The lawsuit, filed in federal district court in New York, centered
on a contract that Iusacell said IBM induced it to enter into in
"Events subsequent to the execution of the agreement have revealed
that IBM both knowingly misrepresented and wrongfully concealed from
Iusacell material facts both before and during the parties'
relationship," Iusacell said in the complaint.
IBM said in a statement that the lawsuit was a "transparent attempt"
by Iusacell, which is co-owned by media and retail mogul Ricardo
Salinas' Grupo Salinas and broadcast giant Grupo Televisa, to avoid
its contractual obligations.
IBM said it signed a long-term contract with Iusacell in 2010 under
which IBM's Mexican unit made significant investments in Iusacell's
"Despite major improvement to Iusacell's information technology
infrastructure and growth in Iusacell's revenues, Iusacell has
failed to pay IBM Mexico what it is owed under the contract," IBM
said in the statement.
IBM's Mexican unit already has filed an arbitration claim against
Iusacell in an effort to enforce the contract, according to IBM,
which called Wednesday's lawsuit an "ill-advised attempt to end-run"
A spokesman for Grupo Salinas had no immediate comment on the case
and a lawyer for Iusacell did not respond to a request for comment.
According to the lawsuit, Iusacell's management designed a plan to
boost the market share and revenue of the company, which was then
the third-largest mobile phone operator in Mexico.
[to top of second column]
Doubtful its existing information technology systems could support
the plan, Iusacell sought advice from IBM, the lawsuit said. Several
pages of the complaint are then redacted, leaving it unclear what
Iusacell, however, said in the lawsuit that IBM's capacity limits
crippled its performance.
It is not known why parts of the complaint were redacted. Companies
sometimes seek to keep material confidential to protect trade
The lawsuit seeks $2.5 billion in damages. Iusacell said its claims
are governed by Mexican law, which entitles it to both actual
damages and lost profits that stemmed from its reliance on the
alleged IBM misrepresentations.
The case is Iusacell SA de CV v. International Business Machines
Corporation, U.S. District Court, Southern District of New York, No.
(Reporting by Nate Raymond in New York; additional reporting by Jon
Stempel in New York and Michael O'Boyle and Dave Graham in Mexico
City; editing by Paul Simao)
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