The government's antitrust case against American Telephone & Telegraph Co. yesterday moved closer to next week's opening of what the two sides predicted could be a two-year trial, even as details emerged about recent settlement discussions of the case.
Those details came from a transcript of a Monday night meeting among U.S. District Judge Harold Greene, the top AT&T lawyer and the chief of the Justice Department's antitrust division. The two parties' request for a delay in next Thursday's opening of the trial was denied Wednesday by Greene.
Greene met Monday night with Assistant Attorney General Sanford Litvack and Howard Trienes, AT&T vice president and general counsel. They told Greene of the general outlines of a settlement "concept and framework," which would end the six-year-old suit.
In the private meeting, Litvack, who said the proposal would be a "global settlement," also told Greene that the pact would be a consent decree "which deals in a variety of ways with the structure of AT&T and its operations, folds in the New Jersey decree and, if you will -- this is a strong word, I don't mean it quite this way -- moots or deals with the FCC decision by structuring it in such a way that both the consent decree and the FCC decision are at least harmonious or complementary."
Presumably Litvack was suggesting that the general outlines of the plan involve both parties requesting from a federal court in New Jersey a lifting or modification of a 1956 consent decree between AT&T and the government that ended a previous case and prevents the Bell System from conducting business in unregulated telecommunications markets.
Further, the settlement "concept" would seem to adopt some of the AT&T structural provisions of a recent Federal Communications Commission decision in which the agency ordered AT&T to set up a separate subsidiary to handle such products.
Although it is unclear from the transcript who initiated the renewed efforts to settle the landmark case -- on the eve of the trial's opening -- Trienens, the company's top lawyer, told Greene that he "got a call" on Dec. 16 and that on Dec. 19 this round of settlement negotiations began. An AT&T spokesman said late yesterday that the call came from the Justice Department.
Trienens then was asked by Greene for the reasons why the negotiations began anew. "All I know is that here we are today closer than we ever dreamed we would be; and yet, when the trial comes along, it will be a different atmosphere," Trienens said.
Litvack agreed, saying that chances for a final settlement would be "substantially reduced" as the trial opened as a result of government staffing problems and that a delay in the trial's opening could bring the two sides close to final terms.
"But one thing that is clear to me is that we cannot, I think, try the case and negotiate a settlement at the same time," Litvack told Greene. Litvack said development of the settlement would take 60 to 90 days.
"It will be done," he told Greene, asserting that the current state of the talks involved a "fairly detailed format" or a "framework, not written in decree-type language."
There is no indication in the transcript about what type of AT&T structural change Litvack would accept.
It is also unclear exactly what motivated the settlement discussions, although Litvack said Wednesday that the talks began, in part, as an inevitable result of the nearing of the trial.
In addition, it is clear that AT&T officials are concerned about the possible damage implications of the trial's opening because facts accepted by a court in an antitrust case may not need to be proved in private suits.
Other antitrust sources also said that AT&T would be more eager to divest itself of subsidiaries of its own choosing, rather than wait for Greene to provide the relief in the case, assuming the government convinces the judge of the merits of the case.
Nonetheless, it appeared that any settlement would be increasingly difficult as the Carter term draws to a close.