US gov’t sues AT&T/DirecTV, calls it “ringleader” of collusion scheme

From ArsTechnica:

The Department of Justice today sued DirecTV and its owner, AT&T, saying the satellite TV company colluded with competitors during contentious negotiations to broadcast Los Angeles Dodgers games.

Dodgers games have been blacked out in much of Los Angeles because pay-TV providers have been unwilling to pay the price demanded by SportsNet LA, the Dodgers channel operated by the baseball franchise and Time Warner Cable. But the DOJ’s antitrust division placed the blame for this situation on AT&T and DirecTV. In a complaint filed in US District Court in California, it alleges that DirecTV was a ”ringleader” in a coordinated scheme with cable companies Cox and Charter, according to a DOJ announcement.

“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 Attorney General Jonathan Sallet said in the DOJ announcement. The lack of a competitive negotiation process is especially bad for consumers in a market like cable television, where customers have ”only a handful of choices,” he said.

AT&T completed its purchase of DirecTV in July 2015, but the complaint covers a dispute that began before the merger and continues to this day. The Dodgers channel owners offered carriage licenses to the pay-TV companies in January 2014, but the channel is still not available on DirecTV, Cox, or AT&T’s wireline TV service. (Games are now available on Charter, which purchased Time Warner Cable this year.)

The lawsuit “alleges that DirecTV unlawfully exchanged competitively-sensitive information with Cox, Charter, and AT&T during the companies’ negotiations for the right to telecast the Dodgers Channel,” the DOJ announcement said. “Specifically, the complaint alleges that DirecTV and each of these competitors agreed …

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