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Speaker 1: Well, now it's time for our Bloomberg Law Brief, brought

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Speaker 1: to you by American Arbitration Association. Business disputes are inevitable,

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Speaker 1: in alternative dispute resolution for over ninety years, or at

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Speaker 1: a d R dot org. Let's get to the legal

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Speaker 1: stories we're watching this morning with Steve Potus in the

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Speaker 1: Bloomberg Washington newsroom. The draft House tax bill as written

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Speaker 1: runs up against a Senate budget rule that would require

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Speaker 1: either more government revenue or a cut in benefits directed

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Speaker 1: toward businesses and individuals. Both the Houston Astros and Los

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Speaker 1: Angeles Dodgers are entitled to a hefty bonus following the

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Speaker 1: World Series, but they come with hefty income taxes as well.

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Speaker 1: And Alphabet's Google unit has won a US order that

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Speaker 1: blocks a Canadian ruling that it delete global search results

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Speaker 1: from a seller offering goods allegedly made with stolen trade secrets.

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Speaker 1: Bloomberg Law everything you need, all on one legal research platform,

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Speaker 1: including guidance analysis and Bloomberg Market Intelligence. Fine up more

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Speaker 1: at Bloomberg law dot com. Now, in other legal news,

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Speaker 1: let's take a look at reports the US Justice Department

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Speaker 1: is actively considering a lawsuit to block a T and

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Speaker 1: T S planed purchase of Time Warner. For more in

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Speaker 1: the story, Bloomberg LA host doom Grosso and Michael Best

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Speaker 1: speak with Daniel Lyons, a professor at Boston College School

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Speaker 1: of Law. Dan, the Justice Department routinely prepares lawsuits to

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Speaker 1: block major deals even while it's negotiating settlements, and it's

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Speaker 1: rare for the d o J to litigate over a

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Speaker 1: vertical merger. So what's your analysis of the situation. Yeah,

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Speaker 1: I think that's right. Um. I think the surprising thing

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Speaker 1: here isn't that the Department of Justice is preparing the

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Speaker 1: lawsuits you said. I think that's sort of common practice. One,

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Speaker 1: it gives the Justice Department a little bit more leverage

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Speaker 1: in negotiating with a T and T, and two it's

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Speaker 1: the necessary precursor to filing a case UH in plan

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Speaker 1: be in case the deal winds up not going through.

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Speaker 1: That han't been said. I think the surprising thing here

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Speaker 1: is that the details leaked out to the public that

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Speaker 1: somebody had justices made a decision to UH issue the

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Speaker 1: to let this be known as a negotiating tactic. Or

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Speaker 1: for some other reason. Well, Daniel, why why would they

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Speaker 1: do that? Well? One reason is, UM, if the agreement

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Speaker 1: is actually stuck up on a handful of particulars, it

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Speaker 1: gives them a little bit of leverage by using the

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Speaker 1: bully pulpit right going out to the public and saying,

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Speaker 1: you know, if you don't come to UH agreement on this,

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Speaker 1: you don't gree to our terms, then we may wind

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Speaker 1: up going ahead with plan being filing a lawsuit UH

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Speaker 1: to extent that spooks investors, and it seems like it

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Speaker 1: may have given the stock price. It may cause the

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Speaker 1: company to give a little more than otherwise would Daniel?

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Speaker 1: What antitrust issues does this raise and can they be remedied?

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Speaker 1: So that's a really good question, right. Typically, when the

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Speaker 1: d o J is looking at a merger, it's something

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Speaker 1: like um, when Staples tried to apply Off tried to

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Speaker 1: buy Office Max. At a horizontal merger, where one company

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Speaker 1: is buying a competitor and the concern is that you're

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Speaker 1: reducing the number of choices, A vertical merger offers sort

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Speaker 1: of different issues because when a T and T purchases

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Speaker 1: Time Warners not removing a cable provider from the market. Rather,

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Speaker 1: it creates incentives for a T and T to leverage

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Speaker 1: strengthen one area programming to try to get an unfair

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Speaker 1: advantage over its competitors in the cable distribution space. The

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Speaker 1: real concern is that a T and T does something like,

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Speaker 1: for example, lock up HBO and say from now on,

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Speaker 1: if you want HBO, you can only get it if

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Speaker 1: you buy a T and TU Verse or um Direct TV.

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Speaker 1: And as Daniel Lyons, a professor at Boston College School

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Speaker 1: of Law, speaking at the Bloomberg's doing Grosso and Michael Best,

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Speaker 1: you can listen to Bloomberg Law weekdays at one pm

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