The WiMax legal battle is heating up.
iPCS, a suburban Illinois company that sells Sprint service in seven states, asked a judge in Cook County to grant an emergency motion for an injunction blocking the Sprint Clearwire spinoff.
The FCC approved the request from Sprint and Clearwire, stating, "The Federal Communications Commission (FCC) today approved,with conditions, the transfer of control of licenses held Sprint-Nextel Corporation and Clearwire Corporation to New Clearwire Corporation. The merger is expected to facilitate the build-out of
a nationwide WiMAX-based network that will lead to increased competition, greater consumer choice and new, innovative wireless services."
iPCS wasn't so agreeable.
The iPCS action is the latest in a series of legal actions between Sprint and iPCS that string back more than half a decade.
iPCS is suing Sprint in Illinois' Cook County Circuit Court to block its plan to spin off its WiMax business to a new company, contending the deal violates the contract it has with Sprint.
iPCS argues that WiMax will illegally compete with the service it sells.
The company argues that it spent "hundreds of millions of dollars" building out Sprint's network in smaller cities. The deal was part of Sprint's plan in the '90s to launch a nationwide network quickly at the least cost.
As part of the deal, affiliates -- and iPCS is one of the few remaining that hasn't been purchased by Sprint -- received a contract under which Sprint agreed not to compete in areas the affiliates served.
Initially, iPCS and other affiliates argued that Sprint's purchase of Nextel violated that contract. The company's argument won, and Sprint has been ordered to divest its Nextel assets in iPCS areas. That action still is pending.
In the most recent court documents, iPCS said the company would "suffer irreparable harm if an injunction is not granted."
The injunction would block the planned spinoff of Clearwire and Sprint's WiMax business into a new company until a court hears the iPCS lawsuit.
A trial is scheduled to begin in Illinois in early December over the Sprint and iPCS WiMax dispute.
"Sprint will compete against iPCS through New Clearwire, and will have the incentive to help New Clearwire (because it shares in New Clearwire's profits) even if that hurts iPCS," iPCS argued in the motion.

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