOs.'').
---------------------------------------------------------------------------
3. Comments Regarding Other Regulatory Matters
NTCH claims that DISH could lose some of its wireless licenses in
the future, and if this were to occur, DISH would be unable to
construct a network that satisfies the provisions of the proposed Final
Judgment.\121\ It argues that DISH's licenses could be revoked for one
of two reasons, but neither provides a credible basis to reject the
decree.
---------------------------------------------------------------------------
\121\ NTCH Comment (Exhibit 20) at 11-15.
---------------------------------------------------------------------------
First, NTCH argues that ``it is possible that the FCC may deny''
DISH's request for an extension of the upcoming construction deadlines
for its AWS-4 and H Block licenses.\122\ NTCH argues that, in the event
of such a denial, DISH would likely fail to meet its future
construction deadlines for these licenses, which could result in
forfeiture of the licenses. The FCC, however, has
[[Page 61654]]
concluded that granting these extensions would be in the public
interest, and accordingly, has directed the relevant bureau of the
agency to do so.\123\
---------------------------------------------------------------------------
\122\ Id. at 11.
\123\ See FCC Order ] 365.
---------------------------------------------------------------------------
Second, NTCH contends that it might prevail in its pending appeals
of certain FCC orders that enabled DISH's purchase of the H Block
spectrum and granted DISH the ability to use the AWS-4 spectrum to
offer mobile wireless service.\124\ NTCH argues that ``reversal of the
FCC's license grants would doom this entire DISH-to-the-rescue plan to
failure.'' \125\ NTCH failed, however, in its opposition of these
orders at the FCC, and there is no reason to believe that NTCH will
prevail in its appeals. As the FCC and the United States have explained
in that litigation, NTCH lacks standing to bring several of these
challenges, and even if NTCH were found to have standing, its arguments
for why the FCC should not have adopted the orders at issue lack
merit.\126\ In any event, it would be improper for the Court to deny
entry of the proposed Final Judgment on the basis of a pending appeal
in a separate matter whose outcome is uncertain.
---------------------------------------------------------------------------
\124\ NTCH Comment (Exhibit 20) at 14-15.
\125\ Id. at 15.
\126\ See Corrected Brief for Respondent/Appellee and
Respondent, NTCH, Inc. v. Fed. Commc'ns Comm'n, Nos. 18-1241 & 18-
1242 (D.C. Cir. Mar. 28, 2019).
---------------------------------------------------------------------------
Separately, CWA argues that DISH is not fit to be a divestiture
buyer because of the existence of a dispute between DISH and the FCC
over a past spectrum auction.\127\ The referenced dispute arose from
the FCC's auction of so-called AWS-3 spectrum. In that auction, two
entities (Northstar and SNR Wireless) purchased spectrum licenses using
bidding credits intended for use by small businesses. The FCC
subsequently found that Northstar and SNR Wireless were ineligible for
the bidding credits they used because they were under the de facto
control of DISH and therefore were not small businesses. Accordingly,
the FCC revoked the credits and imposed a fine. After Northstar and SNR
Wireless appealed the FCC's order, the U.S. Court of Appeals for the
District of Columbia Circuit found that the FCC had reasonably
interpreted its rules but had not provided sufficient notice of its
interpretation.\128\ Thus, it ordered the FCC to provide Northstar and
SNR Wireless an opportunity to cure the violation by amending its
agreements with DISH.\129\ These efforts are ongoing. Significantly,
the D.C. Circuit went out of its way to note that the FCC's finding
that DISH exercised de facto control ``does not compel a finding that
the applicants lacked candor.'' \130\ It also emphasized that the FCC
explicitly said that SNR and Northstar appropriately disclosed their
relationships with DISH, that no other auction participant was harmed
by their conduct, and that no evidence showed that SNR and Northstar
``colluded with one another in violation of federal antitrust laws.''
\131\ Without wading into the merits of that ongoing matter, the United
States rejects CWA's contention that this should disqualify DISH from
being a divestiture buyer here.
---------------------------------------------------------------------------
\127\ CWA Comment (Exhibit 10) at 18-19.
\128\ See SNR Wireless LicenseCo, LLC v. Fed. Commc'ns Comm'n,
868 F.3d 1021, 1024-25 (D.C. Cir. 2017) (summarizing the background
of the case and the court's opinion). In discussing de facto
control, the D.C. Circuit noted that while ``the question of whether
one business exercises de jure control over another is binary, the
highly contextual question of de facto control is a matter of
degree.'' Id. at 1026.
