The T-Mobile, WCO fight gets muddy

WCO Spectrum finally issued its response to T-Mobile's recent lawsuit against the company, alleging that T-Mobile is engaging in a campaign of "threats, intimidation, and – most effectively – litigation" against schools and other educational institutions. The company also published some of the documents related to T-Mobile's hardball negotiating tactics with those schools.

However, there have also been some interesting developments outside the California courtroom hearing the legal battle between T-Mobile and WCO.

First, T-Mobile appears to have successfully reached an agreement with the Christian College of Georgia to purchase the college's 2.5GHz spectrum license. That's noteworthy considering the college last year sat at the center of a multi-million dollar bidding war between T-Mobile and WCO.

Second, WCO does not appear to have gone through with its own plan to purchase a 2.5GHz spectrum license from the Owasso public school district, as it had intended to. That's noteworthy considering WCO has in the past argued that its pursuit of 2.5GHz spectrum is genuine and that it has the financial firepower to complete such purchases.

The new developments appear to reflect interest by both parties in gaining an advantage over the other, as well as the increasingly complex nature of their fight.

WCO's latest allegations

WCO is headed by Gary Winnick, a financier who founded telecom giant Global Crossing. According to the Los Angeles Business Journal, Winnick is worth $2.2 billion. (And, according to the Wall Street Journal, he's also in the process of selling his Los Angeles mansion for $250 million.)

As Light Reading has previously reported, Winnick's WCO has been looking to purchase 2.5GHz spectrum licenses since the FCC changed its rules for the spectrum band in 2020. Prior to the FCC's rule change, only educational institutions – such as schools, universities and churches – could own 2.5GHz licenses.

However, purchasing such spectrum would essentially make WCO the spectrum landlord of T-Mobile. T-Mobile's midband 5G network is built atop roughly 2,000 spectrum leases with educational institutions nationwide. In some cases, those leases are decades old. The FCC's rule change for the band in 2020 was intended to eliminate that leasing complexity. As Light Reading previously reported, T-Mobile has acquired more than 200 of those licenses since the FCC changed its rules.

But, in its latest courtroom filing, WCO argued that T-Mobile is using its corporate weight to block anyone else from purchasing those spectrum licenses.

"T-Mobile cannot tolerate WCO making competing bids for [2.5GHz] EBS licenses and has fought desperately to stop it," WCO told the court. The company said T-Mobile had filed lawsuits against seven different colleges and educational institutions – using the lawsuits as a "weapon" – to block them from selling their spectrum licenses.

"T-Mobile's tactics thus far advance its true goal: to stop defendants [like WCO] from buying [2.5GHz] EBS spectrum," WCO wrote.

The company also published some of the documents T-Mobile sent to schools like the one in St. Lucie, Florida, in its efforts to prevent them from selling their licenses.

T-Mobile is apparently buying what WCO isn't

T-Mobile isn't sitting still. First, its lawsuit against WCO – filed last month – alleges WCO has engaged in a criminal scheme to defraud. T-Mobile said the scheme has so far cost it $10 million. Notably, T-Mobile argues that WCO has been making "sham offers" and that WCO "lacks the capacity to make good on anything remotely approaching all of these offers."

T-Mobile also offers some choice words for WCO-backer Winnick. The company said Winnick helped torpedo Global Crossing, and as a result "has been hailed into court for a variety of other alleged business transgressions, including claims for contractual fraud against business partners, misrepresenting terms of investment deals, and breaching oral contracts for his personal financial gain."

That's what makes T-Mobile's apparent agreement with the Christian College of Georgia so noteworthy. According to filings this week with the FCC, the college "recently agreed to assign" its spectrum license to T-Mobile. Officials from T-Mobile and the Christian College of Georgia either declined to comment to Light Reading about the agreement or did not respond to requests to do so.

The Christian College of Georgia sits at ground zero in the battle between WCO and T-Mobile. WCO offered to buy the college's spectrum in 2021, but T-Mobile sought to block the transaction, citing the terms of its lease. The college balked and asked the FCC to issue a ruling allowing it to "monetize its investment in the license" by selling it to WCO.

Further, it appears WCO didn't purchase the one 2.5GHz license that it appeared to have won from T-Mobile. As Light Reading previously reported, the FCC last year was reviewing the transfer of a 2.5GHz spectrum license to WCO from the Owasso public school district, one of the largest school districts in the state of Oklahoma. T-Mobile leases that midband spectrum license for use in its 5G network.

The Owasso spectrum was to be the first license purchased by WCO that T-Mobile used.

But an official from the Owasso school district this week confirmed to Light Reading that the transaction never closed, and Owasso still owns the license. He said WCO rescinded its offer in January and the school hasn't heard from the company since.

A WCO official didn't immediately respond to questions from Light Reading on the Owasso transaction.

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— Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano