AT&T subsidiary DirecTV asks to be dropped from antitrust case

By Diane Bartz

WASHINGTON (Reuters) - DirecTV, the biggest U.S. pay TV company and a subsidiary of AT&T, asked a federal court on Tuesday to drop it from the lawsuit that the government filed to stop AT&T from buying movie and TV production company Time Warner.

"DIRECTV is not the seller, the acquired entity, or a major stockholder of the acquirer," lawyers for the company said in a filing.

In its request, DirecTV alleged that the Justice Department included the company as a defendant so it could use critical statements its executives made about the 2011 merger of Comcast and NBCU as part of the government's argument against the AT&T/Time Warner deal. AT&T bought DirecTV in 2015.

Both instances involve a big pay TV distributor buying a movie and TV production company.

In its complaint filed against the merger in November, the Justice Department said DirecTV previously warned that mergers of TV distributors and content makers "can much more credibly threaten to withhold programming from rival (distributors)" and can "use such threats to demand higher prices and more favorable terms."

DirecTV has nearly 21 million subscribers, according to the complaint.

Judge Richard Leon, who will decide if the merger may go forward, is hearing evidence on whether the $84.5 billion deal is illegal under antitrust law, as the government alleges, and should be stopped.

The witnesses this week are expected to include AT&T Chief Executive Randall Stephenson and Time Warner CEO Jeff Bewkes.

(Reporting by Diane Bartz; Editing by Peter Cooney)