\129\ Id. at 1043-46.
\130\ Id. at 1028.
\131\ Id.
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4. Other Negative Comments
CWA objects that the proposed Final Judgment ``uses open-ended,
vague and ambiguous language with reference to defendants' obligations
and/or the time within which certain actions must be taken,'' and that
such language is ``deeply problematic'' in a court order.\132\ Such
terminology, however, is not unusual and has been present in final
judgments previously approved under the Tunney Act.\133\ Moreover, the
Final Judgment minimizes any enforceability risks by providing for
resolution of any disputes that may arise without the need to involve
this Court. For example, if there is no agreement (regardless of the
reason), the monitoring trustee will report to the United States, and
the Department of Justice can resolve the dispute at its ``sole
discretion'' or at its sole discretion ``after consultation with the
affected Plaintiff States.'' \134\ Additionally, should any disputes be
brought before the Court, the Final Judgment provides standards for
resolving disputes over interpretation of any such terms. This is
accomplished both by reference to the purpose of the decree ``to give
full effect to the procompetitive purposes of the antitrust laws,'' and
by empowering the Court to enforce any provision of the Final Judgment,
as ``interpreted by the Court in light of these procompetitive
principles and in applying ordinary tools of interpretation,'' to terms
that are ``stated specifically and in reasonable detail, whether or not
[they are] clear and unambiguous on [their] face.'' \135\
---------------------------------------------------------------------------
\132\ CWA Comment (Exhibit 10) at 21, 22.
\133\ See, e.g., Final Judgment, United States v. Bayer AG, No.
18-cv-1241, at 19 (D.D.C. Feb. 08, 2019) (``The divestitures shall
be accomplished so as to satisfy the United States, in its sole
discretion, that none of the terms of any agreement between BASF and
Bayer and Monsanto give Bayer and Monsanto the ability unreasonably
to raise BASF's costs, to lower BASF's efficiency, or otherwise to
interfere in the ability of BASF to compete effectively.''); id. at
26 (``The terms and conditions of all agreements reached between
Bayer and BASF under Paragraph IV(G) must be acceptable to the
United States, in its sole discretion.''); id. (``Bayer shall
perform all duties and provide all services required of Bayer under
the agreements reached between Bayer and BASF under Paragraph
JV(G).''). See also US Airways Final Judgment at 12 (requiring
divestiture to be ``accomplished so as to satisfy the United States
in its sole discretion, in consultation with the Plaintiff States,
that none of the terms of any agreement between an Acquirer(s) and
Defendants gives Defendants the ability unreasonably to raise the
Acquirer's costs, to lower the Acquirer's efficiency, or otherwise
to interfere in the ability of the Acquirer(s) to effectively
compete.''); id. at 13 (``Defendants shall use their best efforts to
assist the Divestiture Trustee in accomplishing the required
divestiture.'').
\134\ See PFJ Sec. IV.A.4.
\135\ PFJ Sec. Section XVIII.B. Another commenter expressed
general opposition to the proposed remedy but did not provide a
sufficient basis for his concern to allow the United States to
respond. See Hasten Comment (Exhibit 15) (``No! No! No! No! No! You
don't need me to tell you the reasons why.'').
---------------------------------------------------------------------------
E. Comments Regarding Procedural Aspects of This Review
1. Sufficiency of the Filings
Mr. Bellemare argues that the ``materials published in the Federal
Register do not allow meaningful public comments.'' \136\ He asserts
that the United States was required to include additional information
in its filings, such as ``pre- and post-merger levels of concentration
(Herfindahl-Hirschman Index) (HHI); increase in HHI numbers as a result
of the merger; exact pre- and post- merger market shares of all
entities in the relevant market; trend toward concentration (or recent
acquisitions)'' as well as ``substantial information . . . on
regulatory or nonregulatory entry barriers in the relevant market.''
