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Inukshuk Wireless Partnership v. NextWave Holdco LLC et al, 2013 ONSC 5631 117 O.R. (3d) 206

Fasken
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NextWave Holdco LLC (“NextWave”), through an indirect subsidiary, 4253311 Canada Inc. (“425”), held licences to use Canadian 2.3 gigahertz wireless spectrum in various geographic territories across Canada. The 2.3 GHz spectrum recently became important in Canada because of its suitability for “long-term evolution” (LTE) technology, which will be the next major advance in high-speed data for mobile phones, and the announcement by AT&T that it would build out on the 2.3 GHz spectrum in the United States. Inukshuk Wireless Partnership (“Inukshuk”) also held licences for the 2.3 GHz spectrum in Canada and in November 2012 entered into a letter agreement under which 425 agreed on certain terms to transfer its licences to IWP for approximately $85.9 million. NextWave guaranteed the obligations of 425. Not long after the letter agreement was made, a rival Canadian carrier offered NextWave $125 million for the licences. In March 2013, NextWave commenced an action for a jury trial in San Diego, where NextWave’s head office was situated, seeking a declaration there was no binding agreement with Inukshuk. Contemporaneously, Inukshuk commenced an action in Ontario to enforce the letter agreement. NextWave brought a motion in the Ontario Superior Court seeking to dismiss Inukshuk’s Ontario action on the basis that Ontario courts lacked jurisdiction because NextWave had no presence in Ontario and the letter agreement was not made in Ontario. NextWave argued, in the alternative, that San Diego was the more appropriate forum. The Court held that it had jurisdiction to deal with Inukshuk’s action and that it should not be stayed. The Court held that Inukshuk had a good arguable case that the letter agreement was made in both Montreal and Toronto, as this is where the contract was accepted. Moreover, Inukshuk had a good arguable case that the wireless spectrum licenses were personal property in Ontario. The court further held that NextWave and 425 failed to establish that California was the clearly more appropriate forum. Fasken Martineau acted as legal counsel to Inukshuk with a team led by Samuel R. Rickett, Murray Braithwaite, Laurence Dunbar, Stephen Whitehead, Jon Lancaster and Kimberly Potter (Litigation & Dispute Resolution).

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