AP

• Bloomberg News reported Monday afternoon that the US Department of Justice was prepared to sue to block AT&T's proposed buyout of Time Warner, citing "a person familiar with the matter."

• Time Warner stock closed down 1.12% after the news. 

• Shares of AT&T fell from earlier highs but still closed up 0.29%.

The US Department of Justice is prepared to file an antitrust lawsuit, effectively blocking AT&T's proposed $84.5 billion takeover of Time Warner, Bloomberg News reported Monday, citing "a person familiar with the matter." 

Following the reports, shares of Time Warner fell 1.12%, closing at $87.66 Monday.  AT&T shares took a slight hit, but were still in the green, up 0.29% at the end of trading Monday. 

The news of the antitrust lawsuit follows a contentious period that included reports that the DOJ demanded AT&T and Time Warner sell Turner Broadcasting, the group of channels that includes CNN, in order to receive approval for the deal.

AT&T Chief Executive Officer Randall Stephenson countered those reports by saying he'd never been under pressure from the DOJ to sell CNN.

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