\137\ Mr. Bellemare does not identify a source for his claim that these
categories of information are required, and for good reason--neither
the Tunney Act itself nor the caselaw interpreting the Act identifies
such requirements. Under the Tunney Act, the United States must file a
Competitive Impact Statement that recites ``(1) the nature and purpose
of the proceeding; (2) a description of the practices or events giving
rise to the alleged violation of the antitrust laws; (3) an explanation
of the proposal for a consent judgment, including an explanation of any
unusual circumstances giving rise to such proposal or any provision
contained therein, relief to be obtained thereby,
[[Page 61655]]
and the anticipated effects on competition of such relief; (4) the
remedies available to potential private plaintiffs damaged by the
alleged violation in the event that such proposal for the consent
judgment is entered in such proceeding; (5) a description of the
procedures available for modification of such proposal; and (6) a
description and evaluation of alternatives to such proposal actually
considered by the United States.'' \138\ The Competitive Impact
Statement filed in this case amply satisfies these requirements.\139\
---------------------------------------------------------------------------
\136\ Bellemare Comment (Exhibit 6) at 1.
\137\ Bellemare Comment (Exhibit 6) at 7-8.
\138\ 15 U.S.C. 16(b)(1)-(6).
\139\ Mr. Bellemare also points to the standards that apply to
motions to dismiss and motions for summary judgment under the
Federal Rules. See Bellemare Comment (Exhibit 6) at 2, 8. Those
standards have no bearing on this proceeding.
---------------------------------------------------------------------------
2. Comments Regarding the Timing of This Review
Some commenters seek to delay this Court's proceedings until after
the conclusion of the litigation initiated by a group of state
attorneys general in the Southern District of New York (``S.D.N.Y.
Litigation''). AAI asks the Court to ``defer a public interest
determination and keep the public comment period open pending a final
judgment in the States' challenge to the proposed transaction.'' \140\
Similarly, Public Knowledge et al. ``request[s] that the DOJ ask the
court to wait to decide whether to accept its proposed consent decree
until the pending state enforcement action to block this merger is
resolved.'' \141\ These commenters assert that this approach would
impose no hardship on the merging parties and would be in the best
interests of both the Department and the public. They claim that this
approach would be appropriate because it would allow for a more
comprehensive public comment process and would promote the efficient
use of judicial resources. As discussed below (and in greater detail in
the United States's Response to States' Motion to File Brief as Amici
Curiae (``Response to States' Brief'') filed with this Court on October
23, 2019), AAI's assertions are incorrect.
---------------------------------------------------------------------------
\140\ AAI Comment (Exhibit 2) at 11.
\141\ Public Knowledge et al. Comment (Exhibit 22) at 4.
---------------------------------------------------------------------------
First, delay would prejudice the public interest, the Department,
and DISH. As the Department explained in its Response to States' Brief,
T-Mobile's obligation to begin preparing its network for DISH
subscribers is triggered by entry of the proposed Final Judgment.\142\
No useful purpose would be served by delaying this process and thus
delaying the date by which DISH can begin offering mobile wireless
service to the public. In addition, the Department has a broader
interest in ensuring that its proposed settlements are entered in an
efficient manner. Jeopardizing this ability would require the
Department to devote resources to matters it has decided to settle
rather than matters it has not.\143\ For its part, DISH has an interest
in prompt entry of the proposed Final Judgment because of its fixed-
date network deployment deadlines. The proposed Final Judgment requires
DISH to reach certain milestones by June 14, 2023, and delaying the
Court's consideration of the proposed Final Judgment would shorten the
time available to DISH to comply with this requirement.\144\
---------------------------------------------------------------------------
\142\ See PFJ Sec. IV.A.1; Response to States' Brief at 7-8.
\143\ See Microsoft, 56 F.3d at 1459 (noting in an appeal of a
Tunney Act decision that ``a settlement, particularly of a major
case, will allow the Department of Justice to reallocate necessarily
limited resources''); see also Heckler, 470 U.S. at 831 (explaining
that ``an agency's decision not to prosecute or enforce, whether
through civil or criminal process, is a decision generally committed
to an agency's absolute discretion'' because the agency must
consider, among other things, ``whether agency resources are best
spent on this violation or another'').
\144\ See PFJ Sec. VIII.A.
---------------------------------------------------------------------------
Second, contrary to these commenters' claims,\145\ the Court need
not allow third parties to file ``new or supplementary'' comments after
conclusion of the S.D.N.Y. Litigation. Much of the record developed in
the S.D.N.Y. Litigation will pertain to the merits of the states'
Section 7 challenge and thus will not be relevant here. Some of that
evidence will also pertain to legal claims that the United States did
not assert. Considering these claims would violate separation-of-powers
principles.\146\ Even as to evidence that could arguably be relevant,
the United States will not have participated in the creation of that
record, and it would violate fundamental principles of procedural
fairness to rely on such evidence.
