In a major antitrust move, the Justice Department has accused DirecTV, now owned by AT&T, of colluding with other TV companies to keep Dodgers games off TV in Los Angeles.
According to a complaint filed by the department, DirecTV met with Cox, Charter, and AT&T, and made a concerted effort to keep the channel SportsNet LA unavailable to customers. This, the department alleges, was done in a bid to improve negotiations with Time Warner Cable, a rival that owned the exclusive rights to the channel and was planning to sell rights to carry the channel to the other companies.
In one communication cited by the department, DirecTV CEO Mike White allegedly told the company’s chief content officer that the companies “may have more leverage if we all stick together.”
“As the complaint explains, 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 a statement.
As AT&T was one of the companies allegedly involved in the collusion with DirecTV, the incident happened well before the company’s takeover of the TV provider in 2015. “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 LA Dodgers baseball,” AT&T said in a statement.
Meanwhile, AT&T will face additional Justice Department scrutiny as it attempts to purchase Time Warner for $85 billion, a deal that must be approved by the department. While that deal is separate, the lawsuit certainly isn’t ideal news for AT&T as the proposed merger is reviewed.