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AT&T's $85.4 billion bid to acquisition Time Warner is in jeopardy as reports on Monday claim the U.S. Department of Justice is set to file a lawsuit aimed at blocking the high-profile merger.
Earlier today, the Justice Department said it will make an announcement regarding a "major antitrust matter," news that several media outlets linked to AT&T's merger with Time Warner. Bloomberg, citing unnamed sources, was first to report on the coming coming lawsuit, followed by Politico and Reuters.
AT&T later confirmed the suit to CNBC, but failed to detail the Justice Department's legal action.
Announced over a year ago, AT&T's takeover of Time Warner has come under fire for what some view as a contentious consolidation of power. AT&T, a "big four" American telecommunications powerhouse, operates a wide array of phone, internet and TV businesses, while Time Warner owns big cable brands including HBO, CNN, TBS and the Cartoon Network.
Time Warner's proprietorship of CNN is at the heart of at least one theory regarding the Justice Department's unconventional move. In its report on the matter, CNN notes President Trump vowed to block the deal during his campaign, and has consistently taken to Twitter to criticize the news network for disseminating "fake news." Those tweets continue, the latest coming last week, in what CNN says could constitute evidence of presidential interference.
For its part, AT&T has been preparing for a legal scrum with the DOJ, the sole entity capable of blocking the takeover after FCC chairman Ajit Pai said his commission would not review the merger earlier this year. Last week, AT&T CEO Randall Stephenson said his company would seek an expedited hearing if met with a DOJ challenge.
Prior to the merger announcement last year, Apple was rumored to have held preliminary talks with Time Warner over a potential tie-up, but those discussions failed to bear fruit. Still, with fingers in content streaming, Apple reportedly closely monitored AT&T's moves in the lead-up to its $85.4 billion agreement with Time Warner.