---------------------------------------------------------------------------
\145\ AAI Comment (Exhibit 2) at 12-13.
\146\ See Heckler, 470 U.S. at 832 (noting that the decision
about which claims to bring ``has long been regarded as the special
province of the Executive Branch''); Microsoft, 56 F.3d at 1461
(noting that district courts engaging in Tunney Act review are
``barred from reaching beyond the complaint to examine practices the
government did not challenge'').
---------------------------------------------------------------------------
Third, adopting the proposed delay would not promote the efficient
use of judicial resources. When it passed the Tunney Act, Congress
expressed its intent for courts making public interest determinations
to ``adduce the necessary information through the least complicated and
least time-consuming means possible.'' \147\ Consistent with this
intent, courts routinely make Tunney Act determinations on the basis of
only the Competitive Impact Statement, comments filed by the public,
and the response filed by the Department.\148\ With the benefit of the
Department's Competitive Impact Statement in this proceeding, the
comments filed, and this response, the Court now has before it a record
sufficient to support a public interest determination.\149\
---------------------------------------------------------------------------
\147\ S. Rep. No. 93-298, at 6 (1973).
\148\ See supra Section III.
\149\ For this reason, the Court should also reject Public
Knowledge et al.'s unsupported request for an evidentiary hearing.
See Public Knowledge et al. Comment (Exhibit 22) at 4.
---------------------------------------------------------------------------
F. Comments Supporting Entry of the Proposed Final Judgment
Several commenters stated that although they believe the settlement
is unnecessary, they nevertheless endorse entry of the proposed Final
Judgment. Scott Wallsten of the Technology Policy Institute refers to
an earlier analysis he conducted that concluded the empirical evidence
was mixed as to whether 4-to-3 mergers ``necessarily harm'' consumers,
but that also ``identified areas in which the merger might pose some
concerns.'' \150\ Mr. Wallsten goes on to state that, ``[t]aken
together, the DOJ conditions address the concerns by aiming to lock in
existing MVNO agreements while lowering the barriers to entry by a
facilities-based carrier (DISH).'' \151\ Mr. Wallsten observes that
these conditions ``appear designed to reduce the chances of consumer
harm in the areas otherwise most likely to be affected while allowing
the New T-Mobile to retain sufficient assets to compete with AT&T and
Verizon.'' \152\ Mr. Wallsten states that these ``remedies lower the
barriers to DISH's entry into mobile cellular,'' and that ``[l]owering
the cost of entry also increases the chances DISH will enter the
market, thereby increasing competitive pressure on the New T-Mobile
(and other incumbents) from the threat of new entry.'' \153\ After
noting that, ``[f]or the longer run, the DOJ also proposes to reduce
barriers to entry into facilities-based provision for DISH,'' Mr.
Wallsten concludes that ``the conditions proposed by the DOJ are a
reasonable approach to managing potential concerns.'' \154\
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\150\ Wallsten Comment (Exhibit 25) at 1.
\151\ Id. at 1-2 (citing, inter alia, the divestiture of
Sprint's prepaid businesses, the MVNO agreement ``to ensure [DISH]
is able to sell a competitive mobile product,'' and the extension of
all current MVNO agreements).
\152\ Id.
\153\ Id. at 5.
\154\ Id. at 6.
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[[Page 61656]]
Similarly, Randolph May and Seth Cooper of the Free State
Foundation state that, while they ``do not specifically endorse or
oppose the proposed merger or the proposed settlement,'' they believe
there is ``strong evidence'' that the proposed merger, ``if approved
pursuant to the proposed settlement, would be in the public interest.''
\155\ And the Enterprise Wireless Alliance states that it supports the
merger because it ``would promote competition in the nationwide
commercial wireless marketplace and accelerate the deployment of a 5G
network covering much of the population including substantial
expansions in coverage to rural areas,'' and that it also ``supports
the introduction of DISH as a potential fourth national wireless
carrier'' through the consent decree.\156\
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\155\ May & Cooper Comment (Exhibit 23) at 1.
