“In economics, it is generally accepted that an increase in the cost of providing a good (whether increased opportunity costs or otherwise) will ordinarily cause a provider to demand more compensation for the good and increase the price as a result,” they wrote in their brief. They said that Leon rejected that principle when it came to the Justice Department’s claim that Time Warner’s Turner channels would charge higher rates to AT&T’s distribution rivals. But they say that contradicts Leon’s acceptance of AT&T’s claim that digital competition had decreased ad revenue and forced it to charge higher distribution fees.

The DOJ argued that the incentives of the Turner channels would change once it was owned by AT&T, which also owns distributor DirecTV.

Leon rejected that argument and the economic theory that companies will act to maximize profits of the company as a whole, ACA and Rogerson contend. But Leon also assumed that AT&T would “maximize its profits as a whole” when it came to assessing the efficiencies that would be gained by the merger.