Law Firm Tries to Kill Merger With 1,000 Small Cases

By Wayne Rash  |  Posted 2011-07-25 Print this article Print


Will Bursor & Fisher block the merger? Probably not right away. After all, AT&T has spent millions of dollars in the second quarter alone lobbying Congress and the FCC to make sure it goes forward. This is on top of the millions of dollars it has paid to induce various organizations to write the FCC in support of the merger. Surely, AT&T isn't going to give up the fight just because some feisty law firm tries something new. It's going to fight tenaciously in court, and the Bursor & Fisher gambit could fail.

The problem for AT&T is that the company has faced Bursor & Fisher before. It lost. In fact, AT&T has a history of losing when it comes up against these folks, so you have to wonder if they're on to something. Perhaps AT&T has sown the seeds of its own undoing in the way it structured its user agreements? Or perhaps not. As I've mentioned in this space before, I'm not a lawyer. But the people representing AT&T are lawyers, and they've been wrong before.

The way this plan would work is that each customer (represented by the law firm) would demand that AT&T cease and desist. When AT&T doesn't (which is basically a sure thing), then the customer would request arbitration with the American Arbitration Association, along with providing evidence to support it. Once that's done, Bursor & Fisher may demand that AT&T fork over the ten grand. They could also seek a larger settlement on your behalf.

It's an open question whether this will actually work. Getting arbitrators to see things your way can certainly seem like a roll of the dice at times. But if Bursor & Fisher starts getting cases brought before arbiters, and payments of $10,000 start to be ordered, it's likely that AT&T will start to take notice. While ten grand is chump change to AT&T, after a while they start to build up to millions of dollars if enough cases are won. After awhile this could be enough to pay for all of those cell sites that AT&T claims it can't build as a reason it must buy T-Mobile. Now that's serious money.

But will it stop the merger? Maybe not. AT&T has a lot of lawyers and a lot of money. It also has its heart set on getting back to that good ol' monopoly it enjoyed  back before the Justice Department went and ruined everything. Life is good in a monopoly, at least if you're the monopolist. And I suppose AT&T wants that good life back again.  

Wayne Rash Wayne Rash is a Senior Analyst for eWEEK Labs and runs the magazineÔÇÖs Washington Bureau. Prior to joining eWEEK as a Senior Writer on wireless technology, he was a Senior Contributing Editor and previously a Senior Analyst in the InfoWorld Test Center. He was also a reviewer for Federal Computer Week and Information Security Magazine. Previously, he ran the reviews and events departments at CMP's InternetWeek.

He is a retired naval officer, a former principal at American Management Systems and a long-time columnist for Byte Magazine. He is a regular contributor to Plane & Pilot Magazine and The Washington Post.

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