Meridian Communications Limited was yesterday refused a High Court order restraining Eircell from terminating a Volume Discount Agreement with Meridian, a telecommunications service provider.
However, Eircell gave undertakings to the court that it would not terminate the VDA, which allows Meridian to sell on air time, before its expiry date at the end of this year.
The two companies first negotiated a VDA in September 1997. It was renewed in 1998 and is set to last until November. Eircell earlier this year told Meridian it did not intend to renew the licence when it expired.
Meridian, and its subsidiary company Cellular 3 Telecommunications Ltd, had sought a number of interlocutory orders against Eircell, including orders restraining Eircell from terminating the VDA and directing Eircell to operate that agreement in a fair and proper manner pending the outcome of proceedings between the companies.
Meridian alleged that Eircell was abusing its dominant position in the mobile phone market place and was seeking to put the smaller company out of business. Eircell denied the claims.
In her judgment on the interlocutory application yesterday, Ms Justice Carroll said there was clearly a serious issue to be tried between the parties, and she was also satisfied damages were not an adequate remedy for Meridian at this point.
However, she found the balance of convenience was against granting the interlocutory order restraining Eircell from terminating its VDA with Meridian.
Meridian said it did not have to have a licence to provide mobile communications services and claimed it did not need one, but in the judge's view a licence was required. She would not ask Eircell to breach the terms of its licence to provide air time to unlicensed service providers.
Dealing with Meridian's claims that Eircell had sought to jeopardise its business, the judge said that whatever suspicions there were about the timing of problems between the companies, she was satisfied an undertaking by Eircell to honour the terms of its existing VDA with Meridian would meet the requirements of the situation.
Mr Paul Sreenan SC, for Eircell, gave the undertaking on behalf of Eircell to apply until the termination of the existing VDA between Eircell and Meridian.
Ms Justice Carroll reserved costs pending the outcome of the full hearing of the action between the parties.