SES vs Intelsat nears summary judgement

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SES has filed various Motions in front of Intelsat’s bankruptcy court ahead of a planned hearing on the SES application for a summary judgement in its case for a 50/50 split of the FCC’s incentive payments. The FCC payments are in respect of the C-band reallocation over the US.

Some of the key elements in the Motions are redacted and placed under the court’s seal but include a 22-page document (Exhibit 158) submitted to the FCC in October 2017 by Intelsat and Intel. Another, also filed under seal, is an email from Intelsat’s VP/Communications Dianne VanBeber dated November 18th 2019.

However, a 45-page document from SES’s lawyers argues – again – the key elements from the SES point of view which is that the two litigants were “equal parties” and laboured together for more than a year in pursuit of their joint goals [with the FCC] for an equal share of the FCC’s $9.7 billion in incentive payments.

SES alleges (in a much-redacted document) an “about face” by Intelsat which was “flatly contrary” to the parties’ agreement which called for the 50/50 split of FCC payments. Intelsat, in its counter argument has said that they would have “walked away” from the agreement and “ceasing their cooperative efforts to monetise their C-Band rights and ceding operational control of the C-Band transition process.” They would just give up, alleges SES.

“This after-the-fact story is implausible on its face and directly contradicted by the terms of the Agreement, its basic purpose of advancing the parties’ mutual interest in transitioning their C-Band services in a financially beneficial way, and the parties’ consistent and undisputed course of conduct,” says the SES Motion.

“Intelsat clearly wishes that it had negotiated for a right to withdraw from the C-Band Alliance in the event of a public auction so that it could keep its higher individual allocation of accelerated relocation payments. But Intelsat cannot point to any language in the Agreement granting such a right, nor would SES have ever agreed to it,” says the Motion.

The SES application, in essence, is that if a Summary decision is reached then it should be in favour of SES, or else “a trial on the merits [of the case] is warranted.”

Meanwhile, a 57-page counter-Motion from Intelsat, also filed on July 16th, argues their key points which include a claim that Punitive Damages are not available for breaches of fiduciary duty in this case and that “no reasonable fact-finder would award punitive damages here”. Intelsat rebut the SES claims saying the SES arguments are meritless and should be denied. Intelsat says: “SES offers a 75-page infomercial presenting its spin on the events surrounding the FCC’s decision to reject the approach for which the C-Band Alliance (CBA), Intelsat, and SES advocated. In the process, SES ignores the contract and backtracks from its prior, unequivocal statements confirming that if the FCC rejected the CBA’s market-based approach (which it did), the CBA would disband.”

The hearing is currently scheduled for August 19th.


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