Lawmakers question FCC’s T-Mobile/Sprint merger approval process

The lawmakers asked FCC Chairman Ajit Pai to respond by January 6. (Getty Images)

U.S. lawmakers are pressing FCC Chairman Ajit Pai for answers over concerns that the agency’s approval process for the pending T-Mobile/Sprint merger was flawed and lacked transparency.

In a letter (PDF) sent Monday to Pai, House Energy and Commerce Committee Chairman Frank Pallone, Jr. (D-NJ), and Judiciary Committee Chairman Jerrold Nadler (D-NY) wrote, “We are particularly concerned that the underlying analysis drafted by the merger task force based on the evidence submitted into the docket was altered by the Commissioners and replaced with an analysis that downplays the competitive harms of the merger.”

They pointed to procedural issues raised by Democratic FCC Commissioner Jessica Rosenworcel, who cast a dissenting vote against merger approval in October, and previously called the review process “bonkers.” Fellow Democratic Commissioner Geoffrey Starks also voted against merger approval.

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In her dissenting statement (PDF) Rosenworcel claimed that key parts of analysis were rewritten by the FCC’s political leadership “in the eleventh hour and behind closed doors,” and swapped underlying data “with more merger-friendly data supplied by T-Mobile.”

RELATED: Judge asks Legere why Sprint can’t do a turnaround like T-Mobile

T-Mobile and Sprint are currently in the midst of week two of their antitrust trial, fighting against a coalition of state attorneys general led by New York and California, who sued to block the deal claiming harms to competition. The remaining state AGs are all Democrats, as Texas; the suit’s lone Republican state reached a settlement with T-Mobile and dropped the lawsuit prior to trial.

The FCC formally approved the merger in October after the U.S. Department of Justice previously reached a consent decree that, among other concessions, included deals to help set up Dish Network as a fourth wireless carrier via spectrum and prepaid divestitures and an MVNO agreement. Dish’s Charlie Ergen, who was initially opposed to the T-Mobile/Sprint tie up, is expected to testify today at the trial.

While the Sprint/T-Mobile merger proceeding had long been open to public comment prior, the agency opted not to provide an additional comment period related to the Dish agreements, something the congressmen took issue within their letter to Pai. Notably, related to the asset purchase, Dish also made new commitments to the FCC that require modifications to its spectrum license build out requirements.

RELATED: Analysts anticipate Dish’s Ergen testimony as T-Mobile/Sprint trial heads into Week 2

“In addition, the failure to seek additional public comment after the parties entered into a consent decree with the Department of Justice raises additional procedural concerns,” continued Pallone and Nadler.

Specifically, they pointed to 25 ex parte conversations between T-Mobile representatives and FCC Commissioners, which parties like the Rural Wireless Association alleged didn’t comply with the agency’s own rules. Pallone and Nadler indicated the substance of those communications wasn’t adequately disclosed, calling the descriptions “devoid of arguments.” They noted many of the flings only included a list of the subjects discussed, running counter “to the letter and spirit of the FCC’s ex parte rules.”

“Simply from a public policy perspective, permitting the parties to provide such scant reporting in the record is a gross abrogation of FCC responsibility, and undermines the critical transparency that is a necessary part of this process,” they continued.

The letter asks Pai to respond to the following questions and information requests by Jan. 6:

  • "Did the FCC seek the opinion of the Office of General Counsel regarding the possible need to provide the public with an additional comment period after the DoJ announced its consent decree, yes or no? If so, please provide all communications during the pendency of the FCC’s merger review—covered by the Federal Records Act—between officials at the FCC regarding the need to seek an additional comment period regarding the merger review."
     
  • "Is the FCC investigating T-Mobile’s compliance with the ex parte rules, yes or no? If so, when does the FCC expect to complete the investigation? If not, does the FCC plan to open an investigation, yes or no?"
     
  • "Provide all drafts of the merger order, including the draft originally circulated to the Commissioners, and each subsequent draft."

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