(Bloomberg) -- T-Mobile US Inc. says the antitrust expert hired by a group of states seeking to block its takeover of Sprint Inc. “rigged” his analysis of stock prices in a report that will be used as evidence in an upcoming trial.
Carl Shapiro, a professor at the University of California at Berkeley, cherry-picked trading data and ignored historical stock movements that undermined his theory about why the merger should be blocked on antitrust grounds, lawyers for T-Mobile and Sprint said in a filing late Friday in federal court in New York.
“He fails to perform any statistical analysis that controls for the many factors affecting stock prices of highly liquid securities,” the companies said in the filing, asking to have the report thrown out. “Stock price movements alone are not a proxy for evidence of what unidentified investors thought about anything, let alone the competitive effects of a merger.”
Shapiro couldn’t be reached after regular office hours and didn’t immediately respond to an email.
The states, led by New York and California, sued in June to block the deal, arguing it would raise prices for consumers, particularly in urban areas. The U.S. Justice Department’s antitrust regulator has already cleared the deal.
Shapiro’s “fundamental hypothesis” about the proposed merger’s impact on stock prices is redacted in the filing, as are many other elements of his findings. But T-Mobile argues in the filing that the report should be blocked from trial because it’s unreliable and contradicted by share movement in the industry when the merger was announced and when the suit was filed.
Shapiro was the government’s star witness when the U.S. sued, unsuccessfully, to block AT&T Inc.’s takeover of Time Warner Inc. In that case, U.S. District Judge Richard Leon in Washington was particularly critical of Shapiro’s work in finding that the government had failed to make its case.
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