The U.S. Justice Department filed a lawsuit against AT&T’s on Wednesday in which they claim that its DirecTV television unit was behind an illegal campaign to block companies from carrying Dodger broadcasts.
Via LA Times:
In a lawsuit filed Wednesday in federal court in Los Angeles, the Justice Department accused DirecTV of being a ringleader in an effort to make sure that three other pay-TV companies — Cox Communications, Charter Communications and AT&T (which was then separate from DirecTV) — would refuse to carry SportsNet LA, the Dodgers-owned TV channel.
The lawsuit alleges that the four companies engaged in illegal conduct, sharing nonpublic information among themselves, to gain bargaining leverage in negotiations with Time Warner Cable, which was struggling to get the pay TV companies to sign up for the channel.
DirecTV, now owned by AT&T, and Cox Communications have refused to carry the channel, citing its high cost.
AT&T says that is not the case, citing instead carriage fees.
“The reason why no other major TV provider chose to carry this content was that no one wanted to force all of their customers to pay the inflated prices that Time Warner Cable was demanding for a channel devoted solely to L.A. Dodgers baseball,” said David McAtee, AT&T general counsel. “We make our carriage decisions independently, legally and only after thorough negotiations with the content owner. We look forward to presenting these facts in court.”
The Justice Department does not agree.
“Dodgers fans were denied a fair competitive process when DirecTV orchestrated a series of information exchanges with direct competitors that ultimately made consumers less likely to be able to watch their hometown team,” Deputy Assistant Atty. Gen. Jonathan Sallet of the Justice Department’s antitrust division, said in a statement. “Competition, not collusion, best serves consumers and that is especially true when, as with pay-television providers, consumers have only a handful of choices in the marketplace.”
AT&T is currently attempting to purchase Time Warner Cable, a deal which many experts say will increase rates for customers as well as threaten innovation and freedom of information.
Gee, wonder where they would get an idea like that.