AT&T filed the lawsuit in federal court in Atlanta early in November, saying the Verizon ads are misleading and amount to deceptive trade practices. On Wednesday, AT&T and Verizon filed a joint notice to withdraw the case. They did not comment on their reasons.
Two weeks ago, a judge tossed out AT&T's request for a temporary restraining order and a permanent injunction to stop the ads, but scheduled a hearing to give the AT&T attorneys another chance to make their case.
The ads show maps of the United States with areas highlighted to depict where third-generation, or 3G, data network coverage is available. Verizon's coverage, in red, is clearly wider than AT&T's, in blue.
AT&T said those maps could mislead viewers because there it still has regular voice coverage and slower data service in many areas where it doesn't offer 3G.
Verizon's slogan "There's a Map for That" plays off Apple Inc.'s "There's an App for That" ads for the iPhone, which tout the thousands of applications available for the phone. AT&T is the sole U.S. carrier for the iPhone.
In response to Verizon's ads, AT&T has launched an ad campaign with actor Luke Wilson saying AT&T has the "the nation's fastest 3G network."
Also Wednesday, AT&T and Verizon filed notice to abandon a court case in New York that started in July with a suit by Verizon. In that case, each company claimed its competitor's earlier ads were wrong to make claims like "most reliable 3G network" and "more bars in more places."
Verizon Wireless is a joint venture of New York-based Verizon Communications Inc. and Vodafone Group PLC of Britain.