Bouygues Telecom sues Free Mobile over smears and 'unfair competition'

Bouygues Telecom is asking the Commercial Court of Paris to award damages of €98 million after suing rival Iliad's Free Mobile for "defamation and unfair competition."

According to the French magazine Challenges, the lawsuit accuses Free Mobile of conducting a smear campaign against Bouygues Telecom by mocking its management, and questioning the operator's strategy and tariff structure.

The legal action claims that Free Mobile, which started this war-of-words when it launched serviced in January, called Bouygues Telecom's customers (and those of other operators) "pigeons" or "cash cows."

"Such arguments, to the extent that they are repetitive and constant, are considered an injury that Bouygues Telecom wishes to see stopped," a Bouygues Telecom spokesman told Le Monde. "We believe it's unacceptable that an operator uses defamation against its competitors, their customers and employees as a weapon to promote sales."

An unnamed source close to the matter told Challenges that Bouygues Telecom was asking for a legal ruling on whether it is normal for competitors, even when the rivalry is intense, to repeatedly insult others in the same market. "Such insults and defamations constitute a smear and undermine the proper functioning of the market as a whole," the source said.

A Bouygues Telecom worker, on condition of anonymity, told Challenges that the operator had been preparing its case for some while and was going on the offensive.

Separately, Bouygues Telecom and SFR have joined the list of companies that have complained to the French Competition Authorities over France Telecom Orange's "predatory strategy" in the quad-play market.

The complaint focuses on Orange consumers being locked into the company's Open quad-play services. If subscribers cancel their fixed broadband subscription they then lose the advantages of the mobile component of the offer and need to sign another one- or two-year mobile contract, according to TelecomPaper.

For more:
- see this Challenges article (translated via Google Translate)
- see this Le Monde article (translated via Google Translate)
- see this TelecomPaper article (sub. req.)

Related Articles:
Free Mobile ups ante in French mobile price war
Vivendi: Changes in French political environment will curb Free Mobile
Report: SFR, Free Mobile discuss possible merger
SFR results hurt by domestic price war; Vivendi ducks break-up question
Rumour Mill: SFR faces €350M more in cost cuts by 2013

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