Senior U.S. District Judge Richard J. Leon told Justice Department attorneys today that he won’t be allowing “any PowerPoints in” as evidence in the department antitrust challenge to AT&T, Inc.’s proposed merger with Time Warner, Inc., “unless I know who authored it, at whose direction, [and] for what purpose.”
During the first of two days of expected discussion of objections to proposed evidence before opening arguments are planned in the case on Wednesday, Judge Leon compared PowerPoint presentations and “slide decks” attached to company e-mails that the Justice Department wants to submit as evidence to “water cooler chatter” in the days before e-mail.
In “U.S. v. AT&T, Inc., et al.” (case 1:17-cv2511-RJL), the Justice Department is challenging a vertical merger for the first time in decades. In addition to company e-mails that the government wants to submit as evidence, it also wants to present public filings, including filings in previous merger and non-merger proceedings, in which AT&T and Directv — before its acquisition by AT&T — argued that the integration of programming and distribution could harm consumers and competition.
Company attorneys argued that statements by Directv prior to its acquisition by AT&T cannot be attributed to AT&T now, and that Directv should not even be a defendant in the current proceeding, since, as a subsidiary of AT&T, it would not be a party to the proposed transaction.
Judge Leon began today’s proceedings by saying that he wanted to discuss “evidentiary matters” so that the parties would have “an idea of what will be coming in” as evidence and can adjust their opening arguments “accordingly.”
He also said that while he hoped the trial could be wrapped up in four to six weeks, “it looks like it may be more like six to eight weeks.”
Judge Leon said he sees “two overarching issues” raised in objections to proposed exhibits — primarily defense objections to proposed government exhibits — which are concerns about whether e-mails and other documents qualify as business records for the purpose of an exception to the rule against hearsay evidence and objections over lack of relevance.
“The mere fact that something is an e-mail made on a business computer doesn’t necessarily them business records,” Judge Leon noted, saying that the courts are fairly consistent on this point. “I’ve already indicated I’m not inclined to let e-mails come in unless we have a sender or receiver to attest to context,” he said.
The defense said it would have few objections to the proposed government exhibits if witnesses are present to ask about the e-mails, rather than leaving the documents to be viewed by the court after the trial concludes, “behind closed doors without a witness to explain it to your honor.”
The defense also noted that e-mails could have “embedded” hearsay from third parties — that is, statements attributed to someone other than the sender — but that it was willing to entrust it to Judge Leon not to treat such statements “as truth.”
Regarding the “decks of slides attached to e-mails,” Judge Leon said that “often you can’t tell” whether the author of the e-mail is also the author of the slides. “It would be very helpful for me to know that,” he said.
Judge Leon also questioned whether an argument or recommendation in an e-mail could be viewed as a business record, without knowing whether it was acted on or even whether made it up the chain of command to someone who could act on it. The government argued that the e-mail participants included “vice presidents and presidents of the companies.”
With regard to filings by Directv and AT&T in previous FCC proceedings, the defense noted that some of the filings include expert reports, which would not be allowed to stand on their own in the context of AT&T-TWI proceeding without the experts to testify on them.
The defense also argued that what is relevant “is not advocacy in these prior cases, but what happened after the transactions … in the markets.” Defense argued that allowing such filings into evidence would lead to “undue consumption of time” and “exposure” of the court “to material that may be prejudicial.”
Judge Leon asked the Justice Department whether it had named Directv as a defendant just so it could get the Directv filings into evidence.
“They were named because they’re a player in a market relevant” to the vertical integration presented by the transaction, a Justice Department attorney said.
Judge Leon advised the Justice Department attorneys, “You must distinguish between what you want and what you need. Is it maybe more trouble than it’s worth?”
Singling out a Directv filing that included an expert report on, and support for, use of a bargaining model in assessing a vertical merger, Judge Leon said, “As far as that particular exhibit, I’m not inclined to allow it with respect to any party other than Directv. With regard to expert reports, I’m not inclined to allow them. I’ll give it a little more thought, but I’m not inclined to allow them, even with respect to Directv.”
Regarding a proposed exhibit that included a Google, Inc., presentation, which the defense objected to as hearsay and lacking relevance, Judge Leon said that he would want to have the Google official who authored it present to testify. The government said that the Google official has been deposed. —Lynn Stanton, [email protected]
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