Bankrupt LightSquared sues GPS companies

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Bankrupt LightSquared sued leaders in the GPS industry on Friday, including Deere & Co. and Garmin International.

LightSquared says the companies kept quiet about interference concerns stemming from its wireless network until the company had already pumped $4 billion into building it, according to a Reuters report.

In a 65-page lawsuit in U.S. Bankruptcy Court in New York, where LightSquared is fighting to keep control of its spectrum, the company alleged that farm equipment maker Deere, and GPS companies Garmin and Trimble Navigation Ltd., led it to believe its network would not interfere with global positioning system devices.

The complaint comes on the heels of a similar lawsuit against the GPS industry by Phil Falcone’s Harbinger Capital, LightSquared’s controlling shareholder.

Last month, LightSquared received permission from the bankruptcy judge overseeing its Chapter 11 case to pause the Harbinger lawsuit so LightSquared could decide whether it wanted to join the suit or bring claims of its own.

Investors are seeking compensation for losses incurred when the Federal Communications Commission denied LightSquared permission to build its wholesale wireless broadband communications network, according to Inside GNSS (Global Navigation Satellite System).

Investors allege that the three firms — Deere & Co., Garmin and Trimble, plus the U.S. GPS Industry Council and the Coalition to Save Our GPS — are liable for failing to warn them about the problems that have now forced a halt to the project.

The filing argues that GPS manufacturers knew of plans to use the frequencies in question for a ground-based network, but did not tell the investors the network would overload receivers, irreparably hampering GPS service.

The plaintiffs also argue that GPS manufacturers were effectively designing their devices to improperly use spectrum owned by LightSquared, creating a problem for which there was no practical solution once thousands of legacy GPS receivers were in place. Had they been informed of these problems, the plaintiffs argue, they “never would have incurred these costs or made their subsequent investments in the new network.”

The GPS community has long argued that the frequencies in question were licensed strictly for satellite-to-ground communication and that any terrestrial operations were intended only to supplement such a service.

Because signals from a satellite are relatively weak by the time they reach the ground they do not create interference or overload issues. Problems only arose when the FCC agreed to allow, albeit conditionally, terrestrial-only LightSquared operations within the previously satellite-only frequency band.

Comments

One comment on “Bankrupt LightSquared sues GPS companies

  1. Jim

    LightSquared essentially bought a piece of property in a residential neighborhood then wanted to open up a shopping center. It was a no-go from the start, but they got the spectrum cheap and wanted to monetize it and make a huge profit. Now they are turning to the lawyers to try and save face and it simply isn’t going to work.

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