\156\ EWA Comment (Exhibit 13) at 1. Two additional commenters
explain that, after their initial concerns were satisfied by
negotiating additional relief directly with T-Mobile, they now also
support entry of the proposed Final Judgment. See California
Emerging Technology Fund Comment (Exhibit 8) at 1-2 (after becoming
a legal party in proceedings before the California Public Utilities
Commission and negotiating a Memorandum of Understanding ``that
provides unprecedented public benefits for California consumers,
especially the digitally-disadvantaged,'' states that the
``subsequent commitments secured by DOJ ensure that there is
increased competition and additional choices for all U.S.
consumers''); National Hispanic Caucus of State Legislators Comment
(Exhibit 18) at 1, 4 (after securing ``commitments regarding
deployment and hiring'' through an ``extensive Memorandum of
Understanding'' between T-Mobile and the National Diversity
Coalition, supports the DOJ's proposed settlement because it
``addresses some residual concerns we had previously identified'').
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A number of other commenters expressed support for the merger
generally, without specifically commenting on the settlement. For
example, several scholars affiliated with the International Center for
Law & Economics submitted a letter along with their recent report that
``reviews 18 empirical analyses in the last five years that study the
effects of changes in market concentration (such as by merger) in the
wireless telecommunications industry.'' \157\ These scholars express
the view that the divestiture package ``is likely unnecessary to ensure
that the market remains competitive.'' \158\ Nevertheless, and
``regardless'' of the proposed remedy, the scholars state that they
``believe that the DOJ was correct.'' \159\ The United States construes
these submissions \160\ as comments in favor of entry of the proposed
Final Judgment.
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\157\ ICLE Report at 2.
\158\ Id.
\159\ Id. at 1-2. Similarly, Tech Freedom filed ``comments in
support of the proposed Final Judgment and Stipulation and Order''
and ``urge[s] the Court to approve these Measures.'' TechFreedom
Letter (Exhibit 26) at 1 (also attaching ``Comments of TechFreedom''
filed with the FCC on Sept. 17, 2018). TechFreedom states that it
agrees with the analysis in the ICLE report discussed in the text
above, and that while it believes the remedy measures ``actually go
too far,'' it ``believes that the quickest path to bringing forth
the benefits of the merger is for the court to approve the merger as
agreed.'' Id. See also Competitive Enterprise Institute Comment
(Exhibit 11) at 1, 5, 7 (after stating the proposed merger ``more-
than passes muster'' under the DOJ/FTC horizontal merger deadlines,
discusses the benefits of T-Mobile's commitments to the FCC and
``respectfully encourage[s] DOJ to accept the proposed
settlement'').
\160\ See also National Puerto Rican Chamber of Commerce Comment
(Exhibit 19) (asking DOJ to ``approve the merger to help Puerto Rico
expedite its [hurricane] recovery and grow its economy''); Overland
Park Chamber of Commerce Comment (Exhibit 21) (``we support approval
of the proposed merger''); Vermont Telephone Co. Comment (Exhibit
28) (``Rural America has so much to gain from this [merger], and so
much to lose if it does not go forward''); Viaero Wireless Comment
(Exhibit 29) (the merger ``will directly benefit consumers and rural
carriers like Viaero''); Center for Individual Freedom Comment
(Exhibit 9) (CFIF and its supporters ``urge swift approval of the
proposed merger''); Greater Kansas City Chamber of Commerce Comment
(Exhibit 14) (writing to ``express the KC Chamber's support'' for
the merger); National Diversity Coalition Comment (Exhibit 17)
(stating it is ``one of many organizations that support the
merger''); Asian Business Association Comment (Exhibit 4) (stating
``our believe that this merger has the potential to greatly benefit
everyone in America''); Williamson Comment (Exhibit 31) (``I
strongly support the T-Mobile-Sprint merger and am hopeful that the
Department of Justice will approve the Merger.''); Americans for Tax
Reform Comment (Exhibit 3) at 1 (``I urge the Department of Justice
to approve the merger.''); CalAsian Chamber of Commerce Comment
(Exhibit 7) (``We have been outspoken in our support for the merger
of T-Mobile with Sprint . . . .''); Members of the United States
House of Representatives Comment (Exhibit 27) (Oct. 10, 2019 letter
resubmits ``in support of the proposed Final Judgment'' Jan. 25,
2019 letter sent to the FCC and the DOJ ``to express our support
for, and encourage your prompt consideration of, the proposed merger
of T-Mobile U.S., Inc. and Sprint Corporation.'').
