Intelsat Sues OneWeb and Softbank
Intelsat accused OneWeb and Softbank Group of fraud, conspiracy, and breaching contract. The lawsuit was filed in the New York Supreme Court on Sept. 10. “Upon information and belief, SoftBank and OneWeb intentionally and knowingly made or caused to be made materially false statements and/or omissions in their communications with Intelsat and/or its agents with the intent to defraud Intelsat,” read the court document.
The document continued: “SoftBank and OneWeb represented to and/or assured Intelsat that it was negotiating the MSA in good faith with the intent to reach an agreement. 89. Upon information and belief, these representations and assurances were false and/or misleading. Upon further information and belief, while Intelsat engaged in negotiations in good faith over a period of several months, OneWeb had already internally planned in secret to renege on the Amended SCA and begin competing with Intelsat in the Intelsat Exclusivity Markets. Unbeknownst to Intelsat, at the time that SoftBank and OneWeb were negotiating and eliciting confidential and proprietary information from Intelsat relative to the Intelsat Exclusivity Markets (including confidential forecasts, business cases, marketing strategies, pricing and capacity requirements) OneWeb was planning to treat the Amended SCA as terminated and of no continuing effect and compete directly with Intelsat.”
When contacted about the lawsuit, Intelsat declined to comment.
The lawsuit stems from an agreement between Intelsat and OneWeb that was made in 2015 after Intelsat decided to join OneWeb’s group of initial investors. Under that agreement, Intelsat said it would partner with OneWeb to use OneWeb’s Low Earth Orbit (LEO) platform to complement Intelsat’s Geostationary Orbit (GEO) satellite services. Complementing the 2015 commercial agreement, Intelsat announced that it would make a minority share investment of $25 million in OneWeb. The companies would also collaborate to develop hybrid LEO/GEO end-user access terminals.
In February 2017, Intelsat and OneWeb entered into a definitive combination agreement pursuant to which Intelsat and OneWeb would merge in a share-for-share transaction. Intelsat and SoftBank Group also entered into a share purchase agreement in which SoftBank would buy voting and non-voting shares in the combined company for $1.7 billion in cash and take a 39.9 percent voting stake. Intelsat, OneWeb, and SoftBank agreed to dissolve the potential merger in June 2017.