Sprint Nextel Wins Arbitration Against Nextel Partners

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Sprint Nextel has announced that the panel in the arbitration initiated by Nextel Partners Inc. unanimously denied a request by Nextel Partners to preliminarily enjoin Sprint Nextel’s national rollout of the new Sprint brand. During a full-day hearing on Aug. 25, the arbitration panel, consisting of two former U.S. federal court judges and a professor from a major law school, heard arguments concerning Nextel Partners’ request for a preliminary injunction pending the completion of the arbitration proceedings. The panel later ruled that Nextel Partners had not demonstrated a likelihood of success on the merits of its claim that the rollout breached the requirements of Nextel Partners’ operating agreements.

The arbitration panel rejected claims by Nextel Partners that those agreements required Sprint Nextel either to allow Nextel Partners to use the new Sprint logo or to sell Nextel iDEN products only under the Nextel brand and not under the Sprint brand. Additionally, the panel concluded that the parties’ contracts “do not appear to support” Nextel Partners’ argument and also rejected Nextel Partners’ position that it would be irreparably harmed by the rollout of the new Sprint brand.

Nextel Partners initiated the arbitration shortly after it recommended that its shareholders begin the put process, or share purchase rights, under the company’s charter. This process was triggered by the completion of the Sprint Nextel merger on Aug. 12, 2005.

Sprint Nextel said it is pleased with the panel’s ruling and intends to continue to comply with its agreements with Nextel Partners.

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