Tilson Technology Management has initiated legal action against Gigapower, seeking to recover more than $200 million allegedly owed under a contract for building fiber networks in the United States. The lawsuit highlights significant claims regarding breach of contract and financial mismanagement by Gigapower, a joint venture formed by AT&T and private equity firm BlackRock Alternatives three years ago.
In 2022, Tilson entered into a $600 million agreement with Gigapower to expand fiber networks primarily in the states of Nevada and Arizona. The complaint filed in court accuses Gigapower of violating the terms of their contract, which has led to substantial financial losses for Tilson. As stated in the lawsuit, Tilson is seeking damages for termination charges, underpayments, and missed payments.
According to Tilson, the firm invested hundreds of millions of dollars to fulfill its contractual obligations. The lawsuit alleges that Gigapower intentionally delayed and withheld payments, aiming to coerce Tilson into accepting altered terms. This financial pressure reportedly culminated in Tilson filing for Chapter 11 bankruptcy in May 2023. The complaint claims that when Tilson resisted accepting reduced payments and a modified scope of work, Gigapower terminated the contract “for convenience.”
Company Statements and Reactions
Tilson’s CEO, Darrell Ingram, expressed frustration over the situation, stating, “We entered this contract in good faith and followed through on our obligations at every step of the way, and we expect our clients to do the same.” He emphasized that the lawsuit not only aims to secure payment for Tilson but also serves to protect the interests of its creditors and vendors involved in the project. “We will not rest until Gigapower fulfills its obligations,” Ingram added.
In contrast, a representative for Gigapower responded to the lawsuit by asserting that the company did not breach the contract with Tilson. “It is unfortunate that we have arrived at this point, and [we] will vigorously defend ourselves in court,” the representative stated, indicating that the legal battle is far from over.
This case raises critical concerns about contractual agreements in the rapidly evolving telecommunications sector, especially as companies strive to expand their services amid increasing competition. The outcome of this lawsuit could have significant implications for Gigapower’s operations and its future partnerships.
As the legal proceedings unfold, both Tilson and Gigapower are preparing for what could be a lengthy courtroom battle, each standing firm on their respective positions regarding the contract and associated financial responsibilities.
