Cable & Wireless Plc. filed a tactical lawsuit against MCI Communications Corp. (MCI) on Wednesday, seeking an injunction that would require MCI to comply with its agreement to sell its Internet backbone business to the British company.
MCI has not reneged on the deal and said it was surprised by the lawsuit, which was filed in US District Court in Washington.
Cable & Wireless said in a statement that it filed the complaint in order to protect its position.
The lawsuit was seen by industry experts as a pre-emptive strike to force MCI to comply with the sale in case MCI makes other concessions to gain regulatory approval for the WorldCom deal.
MCI agreed last month to sell its wholesale Internet business to Cable & Wireless for US$625 million. That sale is contingent on MCI gaining regulatory approval on its proposed acquisition by WorldCom (WCOM).
MCI agreed to sell its Internet assets in a move to appease antitrust concerns that a combined MCI-WorldCom would have a dominant position in the Internet market.
MCI rivals GTE and Sprint have said the proposed sale of the Internet assets to Cable & Wireless did not do enough to appease antitrust concerns.
European competition chief Karel Van Miert also said the companies must do more to win his blessing.
Van Miert said Wednesday that he expected MCI and WorldCom to make additional proposals to gain the approval of regulators.
