iPCS subsidiaries file suit against Sprint over Virgin deal

Three iPCS subsidiaries filed a lawsuit against Sprint Nextel and are seeking to block the close of Sprint's $483 million acquisition of Virgin Mobile USA.

The complaint was filed Sept. 10 in the Circuit Court of Cook County, Ill., by iPCS Wireless, Horizon Personal Communications and Bright Personal Communications Services. Among other things, the complaint alleges that Sprint, through its acquisition of Virgin, would be competing with the iPCS affiliates in their exclusive territories, in violation of agreements iPCS affiliates have with Sprint.

In a release, iPCS said the subsidiaries are asking the court to postpone the Sprint-Virgin merger until it can be modified in order to account for the subsidiaries' agreements with Sprint.

Sprint spokesman Matt Sullivan described the claims by the affiliates as "meritless." Virgin Mobile spokeswoman Jayne Wallace said the company had no comment.

This is the latest in a series of long-running court battles between iPCS and Sprint. The Cook County court ruled in February that Sprint violated agreements with iPCS by operating its Nextel iDEN networks in territory in which iPCS had affiliate exclusivity rights, and ordered Sprint to stop owning, operating and managing the offending portions of the Nextel network by Jan. 25, 2010. The affiliate has also fought Sprint over its relationship with Clearwire.

For more:
- see this release [1]

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Class action claims Virgin Mobile undervalued in Sprint deal [4]
Virgin Mobile's profit surges, but subscriber losses continue [5]
Sprint buying Virgin Mobile USA for $483M [6]