» Appellate Court Orders Sprint to Divest Nextel Holdings in Parts of MidwestTelecommunications Industry News

Telecom News Editorials Reports Glossary

Appellate Court Orders Sprint to Divest Nextel Holdings in Parts of Midwest

6:00 am on April 2, 2008 | Category: Business, Law, Wireless

An appellate court in Illinois has upheld a lower court decision forcing troubled wireless carrier, Sprint Nextel Corp., to stop selling Nextel-branded products in parts of the Midwest.

The case was brought by iPCS Inc., a Sprint-branded affiliate which objected to the company’s 2005 merger with Nextel Communications, claiming that it violated iPCS’s exclusivity agreement with Sprint. Cook County Cirguit Judge, Thomas Quinn, ruled in 2006 that Sprint must divest its Nextel assets in parts of Illinois, Michigan, Iowa, and Nebraska within a period of 180 days.

The order was put on hold pending a legal challenge from Sprint, but has now been reinstated and the appeal dismissed.

“We are pleased that the appellate court affirmed the decision of the trial court,” said iPCS CEO, Timothy Yager, in a statement. “This is a significant victory for iPCS and we look forward to Sprint’s compliance with the circuit court’s 2006 order.”

iPCS serves 629,900 wireless subscribers in the markets covered by this ruling. Its stock surged more than 35% after the ruling was handed down on Monday, and a further 6.3% yesterday.

Telecommunications Industry News