Despite last-minute pleas by the principals, U.S. District Judge Harold Greene yesterday denied requests by the American Telephone & Telegraph Co. and the Justice Department for a delay in next week's start of the government's antitrust suit against AT&T.
Greene's action came as both sides acknowledged for the first time that "discussions" about possible settlement of the six-year-old case have intensified during recent weeks.
In fact, in a six-page memorandum released yesterday afternoon, Greene said that he had met Tuesday with Sanford Litvack, head of the Justice Department's Antitrust Division, and Howard Trienens, AT&T's vice president and general counsel, to discuss "a framework for settlement" of the case that had been agreed to by both sides.
Greene said it "appears" that, although both sides had conducted previous settlement talks, "their discussions became substantial only about a week or 10 days ago.
"This relative neglect of the settlement possibility until just now is puzzling since the case itself has otherwise been far from neglected by either party," Greene wrote.
The flurry of activity comes on the eve of what had been thought to be the final pretrial hearing, which is scheduled for today. Greene has ordered that the trial begin Jan. 15.
The case, perhaps the most important government antitrust case in history, is based on Justice Department charges that the Bell System has engaged in multiple violations of federal antitrust law. The government is expected to ask that the Western Electric manufacturing arm of AT&T, the nation's largest company, be split from the parent company.
Reached yesterday evening after the release of the Greene order, Litvack said that "for a variety of reasons, parties are always interested in resolving their case. . . . That interest increases as the case nears."
Asked if the upcoming change of power in the White House was related to the apparent movement in the talks, Litvack said that the "possibility of settlement has nothing to do with the change of administrations. To the extent that they [the discussions] have become more intense, [it] is because when you are nearing a trial, that is a normal phenomena."
Pickard Wagner, an AT&T spokesman, emphasized that the talks should be characterized as discussions and not negotiations. Reacting to the Greene decision, Wagner said AT&T "is prepared to litigate or negotiate.
Wagner said the impetus for the settlement talks had in part stemmed from a July 21 letter from Rep. Peter Rodino (D-N.J.)., chairman of the House Judiciary Committee, to former Rep. Lional Van Deerlin, then a sponsor of telecommunications legislation that approached the structural future of the Bell System in a far different way than the Justice Department's suit.
In that letter, Rodino had urged the parties to seek a solution to the case. "And that's what we're doing," Wagner said.
Greene said that both sides had offered a "guess" that the actual settlement agreement was 60 to 90 days away and that the parties also were guessing about "the likelihood that there will ever be a settlement."