Sprint Affiliate Sues Over Virgin Deal

DAVID TWIDDY

KANSAS CITY, Mo. (AP) — Sprint Nextel Corp. affiliate iPCS Inc. is asking an Illinois court to block the wireless provider's planned acquisition of Virgin Mobile USA Inc.

Three subsidiaries of Schaumburg, Ill.-based iPCS filed the lawsuit last week in the Circuit Court of Cook County, seeking an injunction to stop the $483 million deal. They claim it would violate an agreement by Sprint not to compete against iPCS within its territories.

iPCS sells Sprint-branded products and services within a swath of the Midwest.

"This is now the third time in four years that Sprint has attempted to unlawfully compete against and cannibalize its own affiliates," the lawsuit states.

Matt Sullivan, a spokesman for Overland Park, Kan.-based Sprint, said the company was fighting the lawsuit. "We think the claims are without merit," he said.

Sprint and iPCS have battled in the courts before over Sprint's 2005 acquisition of Nextel Communications Inc. and last year's deal with Clearwire Corp. to provide high-speed wireless Internet services — also under the claim that they violated the exclusivity agreement.