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Time Warner's Jeff Bewkes and AT&T's Randall Stephenson before testifying about the deal. Photo: Evan Vucci / AP

If the U.S. Justice Department were to sue over its demands that AT&T sell Turner (owner of CNN and other channels) or DirecTV in order to have its $85 billion purchase of Time Warner approved, as reported Wednesday, lawyers say the regulators will be fighting decades of precedent.

Why it matters: Speculation is swirling about the DOJ's motives, in light of President Trump's campaign trail promise to block the deal, and his vocal disdain for CNN's coverage.

Theory of the case: Critics of the proposed AT&T-Time Warner merger argue that a combination of companies in different but related markets (i.e., a vertical deal) can be as harmful as a horizontal combination of two companies that compete directly with one another.

  • Asking AT&T to sell either DirecTV or Turner could be based on the idea that owning both a major content producer (particularly in sports and news) and a nationwide video provider would enable the combined entity to push competitors around.
  • For example, AT&T+Time Warner could provide free data for customers to watch certain content (a.k.a. "zero rating"). Currently, AT&T customers using the DirecTV Now streaming service can watch most programs without eating into their monthly data allotment. Zero-rating has been one recent focus in the DOJ's evaluation of the case. A source familiar with the matter says that the agency has looked into the effect that DirecTV Now has on DirecTV's broader customer base.

Where it gets complicated: For decades, antitrust regulators have worried more about horizontal mergers than vertical ones, and courts have generally backed up that approach.

  • They'd also be bucking the status quo on another front. If antitrust enforcers have concerns about a deal, they typically ask the companies to commit to not engaging in certain actions. Asking the companies to sell off the parts of their business that could cause trouble for competitors, as the DOJ is considering, is more unusual.
  • AT&T's CEO said he doesn't plan to sell CNN and a Justice spokesperson said the agency doesn't comment on ongoing investigations.

The bottom line: The transaction is unexpectedly imperiled and may head into uncharted territory, were it to spark a lawsuit over over the right way to police competition.

Go deeper: The New York Times has a rundown of the different stories emerging from Ma Bell and DOJ.

Go deeper

White House nominates Rick Spinrad as NOAA leader

In this NOAA GOES-East satellite handout image, Hurricane Dorian, a Cat. 4 storm, moves slowly past Grand Bahama Island on September 2, 2019. (Photo by NOAA via Getty Images)

The White House on Thursday evening nominated Rick Spinrad, an oceanographer at Oregon State University, to head the National Oceanic and Atmospheric Administration (NOAA).

Why it matters: Filling the NOAA slot would complete the Biden administration's leadership on the climate and environment team. The agency, located within the Commerce Department, houses the National Weather Service and conducts much of the nation's climate science research.

2 hours ago - World

Israeli officials will object to restoration of Iran deal in D.C. visit

Photo: Anadolu Agency / Getty Images

Israeli Prime Minister Benjamin Netanyahu has instructed the delegation traveling to Washington, D.C. next week for strategic talks on Iran to stress their objection to a U.S. return to the 2015 nuclear deal and to refuse to discuss its contents, Israeli officials say.

Why it matters: That position is similar to the one Israel took in the year before the 2015 nuclear deal was announced, which led to a rift between the Israeli government and the Obama administration. History could now repeat itself.

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Brendan Lynch/Axios

  1. Health: Coronavirus cases aren't budging — even after vaccinations doubled— Health care workers feel stress, burnout more than a year into the pandemic — Handful of "breakthrough" COVID cases occurred in nursing homes, CDC says.
  2. Vaccines: Johnson & Johnson's vaccine production problems look even bigger — All U.S. adults now eligible for COVID-19 vaccine.
  3. Political: Watchdog says agency infighting increased health and safety risks at start of pandemic.
  4. World: EU regulator: Benefits of J&J vaccine outweigh risk of rare blood clots.
  5. Variant tracker: Where different strains are spreading.