It only seemed like a matter of time before things got worse for LightSquared, and today the nation’s third largest wireless carrier has dealt the ailing company another significant blow. With the upstart network provider unable to land FCC approval thanks to some pesky GPS interference issues, Sprint has announced that they have chosen to officially terminate their agreement with LightSquared.
Sprint noted that they would still be open to future collaborations so long as LightSquared could get their wireless affairs in order. That still seems like a tall order at this point — little movement has been made on that front since the FCC revoked their conditional approval of LightSquared’s network buildout earlier this year.
Still, it looks like LightSquared has some fight left in them yet. As a result of the agreement, Sprint must return the $65 million given to them by LightSquared as part of the 11-year payment plan the two companies agreed upon in mid-2011. Though Sprint certainly could’ve used the cash, LightSquared arguably needs it far more — they recently had to lay off 45% of their workforce to reduce operating costs, and the company is the midst of preparing to mount a legal offensive.
Politico reported earlier this week that LightSquared now has two “prominent conservative litigators” — Theodore Olson and Eugene Scalia — on retainer, which hints at a potential legal battle with the FCC in the near future. Though their specific legal strategy is still shrouded in mystery, LightSquared spokesperson Terry Neal notes that the two “have extensive experience assisting clients with significant challenges involving government agencies,” and that the company is pleased to have them on their side. Those of you itching for a good old-fashioned legal throwdown may want to keep your eyes on LightSquared — things look bad for them now, but they sure do love a fight.