A federal judge has dismissed a lawsuit from AT&T investors against the telco over allegations that the carrier misled them about risks related to lead cables.

In an opinion and order, written on June 16, Chief Judge David Godbey said the case against the carrier wasn't strong enough.

The case stems back to a report by the Wall Street Journal back in 2023. The WSJ investigation found that AT&T, Verizon, and other US telecom companies had contaminated US water and soil with toxic lead cabling.

It led to a severe backlash against the telcos, with AT&T strongly disputing the findings of the investigation. The carrier instead argued that its lead-clad cables only "make up a small part" of its network.

As noted in the opinion filed, AT&T stocks fell by 2.18 percent the day after the report was published.

It led to a class action being filed on behalf of all persons and entities, other than defendants, that had purchased or otherwise acquired AT&T Inc. securities between July 28, 2018, and July 26, 2023.

However, a lack of evidence from the plaintiffs led Judge Godbey to dismiss the case.

"The alleged facts generally establish that the Individual defendants knew that (1) AT&T was retiring copper wirelines in place, (2) some of these wires contained lead, and (3) lead is generally harmful," said Judge Godbey.

"But 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."

The plaintiffs had disputed claims made by AT&T that retiring its copper transmission lines would reduce costs, calling these statements "false or materially misleading."

As such, the plaintiffs said the company "failed to apprise investors of the fact that AT&T’s shutdown strategy, involving leaving lead-lined wires in place, was likely to expose AT&T to significant and costly scrutiny, liability, and reputational harm."

AT&T's CEO John Stankey was among those named as defendants in the case. Judge Godbey noted that the court concluded there was insufficient evidence to suggest that Stankey "knew of or was severely reckless in failing to disclose material risks to AT&T stemming from these lead-lined cables."

DCD has contacted AT&T for comment.

The WSJ investigation collected samples from various parts of the country where the lead could be found, including on the banks of the Mississippi River in Louisiana, the Detroit River in Michigan, the Willamette River in Oregon, and the Passaic River in New Jersey.

In total, the test samples from nearly 130 underwater-cable sites, conducted by several independent laboratories, were found to be toxic.

US telecom cabling used lead from the 1880s, initially as a way to sheath and protect copper wires from exposure to the elements, because lead is very stable and does not rust.

Lead was then considered a state-of-the-art material, strong enough to guard the interior copper wires and provide the critical communications infrastructure the public relied on. These lead-sheathed telecom cables would gradually be phased out from the 1950s, but the installed cables have largely remained in place.

At the time of the report, it was noted by Judge Godbey that AT&T still owned approximately 200,000 miles of lead cables around the country, about one-third of which is located on aerial utility poles or underwater.

Court documents in November revealed that AT&T had removed more than 100,000 pounds of lead from Lake Tahoe. AT&T had agreed to remove the cabling in September as part of a settlement it reached in court with the California Sportfishing Protection Alliance (CSPA), which has been pushing the case since 2021.

The company has a dedicated page on its website with facts and information about lead cabling.

AT&T says it inspects its lead-clad cable locations and conducts maintenance as needed, carries out environmental testing near lead-clad cables and shares the results with the EPA, and also offers blood lead level testing to employees who work on or have contact with lead-clad cables, at no cost.