The Justice Department continued to press yesterday for a breakup of American Telephone & Telegraph Co., charging in court papers that the company's "conduct reflects all the evils of a classic monopoly."
The U.S. position was stated in a response to AT&T's call for dismissal of the government's nearly-eight-year-old antitrust suit. "Nothing short of the structural relief requested by the United States in this case will eliminate AT&T's opportunities and incentives to continue in that course of conduct unabated," the Justice Department said.
The government's call for splitting AT&T's 23 local operating companies from the Bell System's long-distance, equipment and research facilities was made despite the willingness of the assistant attorney general for antitrust, William Baxter, to drop the case in exchange for amended telecommunications legislation that Baxter has said would solve the problems raised in the suit.
"There are uncertainties in life, and I wouldn't attempt to predict what will happen in Congress, but the goal of this litigation continues to be divestiture," Gerald Connell, chief of the government's AT&T trial team, said in an interview. "I have no doubts that I speak for the Antitrust Division and no doubts that I speak for the plaintiff."
But an AT&T spokesman called the government's brief "the same old song and dance.
"Despite what everybody else in government seems to be saying these days, the lawyers in the case continue to seek an approach no one else in government seems interested in trying to do and that is to break up AT&T," said company spokesman Pickard Wagner. "It is as bizarre an Alice in Wonderland situation as it has been since the case was filed. They remain out of touch with reality."
Wagner was referring in part to an administration Cabinet council staff report, which urged dismissal of the case, arguing that it hindered passage of telecommunications legislation and created uncertainty in the industry.
That Cabinet council opposition to the case resulted in a request from Baxter late last month to delay the case for 11 months to give legislation an opportunity to move through Congress. But U.S. District Court Judge Harold Greene rejected that move, and the case continued on Aug. 3.
The trial began in March, and the government closed its presentation on June 30. On July 10, AT&T asked Greene either to dismiss or to narrow the case, and the government filed its petition yesterday in response to that motion. Greene will hear oral arguements on the motion for dismissal Thursday and expects to rule shortly thereafter.
The Justice Department summed up its case in a 410-page memorandum, arguing that AT&T willfully has maintained a monopoly in long-distance services, pricing and telecommunications equipment markets at the expense of competition. The government called 93 witnesses, provided more than 11,000 pages of testimony and introduced almost 3,500 pages of documents.
In the long-distance market, "AT&T's actual control over entry and price, of course, is the most powerful evidence of AT&T's monopoly power," the government said. "Regulation has been, and will continue to be, unable to control AT&T interconnection practices."
The government charged that AT&T's pricing practices have had "the sole intent of deterring or excluding competition without regard" to the antitrust laws.