Sprint PCS affiliate Horizon PCS Inc. has filed a lawsuit against Sprint alleging wrongful conduct in its relationship and business dealings with Horizon.
Horizon asserts claims under the federal Racketeer Influenced and Corrupt Organization (RICO) laws and similar Ohio state laws, and asserts fraud, negligent misrepresentation, conversion, breach of contract and breach of fiduciary duties, according to an 8-K filed with the Securities and Exchange Commission.
The lawsuit was filed in the U.S. District Court for the Southern District of Ohio, Eastern Division, by Horizon on behalf of its subsidiaries Horizon Personal Communications Inc. and Bright Personal Communications Services L.L.C. against Sprint Corp., Sprint Spectrum L.P., Wirelessco L.P. and Sprintcom Inc.
Late last week, Horizon PCS and two subsidiaries filed for Chapter 11 bankruptcy protection. The company said it currently pays close to 50 percent of its total revenues to Sprint PCS, which is well above the 30 percent the carrier had originally planned to pay when it became an affiliate in 1998.
Horizon’s troubles follow similar problems by fellow Sprint PCS affiliates iPCS Inc., which filed for bankruptcy protection earlier this year, and U.S. Unwired Inc., which filed a lawsuit against Sprint PCS claiming the nationwide operator is attempting to take control of the affiliate’s operations.
Sprint PCS was at $5.30 per share and Sprint Corp. was at $14.49 per share, both down slightly in mid-day trading Friday.
