Alo & Clearwire fined for franchise breaches

1 Oct 2007

The Court of First Instance in Madrid has ruled against the Alo Group and Clearwire Espana, ordering them to compensate Sisener Comunicaciones, an Alo franchisee in Zaragoza until the start of 2006, with EUR125,584 (USD179,200) plus interest, for a serious breach of their franchise agreement. The ruling is the first of 26 claims brought by the franchisees of the Asociación Canal AFA, whose claims total approximately EUR7 million.

Asociación Canal AFA filed the claims last year, claiming that Clearwire’s decision to begin a WiMAX project in Spain while excluding the franchises represented a breach of its responsibilities. Furthermore, the judgment upheld the franchisees’ argument that they held the exclusive right to operate the 3.5GHz network.