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By Drew FitzGerald
A federal judge told lawyers fighting over T-Mobile US Inc.'s more than $26 billion bid for Sprint Corp. to skip their customary opening arguments so they could start questioning witnesses, a sign he is seeking a speedy trial.
As the case began Monday, U.S. District Judge Victor Marrero asked both sides to trim their lists of witnesses to avoid beating him "over the head" with testimony. The bench trial is scheduled to carry into Christmas week but could last longer.
"What value do you see in opening statements in these circumstances?" Judge Marrero asked one of the attorneys representing T-Mobile.
Judge Marrero has heard high-profile cases dealing with President Trump's tax returns, the USA Patriot Act and hedge-fund manager Steven A. Cohen. His latest case will affect the structure of a wireless market that serves hundreds of millions of cellphone users.
A group of 14 attorneys general, led by New York and California, sued in June to stop the wireless deal, which would combine the country's third- and fourth-largest carriers by subscribers.
Federal antitrust and telecommunications officials approved the deal in July, saying the merger's shortcomings were addressed through concessions the officials required from T-Mobile and Sprint. Legal experts say it is unprecedented for the states to reject such a settlement and sue to block a merger of this size and national scope without the support or involvement of federal authorities.
Thirteen states and the District of Columbia decided to continue their litigation despite the Justice Department settlement, which required that Sprint divest itself of some assets to Dish Network Corp. to help build its fledgling wireless unit.
Some states later dropped out of the lawsuit and joined the Justice Department, though the core group of officials leading the lawsuit remained unmoved. They also recruited a few more states that hadn't initially joined the litigation.
California Deputy Attorney General Paula Blizzard said the solution the federal government devised didn't fix the problem and called Dish a struggling satellite-television company that lacks the wireless-industry experience to replace Sprint's position as a competitive force.
"We have yet to be shown how going from four competitors to three competitors would be good for consumers," California Attorney General Xavier Becerra said during a call with reporters before the trial.
T-Mobile and Sprint announced their merger proposal in April 2018 after several months of stop-and-start talks. T-Mobile is controlled by Deutsche Telekom AG, while Sprint is mostly owned by SoftBank Group Corp. of Japan.
The companies scrapped an earlier effort to join forces in 2014 after the Obama administration signaled its opposition to the deal.
The states' first witness, Sprint marketing chief Roger Solé, testified to the company's efforts to lure subscribers away from rivals, including T-Mobile.
The states also called Deutsche Telekom CEO Timotheus Höttges, who answered questions about how the German telecom giant turned a struggling U.S. subsidiary into the country's fastest growing competitor.
Glenn Pomerantz, a lawyer for the states, said T-Mobile's parent "dug into its pockets," plowed billions of dollars into the company's network, and turned around its performance -- a point the plaintiffs have highlighted to argue that Sprint and SoftBank could do the same if left to keep fending for themselves.
Mr. Höttges acknowledged his company's help, though he also said T-Mobile benefited from another key turn when AT&T Inc.'s planned takeover of the carrier collapsed in 2011. That setback armed T-Mobile with a $3 billion breakup fee, he said, the "real ignition" for its eight-year success story.
Write to Drew FitzGerald at email@example.com
(END) Dow Jones Newswires
December 09, 2019 17:11 ET (22:11 GMT)
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