Ripple effects from the DOJ about the AT&T/Time Warner merger are a bit stunning. Judge Richard Leon specifically warned the U.S. government not to try to block it with an appeal but now they’ve gone ahead and appealed, writes Gene Inger.

Thursday evening was more confusing since regulatory go-aheads were already given to other plays in the same competitive space. The entire swinging series of offers and counters involving Fox (FOXA), Disney (DIS), Sky and Comcast (CMCSA), for all practical purposes didn’t get into full swing until the AT&T (T)deal.  

Reuters: S&P hits 5-month high Friday as industrials, energy boost. Banks weigh.

Judge Leon will be furious that the solicitor general apparently allowed a DOJ appeal. Remember he warned them against doing that.

Maybe they’ll try to compel a spin-off of CNN or HBO, hard to say. If it was to spin-off DirecTV that would be another story. (The business is shifting from satellite to Over-the-Top internet broadcasting, and rapidly so at that.)  

Maybe DOJ gets fully rejected again, especially since everyone else has similarly geared-up for deals. And of course, investment bankers and lawyers will be furious if the whole issue goes back into adjudication and might postpone the others, since there are so many associated overlapping competitive aspects.

At least now we know (somebody did) what was behind Wednesday’s drop in AT&T (presuming aside the market there was leakage). And Thursday that was assumed not to be the case.

Then came the appeal. Recall Judge Leon said if the government sought a stay in the merger, it would be a “manifest injustice.”   

The big picture, writes Dylan Byers for CNN (part of Time Warner) Friday: For now, the freeze on M&A is back. AT&T can continue running WarnerMedia as it sees fit until the case is decided, but it has a new distraction on its hands at the D.C. Circuit Court of Appeals.

AT&T CEO Stephenson still confident Friday that Time Warner deal on solid ground: Reuters.

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