Similar to the US Unwired motion to halt the Sprint Nextel merger on the grounds that the Nextel inclusion would provide direct competition in US Unwired markets, today, Nextel Partners has followed suit.
Nextel Partners Inc. is a Nextel affiliate that operates in similar fashion to the Sprint affiliate system, being able to have exclusive rights to sell and service Nextel customers under the Nextel corporate identity, with exclusivity to their respective territories. Nextel Partners Inc. argues that the inclusion of Sprint’s CDMA service in markets where Nextel has exclusive rights to sell Nextel service brings Sprint Nextel into direct competition, and thus violation of their no-competition clauses.
Nextel Partners disclosed this in an 8-K SEC filing posted today to their investor relations web site. Nextel Partners is using their dispute resolution clause in their affiliate agreement, however, right after invoking that, they filed for an immediate injunction in the New York Supreme Court. If either the US Unwired injunction, or the Nextel Partners injunction is approved by a judge, Sprint and Nextel will not be allowed to merge until the injunction is lifted (through appeal) or until the disputes are adjudicated.
