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TELUS Loses Its Battle In Court To Purchase Rival Canadian Carrier Mobilicity

December 8, 2014 - Written By Cory McNutt

TELUS Corporation went up against the Federal Government and not only lost its court battle, but was ordered to pay the $12,000 court cost incurred by the Government.  Most people could see this coming – spokesman for the Industry Minister James Moore said, “Our policy has always been clear – we will not approve spectrum transfer requests that decrease competition in the wireless sector.”  TELUS made repeated efforts to buy failing Mobilicity and the judge wrote, “The most that can be said is that TELUS made a business gamble and lost.  It’s not the Minister’s fault.”  That last sentence sums it up in a nice tight package.

TELUS took the Federal Government to court in July 2013 questioning if the Industry Minister has the legal right to approve or disapprove in changes on whom is in control of a company.  This was all brought about by TELUS trying to purchase Mobilicity and the Industry Minister overturning their bid to acquire Mobilicity.  We are not talking about TELUS trying to acquire a thriving company – Mobilicity is on the verge of bankruptcy and is protected only by the courts at this time.  Allowing the sale to go through would pay off Mobilicity’s creditors and possibly keep many jobs going, however, TELUS would also end up with Mobilicity’s spectrum as well and that is where the Government has a problem. TELUS has challenged the Government on several occasions – it brought multiple legal actions concerning their spectrum policies, but lost that challenge in January of this year.  The Government definitely controls, possibly unfairly at times, the spectrum sales, refusing to allow the Big Three – Rogers, Bell and TELUS – full access in the sales.  The Government bends the rules to show favoritism to the new entrants or smaller telecom companies.  TELUS took them to court, arguing that fact, but lost.

TELUS is not the only one taking the Government to court – In September, equity investors for Mobilicity filed a $1.2 billion lawsuit for damages, insisting that the Government broke promises it made to convince them to invest in the wireless industry in the first place.  They claim that the Government offered them certain assurances in return for their investment.  These promises revolve around wholesale roaming, cell tower sharing and that investors would be allowed to sell their company back to an incumbent provider after a five-year waiting period.  This case was transferred to the Ontario Superior Court of Justice, which hears cases that are more complex. It is a never ending saga in the Canadian land of wireless suppliers versus the Federal Government.  Please hit us up on our Google+ Page and let us know how you feel about the wireless carriers and Government in Canada…as always, we would love to hear from you.