US Settles Claim Against AT&T, DIRECTV On Sharing Deals With Competitors

(RTTNews) - The U.S. Department of Justice said that it has reached a settlement that will prohibit DIRECTV and its parent corporation, AT&T Inc. (T), from illegally sharing confidential, forward-looking information with competitors.

The department's Antitrust Division filed suit on November 2, 2016, alleging that DIRECTV was the ringleader of a series of unlawful information exchanges between DIRECTV and three of its competitors - Cox Communications Inc., Charter Communications Inc. and AT&T (before it acquired DIRECTV) - during the companies' negotiations to carry the SportsNet LA "Dodgers Channel." SportsNet LA holds the exclusive rights to telecast almost all live Dodgers games in the Los Angeles area.

The Justice noted that the settlement will ensure that when DIRECTV and AT&T negotiate with providers of video programming, including negotiations to telecast the Dodgers Channel, they will not illegally share competitively-sensitive information with their rivals. The settlement also requires the companies to monitor certain communications their programming executives have with their rivals, and to implement antitrust training and compliance programs.

According to the Complaint, DIRECTV's Chief Content Officer, Daniel York, unlawfully exchanged competitively-sensitive information with his counterparts at Cox, Charter and AT&T while they were each negotiating for the right to telecast the Dodgers Channel. The companies engaged in these unlawful information exchanges to decrease the risk that any individual company would lose subscribers by not carrying the Dodgers Channel while others did. Eliminating this threat corrupted the competitive bargaining process and likely contributed to the lengthy blackout.

The proposed settlement agreement, along with the department's competitive impact statement, will be published in the Federal Register as required by the Antitrust Penalties and Procedures Act. Any person may submit written comments concerning the proposed settlement within 60 days of its publication. At the conclusion of the 60-day comment period, the court may enter the final judgment upon finding that it serves the public interest.