Illinois Supreme Court Denies Sprint's Petition to Appeal

Business Wire, Sept 24, 2008

Ruling Requires Sprint Nextel to Cease Owning, Operating, and Managing the Nextel Network in iPCS Wireless's Territory

SCHAUMBURG, Ill. -- iPCS, Inc. (NASDAQ: IPCS) today announced that the Supreme Court of Illinois has refused to hear Sprint Nextel's (NYSE: S) appeal of a ruling by the Appellate Court of Illinois issued in March of 2008. The Appellate Court ruling unanimously upheld the 2006 ruling of the Circuit Court of Cook County, Illinois that required Sprint to cease owning, operating, and managing the Nextel wireless network in iPCS Wireless's territory.

"We are very pleased with the Supreme Court's ruling. We have believed from the beginning that Sprint's merger with Nextel and its operation of the Nextel wireless network in our territory is in violation of our subsidiaries' management agreements with Sprint," commented Timothy Yager, president and chief executive officer of iPCS. "We continue to be in similar litigation with Sprint related to its proposed joint venture with Clearwire Corporation (NASDAQ: CLWR) and we intend to take all necessary steps to defend our exclusivity rights under the management agreements. We believe that after all of the evidence is considered in the Clearwire litigation, Sprint will once again be required to comply with the terms of the deal that Sprint agreed to when it entered into the management agreements," added Mr. Yager.

The Company has been advised by Sprint's attorneys that Sprint has filed a petition with the Circuit Court of Cook County of Illinois for relief from that Court's original 2006 judgment. If that is the case, iPCS Wireless intends to vigorously oppose Sprint's petition. "We believe this is yet another attempt by Sprint to avoid complying with the terms of the management agreements that afford iPCS exclusivity in its territories," concluded Yager.

Sprint/Nextel Litigation Background

On July 15, 2005, the Company's wholly owned subsidiary, iPCS Wireless, Inc., filed a complaint against Sprint and Sprint PCS in the Circuit Court of Cook County, Illinois. The complaint alleged, among other things, that Sprint's conduct following the consummation of the merger between Sprint and Nextel, would breach Sprint's exclusivity obligations to iPCS Wireless under its affiliation agreements with Sprint PCS. On August 14, 2006, the Circuit Court issued its decision and on September 20, 2006, the Circuit Court issued a final order effecting its decision. The final order provides that:

* Within 180 days of the date of the final order, Sprint and those acting in concert with it must cease owning, operating, and managing the Nextel wireless network in iPCS Wireless's territory.

* Sprint shall continue to comply with all terms and conditions of the Forbearance Agreement between the Company and Sprint setting forth certain limitations on Sprint's operations following the merger with Nextel.

On September 28, 2006, Sprint appealed the Circuit Court's ruling to the Appellate Court of Illinois, First Judicial District, and, at Sprint's request, the effectiveness of the Circuit Court's ruling was stayed by the Appellate Court pending the appeal. On March 31, 2008, the Appellate Court unanimously affirmed the 2006 Circuit Court decision. On May 5, 2008, Sprint filed a petition for leave to appeal with the Supreme Court of Illinois. Sprint's petition for leave to appeal was denied on September 24, 2008. On September 23, 2008, Sprint's attorneys informed the Company that Sprint had also filed a petition with the Circuit Court for relief from the Circuit Court's original judgment.

Sprint - Clearwire Litigation Background

On May 7, 2008, Sprint Nextel announced it had agreed to enter into a transaction among itself, Clearwire Corporation and certain other parties (the "Sprint-Clearwire Transaction"). The same day, Sprint Nextel filed a complaint for declaratory judgment against the Company and certain of its subsidiaries in the Court of Chancery of the State of Delaware. In that lawsuit, Sprint Nextel seeks a declaration that the Sprint-Clearwire Transaction would not constitute a breach of the three separate Sprint affiliation agreements it has with the Company's subsidiaries.

On May 12, 2008, certain subsidiaries of the Company filed a lawsuit against Sprint Nextel Corporation and certain of its affiliates in the Circuit Court of Cook County, Illinois, seeking declaratory and injunctive relief with respect to the Sprint-Clearwire Transaction. In that case, the Company's subsidiaries seek a declaration that the Sprint-Clearwire Transaction, if consummated, would constitute a breach of the Sprint affiliation agreements between Sprint Nextel and certain of the Company's subsidiaries, and also seek an injunction barring Sprint Nextel from consummating the Sprint-Clearwire Transaction, until the transaction is modified to comply with the affiliation agreements. The case was stayed pending certain events in the Delaware litigation initiated by Sprint Nextel. Sprint Nextel moved to dismiss the Illinois case or, in the alternative, to continue the stay. The Company's subsidiaries moved to lift the stay in the case. On September 15, 2008, the Circuit Court denied Sprint Nextel's motion to dismiss the Illinois case.