Cellular South sues to block AT&T deal

Cellular South, a Mississippi-based wireless carrier, filed suit Monday to block the merger of its national rivals AT&T and T-Mobile.

The move comes after the Justice Department, seven states and Sprint have all sued to stop the $39 billion deal.

 The lawsuits allege the merger between the second and fourth largest wireless carriers would violate antitrust laws by stifling competition in the wireless market.

In its complaint, Cellular South argued the merger will threaten "the very existence of the regional carriers and will diminish the competition they provide."

The complaint notes that small regional carriers such as Cellular South rely on the national carriers to allow their customers to roam to areas they do not primarily serve.

Reducing the number of national carriers would increase roaming charges for the regional carriers, threatening the ability of the regional carriers to compete, according to the lawsuit.

"Cellular South and the other regional carriers will be forced to pay higher roaming prices from the Big Two (AT&T and Verizon) — assuming that that they are able to obtain roaming agreements at all," Cellular South wrote in the complaint.

A spokesman for AT&T declined to comment directly on the Cellular South suit but pointed to AT&T's statement when Sprint filed its suit. At the time, AT&T argued the merger would improve wireless service and create thousands of jobs. 

Sprint applauded Cellular South for suing its rivals. 

 "As this growing chorus of opposition shows, this proposed transaction violates antitrust law and is not in the best interests of consumers and the American economy,” Vonya McCann, Sprint’s senior vice president of government affairs, said in a statement.

Public Knowledge, an advocacy group that opposes the merger, also cheered news of the latest legal challenge.

"Cellular South has just shattered the myth that AT&T's takeover of T-Mobile will be good for rural America," said Gigi Sohn, president of Public Knowledge. "Their complaint demonstrates how customers in rural areas would be put at an even more severe disadvantage should the deal go through, through higher roaming rates, less access to devices and an overall incentive and ability to exclude competitors."