Aspen Skiing Company (SkiCo) in Aspen, CO, filed a lawsuit in July against American Tower to break the 2014 contract. The ski company claims that American Tower failed to timely perform obligations under the agreement. Recently, the tower developer filed counterclaims related to the $21 million plan that would improve cellular service at four ski areas, the Aspen Daily News reported. After the 2014 agreement was signed, American Tower reached out to AT&T to provide the wireless coverage, and the project was scheduled to be complete by the end of 2015. However, AT&T’s wireless operations slowed during their acquisition of DirecTV.
American Tower sent a letter to the ski company in March explaining that there were a lot of factors in the wireless industry that were out if its control and led to the delays. “Those include T-Mobile and Sprint abandoning merger plans; AT&T acquiring DirecTV; and the Federal Communications Commission’s declaration on net neutrality,” the news outlet explained. Despite AT&T’s pullback on the plan, American Tower still spend $1.1 million designing a distributed antenna system. The company wanted the tower project to move forward despite AT&T’s lack of participation. However, Gerard Ainsztein, a senior vice president at American Tower, wrote in a letter that “unfortunately that is not how our business works or how the wireless industry works in general,” (Aspen Daily News). Without the capital contributions from a carrier, the tower company can’t get reimbursed for its costs of installing the infrastructure the Aspen Skiing Company required. “While we still believe that there will be interest in a wireless network at Aspen in the future, we are publicly traded and cannot justify a $21 million investment given the current state of the industry,” Ainsztein wrote (Aspen Daily News).
Despite American Tower’s explanation, Matthew Jones, the SkiCo’s chief financial officer, replied in May explaining that American Tower confirmed that it cannot and will not perform under the agreement, and they are now seeking to terminate the agreement. American Tower’s counterclaims against the ski company are for breach of contract. “The lease contains no performance milestones, build deadlines or other affirmative obligations to expend capital for the very reasons described above,” Ainsztein wrote, referring to the industry’s uncertainties (Aspen Daily News). (Photo courtesy of Corbis Images)
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