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Other states besides the Co-Plaintiff States in this matter have
also indicated their support for the proposed Final Judgment. The
Attorneys General of Arizona and New Mexico have also expressed their
support for this settlement.\161\ The State of Mississippi went so far
as to withdraw from the S.D.N.Y. Litigation and enter an agreement with
T-Mobile that relies on the relief obtained by the FCC and in this
proposed Final Judgment.\162\ The State of Colorado has now also
withdrawn from the S.D.N.Y. Litigation and has requested to join as a
plaintiff in this action.\163\
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\161\ See ``Attorney General Brnovich Statement on DOJ-T-Mobile/
Sprint Merger Settlement'' (stating ``the divestiture, the FCC
commitments, and PFJ provide Dish the realistic ability to become a
competitive and fourth facilities-based wireless carrier'' and that
the PFJ ``also facilitates Dish's ability to exercise its option to
acquire the spectrum assets, cell sites, and retail assets to
establish itself as a viable competitor in the retail mobile
wireless services market''), available at https://www.azag.gov/press-release/attorney-general-brnovich-statement-doj-t-mobilesprint-merger-settlement; ``AG Balderas' Statement on the
Department of Justice's Announced Agreement on T-Mobile/Sprint
Merger,'' July 26, 2019 (the AG is ``pleased'' by the settlement),
available at https://www.nmag.gov/uploads/PressRelease/48737699ae174b30ac51a7eb286e661f/AG_Balderas%E2%80%99_Statement_on_the_Department_of_Justice%E2%80%99s_Announced_Agreement_on_T_mobileSprint_Merger.pdf.
\162\ See ``AG Hood Settles Concerns on T-Mobile-Sprint Merger,
Increases Services Available for Mississippians'' (Oct. 9, 2019),
available at https://www.ago.state.ms.us/releases/ag-hood-settles-concerns-on-t-mobile-sprint-merger-increases-services-available-for-mississippians/; Letter Agreement, ``T-Mobile and Sprint Pledged
Commitments in Mississippi'' (``Mississippi Letter Agreement'')
available at http://www.ago.state.ms.us/wp-content/uploads/2019/10/MS-T-Mobile-agreement-executed.pdf.
\163\ See Consent Motion for Leave to File Third Amended
Complaint (Oct. 28, 2019), Dkt. No. 40; see also ``Attorney
General's Office Secures 2,000 Jobs, Statewide 5G Network Deployment
Under Agreements with Dish, T-Mobile'' (Oct. 21, 2019), https://coag.gov/press-releases/attorney-generals-office-secures-2000-jobs-statewide-5g-network-deployment-under-agreements-with-dish-t-mobile-10-21-19/.
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Finally, the Attorneys General of Utah and Arkansas filed a comment
in this proceeding stating that they ``have studied--and agree with--
the conclusions in the DOJ's Competitive Impact Statement.'' \164\ In
their view, the proposed settlement ``contains a powerful divestiture
component'' and will ``greatly increase the probability that Dish will
become a successful and significant fourth competitor in the market.''
\165\ They conclude that ``the settlement embodied in the proposed
Final Judgment is in the public interest, mitigates the potential harms
that the merger could otherwise have created, and offers benefits to
rural communities while maximizing output and consumer choice for all
Americans.'' \166\
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\164\ Utah/Arkansas Comment (Exhibit 5) at 1.
\165\ Id. at 2 (citing the ``multifaceted and detailed nature''
of the Divestiture Assets, DISH's willingness to be bound as a
party, provisions allowing for DOJ and FCC verification, ``all
backed by the potential of significant monetary penalties for non-
compliance'').
\166\ Id. at 3.
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VI. Conclusion
After careful consideration of the public comments, the United
States continues to believe that the proposed Final Judgment, as
drafted, provides an effective and appropriate remedy for the antitrust
violations alleged in the Complaint, and is therefore in the public
interest. The United States will move this Court to enter the proposed
Final Judgment after the comments and this response are published as
required by 15 U.S.C. 16(d).
[[Page 61657]]
Dated: November 6, 2019.
Respectfully submitted,
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Frederick S. Young,
Matthew R. Jones,
U.S. Department of Justice Antitrust Division, 450 Fifth Street NW,
Suite 4100, Washington, DC 20530, (202) 307-2869,
[email protected].
[FR Doc. 2019-24642 Filed 11-12-19; 8:45 am]
BILLING CODE 4410-11-P
