Judge Dismisses Investor Suit Against AT&T Over Lead Cables
The court said some claims were actionable and gave the investors 30 days to file a new complaint.
WASHINGTON, June 26, 2025 – A federal judge dismissed last week a lawsuit from AT&T investors who alleged the company misled them about risks related to lead cables. The court gave the investors 30 days to file an amended complaint.
Chief Judge David C. Godbey of the Northern District of Texas said some statements made by the company were potentially false and therefore actionable, but the investors hadn’t made a strong enough showing that AT&T executives were being deceptive or reckless.
“The complaint fails to allege any facts showing the Individual Defendants were aware of any widespread environmental contamination risk or employee health issues that could reasonably result in material risk to the company,” Godbey wrote in a June 16 opinion.
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The suit was brought by a set of New York City retirement and pension funds in 2023 after a Wall Street Journal report on aging lead-coated cables caused telecom stocks, including AT&T’s, to dip.
The pension funds alleged AT&T executives including CEO John Stankey knew of environmental and health risks posed by the company’s hundreds of thousands of miles of lead cables, and didn’t properly disclose them when touting cost savings from the carrier’s transition from copper to fiber. The judge was not persuaded.
“Reviewing the complaint holistically, the Court cannot say there is a strong inference of intent to defraud or severe recklessness as to Stankey,” Godbey wrote. “Instead, the Court recognizes the at least slightly more persuasive inference that Stankey truthfully believed AT&T’s wireline transformation would reduce costs and had no information that would give notice of severe risks in that effort.”
Godbey said the same of other executives named in the lawsuit.
Some claims by AT&T were potentially false or misleading, judge said
He said some of the claims made by AT&T and its executives were at least potentially false or misleading and could be actionable, but they would also require a showing of intent or severe recklessness to ultimately be successful if the investors refile the complaint.
Those claims included those about cost savings related to the transition away from legacy infrastructure and statements in which the company said it disposed of regulated materials in an “appropriate manner” and incinerated hazardous waste.
“These statements are plausibly alleged to be false, as Plaintiffs claim that AT&T would vacate wirelines (by ceasing to use them) but instead of removing lead (a regulated material), AT&T would simply leave the wires in place while knowing they were likely to leach lead into the environment,” Godbey wrote. “At this stage, these allegations are sufficient to establish falsity for these statements.”
Fellow telecom giants Verizon and Lumen were also sued by investors and others after the Wall Street Journal story, with both companies beating back investor suits earlier this year.
