Imagine sues Motorola for €107m over alleged delay in network rollout
BROADBAND operator Imagine is suing telecoms giant Motorola for more than €100m over alleged problems connecting customers to the internet -- as it continues a national advertising campaign for new subscribers.
Telecoms giant Motorola Ltd is being sued by the Imagine Communications Group over alleged breach of agreements related to the planned rollout of an end-to-end broadband network in Ireland using Motorola's wireless WiMax technology.
Imagine is suing Motorola for €107m over alleged delays in the rollout of the network which, it is claimed, gave rise to financial problems for Imagine and losses because of a failure to connect consumers to the internet or because of poor connectivity.
Imagine, which was the first company to bring WiMax wireless technology to Ireland, says its business plans envisaged that 234 base stations would be installed by the end of 2010, but just 125 stations have been installed to date.
Yesterday, the High Court heard that Imagine claims that the delays have "significantly depleted" its working capital and it has been forced to restructure existing debt as well as taking on new debt.
Some 20,000 customers are potentially affected by the litigation, which Motorola is seeking to have struck out of court amid claims the case pleaded by Imagine and two of its subsidiaries are "embarrassing".
Last night, Sean Bolger, CEO of the Imagine Communications Group, refused to comment on the legal action.
However, the company said new customers were not affected by the litigation as the issues between it and Motorola were "historical".
Motorola Networks, which has been taken over by Nokia Siemens Network, denies the claims and insists it has met its contractual obligations.
High Court Judge Mr Justice Peter Kelly reserved judgment on whether the case should be struck out or repleaded following two days of legal argument at the Commercial Court.
The case has been brought by IBB Internet Services Limited, Irish Broadband Internet Services Ltd -- trading as Imagine Networks -- as well as Imagine Communications Group Ltd.
Motorola has objected to plans by Imagine to take the action as a single economic entity or alternatively to plead that two of the subsidiaries involved in making a series of alleged written and oral contracts with Motorola were acting as agents for the parent group.