Antitrust Law Daily Wrap Up, ACQUISITIONS & MERGERS NEWS: FCC sets teams for AT&T/ DirecTV and Comcast/Time Warner/Charter merger reviews, (Jul 8, 2014)

By Lynn Stanton,TR Daily

Jamillia Ferris is joining the FCC’s Office of General Counsel to lead the team that will review the proposed combination of AT&T, Inc. and DirecTV, FCC Chairman Tom Wheeler announced yesterday. Ferris has been in private practice since leaving the Justice Department’s Antitrust Division last year, where she was chief of staff and counsel to the Assistant Attorney General in charge of antitrust.

Hillary Burchuk, formerly of the Justice Department’s Antitrust Division and currently a lawyer in the Hillary FCC’s Office of General Counsel, will lead the FCC’s review team for the proposed transactions involving combinations of Comcast Corp., Time Warner Cable, and Charter Communications, Inc.

Elizabeth Andrion of the FCC’s Office of Strategic Planning & Policy Analysis will be Ferris’s deputy on the AT&T-DirecTV review team. Bill Dever of the Wireline Competition Bureau will be Burchuk’s deputy on the Comcast-TWC-Charter review team.

FCC General Counsel Jonathan Sallet will chair the Commission steering committee that will oversee both reviews. Other members of the steering committee include Media Bureau Chief Bill Lake, International Bureau Chief Mindel de la Torre, Wireline Competition Bureau Chief Julie Veach, and Wireless Telecommunications Bureau Chief Roger Sherman.

Northwestern University economics professor William Rogerson will be the senior economist for reviews of both sets of proposed transactions. Northwestern management and strategy professor Shane Greenstein will be senior economic consultant for both reviews.

Bernstein Research Senior Analyst Paul de Sa, former chief of the FCC’s Office of Strategic Planning and Policy Analysis, said in a research note today that the Antitrust Division background of both FCC merger review team leaders "speaks to the degree of collaboration between the agencies that can be expected." He added that bringing in "two senior, external economists" will enable the Commission to "engage in vigorous debate with the parties’ retained experts on controversial issues, such as the geographical/product market definition in the proposed AT&T/DIRECTV transaction."

The analyst predicted that the FCC would soon start its self-imposed 180-day clocks for conducting the reviews, while emphasizing that given the other major issues on the FCC’s plate, the voluntary deadline "may not be met, particularly if a Sprint/T-Mobile merger is also attempted."

With regard to a potential Sprint/T-Mobile transaction, de Sa said that "[t]o the extent that today’s announcement supports our belief that merger reviews for the next two years are conducted in an antitrust-focused, economically-serious, collaborative manner, we think it emphasizes the need for Sprint to have the facts on their side if they want to get a merger with T-Mobile approved. Attempts to frame the merger either politically, via press leaks, or in terms of other issues (e.g., rural or fixed competition, promises to be disruptive, complaints about AT&T and Verizon, etc.) are unlikely to gain much traction."

"Today’s appointments do not change our view that the odds still favor both mergers winning approval," said Paul Gallant of Guggenheim Securities LLC. "But the appointments collectively do suggest both mergers will face very close scrutiny from two agencies that are likely to work seamlessly together."

He added, "we would also note that the FCC continues to hear concerns from consumers over its net neutrality proposal. Should that continue through a final FCC net neutrality ruling in late 2014, it has the potential to lead the FCC toward a more aggressive stance on the pending mergers."

News: AcquisitionsMergers Antitrust