## Facts

- AT&T (then the second-largest U.S. mobile wireless carrier) agreed to acquire T-Mobile (then the fourth-largest).
- Sprint (a national carrier) and Cellular South (regional carriers) filed private suits seeking to enjoin the transaction under § 16 of the Clayton Act, alleging the merger would violate § 7 by substantially lessening competition.
- Plaintiffs alleged the merger would increase concentration, strengthen AT&T’s market power, and lead to higher prices, reduced output, and reduced innovation in retail mobile wireless markets.
- Plaintiffs also alleged direct harms to them as rivals and purchasers of inputs, including higher costs or worse terms for roaming, backhaul, and other upstream services.
- Plaintiffs emphasized handset access as a competitive input, alleging large carriers used exclusive or preferential device arrangements and that greater post-merger share would increase AT&T’s leverage to restrict rivals’ access to innovative handsets.
- Plaintiffs supported the handset theory with concrete allegations of past exclusion or unfavorable terms for in-demand devices.
- The United States and several states separately sued to block the same merger; defendants moved to dismiss the private suits under Rules 12(b)(1) and 12(b)(6), arguing lack of antitrust standing and failure to state a claim.

## Issues

1. Whether Sprint and Cellular South sufficiently alleged “antitrust injury” and satisfied prudential antitrust-standing requirements to seek injunctive relief under Clayton Act § 16 for a threatened § 7 violation.
2. Whether plaintiffs’ asserted injury theories were too remote, speculative, derivative of consumer harm, or otherwise unsuitable given ongoing government enforcement.

## Decision

- The court granted the motion to dismiss in part and denied it in part.
- The court held competitor carriers may be proper plaintiffs under § 16 when they allege threatened harms that are direct, non-speculative, and of the type the antitrust laws are designed to prevent.
- The court allowed claims to proceed to the extent they alleged direct injuries tied to the merger’s likely anticompetitive effects, including plausible input-market and handset-access harms.
- The court dismissed theories deemed too attenuated, speculative, or insufficiently tied to the alleged lessening of competition.

## Legal Principles

- Clayton Act § 16 authorizes injunctive relief for “threatened loss or damage” from an antitrust violation and applies a less demanding showing of injury and causation than damages actions under § 4, but it still requires antitrust standing.
- “Antitrust injury” requires harm of the type the antitrust laws were intended to prevent and that flows from the aspect of the challenged conduct that makes it unlawful.
- Prudential antitrust standing turns on factors including directness of injury, existence of more direct victims, and administrability concerns such as duplication and efficient enforcement.
- Competitor status does not bar standing; the key question is whether the alleged harm reflects reduced competition rather than ordinary rivalry effects.
- The existence of parallel government merger litigation is relevant but not a categorical bar to private § 16 suits, particularly where plaintiffs plead competitor-specific threatened harms.

## Conclusion

The court permitted Sprint’s and Cellular South’s merger challenge to proceed on narrowed theories, holding that competitors can obtain § 16 injunctive standing when they plausibly allege direct, non-speculative threatened injuries—such as degraded access to key inputs and handsets—flowing from a merger’s likely reduction of competition, while dismissing more remote or speculative claims.


Sprint Nextel Corp. v. AT&T Inc., 821 F. Supp. 2d 308 (D.D.C. 2011)